Appalachian Basin

*UPDATE* Jury’s Decision in Dimock Doesn’t Change the Facts

UPDATE (4/27/2016; 10:15 am ET): E&E News reported today that Cabot Oil & Gas has officially asked a judge in the U.S. District Court for the Middle District of Pennsylvania to award Cabot a new trial, or set aside the jury’s verdict and issue his own final verdict. According to E&E, “if the court refuses, Cabot says it should at least reduce the verdict to no more than $85,500 because ‘sparse evidence simply cannot sustain a $4.24 million award.’” Cabot said the verdict is based on questionable evidence and that the plaintiffs’ attorney, Leslie Lewis, “intentionally misled the jury and created an unfair trial by making baseless accusations in the courtroom.” From the E&E article:

“Cabot Oil & Gas Corp., the company on the hook for methane contamination in water wells in the northeast Pennsylvania township of Dimock, urged a federal judge this week to toss the $4.2 million verdict issued by a jury in March. According to Cabot, the plaintiffs’ lawyer never proved Cabot was responsible for the tainted water, and instead “poisoned the jury against Cabot” by using misleading evidence.

‘The verdict in this case is, simply put, an aberrant result,” Cabot told the court in a brief this week. ‘It defies logic, science, temporality, and the evidence. It can be explained only as the product of an overzealous advocate who refused to stay within the lines so carefully drawn by the Court and the applicable rules of procedure and evidence.’

‘Plaintiffs not only failed to carry their burden of demonstrating causation, but the evidence conclusively demonstrated just the opposite,’ Cabot lawyers told the court this week. ‘Plaintiffs conceded that their water changed before any drilling by Cabot.’”

— Original Post March 10, 2016 —

The trial in Dimock has concluded—for the time being—with the jury awarding $4.24 million to the plaintiffs for nuisance claims. Cabot Oil & Gas offered the following statement to E&E News earlier today:

“Cabot spokesman George Stark said the verdict was surprising and not based on science, and said Cabot would try to get the decision thrown out.

‘Cabot is surprised at the jury’s verdict given the lack of evidence provided by plaintiffs in support of their nuisance claim,’ he said in a statement. ‘The verdict disregards overwhelming scientific and factual evidence that Cabot acted as a prudent operator in conducting its operations. Cabot will be filing motions with the Court to set the verdict aside based upon lack of evidence as well as conduct of plaintiff’s counsel calculated to deprive Cabot of a fair trial.’”

Now, with Cabot filing a motion to have the verdict set aside “based upon lack of evidence” and the “conduct of plaintiff’s counsel,” there may still be another chapter in this case. Meanwhile this doesn’t change the facts presented both in testimony during the trial and in the water tests conducted by the U.S. Environmental Protection Agency (EPA). Let’s take a moment to review some key elements surrounding these claims:

Fact #1: The claims and jury decision had nothing to do with fracking

All the parties – including the plaintiffs’ attorney – have acknowledged on multiple occasions since the trial began almost three weeks ago that the contamination had absolutely nothing to do with fracking. In fact, Leslie Lewis, the plaintiffs’ attorney acknowledged in her opening statements that,

“This is not a case — this is not a case about toxic materials ending up in the water,” she told the jury. “We do not have proof of that. We don’t have proof of that. This is not about fracking fluid appearing in the water. Hydraulic fracturing materials, we don’t have proof of that.”

She later also acknowledged during an objection that “we conceded that there is no toxic content of the water that has been tested out.”

The issue at hand was only about methane migration.

Fact #2: All parties agreed the plaintiffs complained about water issues months before any drilling occurred

Both the plaintiffs and council agree that complaints about the plaintiffs’ water wells first began in the summer of 2008 and that Cabot didn’t drill the natural gas wells in question until the fall of 2008. This means that there were issues with the water at least a few months before any drilling even began nearby, which is common for the area as EID has reported previously.

In reality given that history of the area, and as one of the expert’s for the defense testified, the methane in the plaintiffs’ water wells was likely “naturally occurring.” That expert, Tarek Saba, went as far as to conclude this to be the case, stating:

“My opinions are that the plaintiff’s water wells contain naturally occurring compounds, natural compounds consistent with background, ground water condition. I didn’t see anything outside the range of what I would call bad ground water condition. These wells are not impacted by gas well operations.”

Fact #3: The judge threw out all but the nuisance claim prior to the jury’s deliberation.

The plaintiffs failed to produce evidence that would allow claims of health issues—they never went to the hospital for the ailments they initially claimed the company caused. They failed to produce evidence that fracking had contaminated their wells, as noted above. Despite the judge allowing a claim of a decrease in property values to be made throughout much of the trial, eventually that had to be thrown out when the evidence presented actually showed the plaintiff’s property value had increased since the alleged contamination. EID had the full scoop on that decision earlier this week, but here’s a quick recap of the judge’s ruling:

“And carefully studying that testimony I found no evidence that would allow a jury to reach any sort of judgement on the preinjury value of this property.”

“And therefore, I find as to the first element of permanent real property damage claim, that is proof of the value of the property prior to injury that there’s been a failure of proof by the plaintiffs.”

“And with respect to this property, the only evidence that I have received from the plaintiffs is evidence that indicates a dramatic increase in the value of the property.”

In reality, it was Pennsylvania’s law that gives a “presumption of liability,” or requires that a company be held accountable for any contamination within a certain number of feet from a well regardless of whether the company had anything to do with it, that led to Cabot being held responsible for any methane contamination in Dimock in the first place, as EID previously reported.

Fact #4: The initial contamination claims against Cabot were a result of Pennsylvania’s “presumption of liability” law

Pennsylvania’s law includes a “presumption of liability.” As EID has previously reported, it requires that a company be held accountable for any contamination within a certain number of feet from a well regardless of whether the company had anything to do with it. Reuters also reported on this when the trial began:

“According to court documents, the trial will bring to light a state law that assumes that a gas driller is responsible for water well contamination within 1,000 feet of a drilling site that develops within six months of drilling.”

Fact #5: The U.S. EPA declared Dimock’s water, which included the plaintiffs’ wells, safe in 2012

Any issues of methane migration being brought up today by the plaintiffs occurred years after the EPA had already declared the water in Dimock safe. EID has a detailed factsheet on the EPA’s involvement in Dimock, but to summarize, following a request from Gasland director, Josh Fox, the EPA stepped into Dimock and tested the water at 60 homes. The agency concluded:

  • On March 15, 2012, the EPA released its first round of water testing from 11 homes in Dimock, which “did not show levels of contamination that could present a health concern.”
  • On April 6, 2012, the EPA released more water sampling data from Dimock, indicating that the water does not pose a threat to resident’s health. All contaminates found are also naturally occurring.
  • On April 20, 2012, EPA released yet another round of water testing data from Dimock. EPA concludes: “This set of sampling did not show levels of contaminants that would give EPA reason to take further action.”
  • The EPA released its final findings from Dimock on July 25, 2012, concluding: “Overall during the sampling in Dimock, EPA found hazardous substances, specifically arsenic, barium or manganese, all of which are also naturally occurring substances, in well water at five homes at levels that could present a health concern. In all cases the residents have now or will have their own treatment systems that can reduce concentrations of those hazardous substances to acceptable levels at the tap. EPA has provided the residents with all of their sampling results and has no further plans to conduct additional drinking water sampling in Dimock.”

Déjà vu: This verdict is awfully similar to the 2014 decision Wise County, Texas

This decision is not necessarily the final verdict, despite the way the anti-fracking activists will characterize it. That case never had anything to do with fracking, after all. What it is, though, is highly reminiscent of a case that took place in Wise County, Texas back in 2014.

This too was a nuisance claim against an oil and gas company where there was absolutely no scientific evidence for a jury to award money to the plaintiffs – yet that’s exactly what they did. Here’s a recap from David Blackmon in a 2014 piece in Forbes:

“The jury was able to consider this claim based on layman observations of possible cause and effect, since no scientific cause and effect evidence was presented at trial. Thus, no expert testimony was necessary to make a finding of liability, and the jury was able to award damages from any air emissions regardless of lack of evidence of causation of any of the ill effects the Parr family says it has suffered. Very few media stories on this case mentioned any of this, which should come as no surprise.

Based on this very low bar, and even though Aruba’s nearest well was more than 1,000 feet from the Parr residence, even though there had been no finding of excess emissions over state or federal air quality standards from any Aruba facility, and even though the Parr family was apparently so unconcerned about Aruba’s operations that it agreed to take out another pipeline easement lease with Aruba even after they filed the complaint against the company, the jury awarded almost $3 million in damages on this nuisance claim. Truly, you have to love the U.S. court system.”

Substitute in water contamination and you really could be reading about today’s verdict. Like the case in Texas, this verdict can be set aside because of this lack of evidence or it could be overturned in appeal, but only time will tell if this will be the final chapter in Dimock’s story.

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