Dominion to pay about 25,000 under oil, gas well settlement

By Steve Korris | Feb 6, 2009

CHARLESTON – Dominion Transmission will send checks to about 25,000 owners and lessors of oil and gas wells under settlement of a class action suit in U.S. District Court.

District Judge Joseph Goodwin approved the settlement on Jan. 30, though he did not know how much it would cost.

"Courts frequently approve settlements such as this where the settlement fund and individual settlement payments are not precisely quantified," he wrote.

Dominion has made an initial deposit of $15 million, he wrote.

Plaintiffs Gary Jones and Shirley Jones alleged that Dominion Transmission and two affiliates improperly deducted certain costs before computing royalty checks.

They sued in Roane Circuit Court in 2006 after the West Virginia Supreme Court of Appeals decided a case in favor of well owners and lessors.

They proposed a class action and sought punitive damages.

Dominion removed the case to federal court in Charleston.

Mediator David Hendrickson brought the two sides together in 2007, and last year he guided them to an agreement.

Goodwin conditionally certified two classes, one for owners and lessors who received royalties at a flat rate and one for those who received one eighth of production.

For each class, the agreement set a formula for calculating payments.

The court sent out about 25,000 notices to individuals and businesses around the nation, and 32 excluded themselves from the settlement.

Plaintiffs believed they had strong claims, Goodwin wrote, and Dominion denied liability.

"The issues in this action involving gas lease language and the permissibility of deductions from royalties are complex and may be difficult for a jury to understand at trial," he wrote.

Marvin Masters, Michael Carey and Scott Segal of Charleston represented the class. So did Thomas Pettit of Barboursville and David Romano of Clarksburg.

Goodwin approved a 25 percent class counsel fee.

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