Naylor Farms v. Chaparral Energy

Defendant Chaparral Energy, L.L.C. (Chaparral) operated approximately 2,500 oil and gas wells in Oklahoma. Plaintiffs Naylor Farms, Inc. and Harrel’s, L.L.C. (collectively, Naylor Farms) had royalty interests in some of those wells. According to Naylor Farms, Chaparral systematically underpaid Naylor Farms and other similarly situated royalty owners by improperly deducting from their royalty payments certain gas-treatment costs that Naylor Farms contended Chaparral was required to shoulder under Oklahoma law. Naylor Farms brought a putative class-action lawsuit against Chaparral and moved to certify the class under Rule 23 of the Federal Rules of Civil Procedure. The district court granted Naylor Farms’ motion to certify, and Chaparral appealed the district court’s certification order. After review, the Tenth Circuit concluded Chaparral failed to demonstrate the district court’s decision to certify the class fell outside “the bounds of rationally available choices given the facts and law involved in the matter at hand.” View "Naylor Farms v. Chaparral Energy" on Justia Law