Northern District of Texas Court Dismisses Claims Against Hogan Thompson Schuelke Client Ovintiv

The Northern District of Texas granted Hogan Thompson Schuelke’s motion to dismiss on a claim brought against client Ovintiv for underpayment of royalties in TLLM Family Limited Partnership v. Ovintiv USA. A landowner, TLLM, filed a lawsuit against Ovintiv claiming that it was underpaid for oil and gas royalties. TLLM said that Ovintiv should not be permitted to charge TLLM its proportionate share of costs that Ovintiv incurs for the transportation, processing and marketing of oil and gas (commonly called “postproduction costs”).

The case was removed to federal court and before Judge James Wesley Hendrix of the Northern District of Texas. Represented by Hogan Thompson Schuelke, Ovintiv filed a motion to dismiss the claims related to royalty underpayments, based on Texas caselaw saying that the lease between the parties permits Ovintiv to pass along to the lessor (TLLM) its share of those postproduction costs. Judge Hendrix agreed with Ovintiv and granted Ovintiv’s motion to dismiss and dismissed all claims pending against Ovintiv. 

“Texas royalties law is one of my favorite areas of oil and gas law, and it’s great when a judge digs into the law like Judge Hendrix did in this case,” noted partner Chris Hogan. 

Chris Hogan and John Mondel represented Ovintiv.