Attorney Says Cabot Oils Use of DEP Consent Order Improper

Plaintiffs' attorneys claim clients were contacted directly and asked to waive their rights to sue Cabot Oil, which used hydraulic fracturing in Pennsylvania, because they were getting compensation through a state consent order.

Attorneys of Napoli Bern Ripka & Associates, LLP, representing plaintiffs in Dimock, Pa., who have sued Cabot Oil & Gas Corporation (Fiorentino v. Cabot Oil & Gas Corp., USDC-Middle District of PA., Docket No.: 3:09-CV-02284) for contamination of their drinking water announced that Cabot and its attorneys have attempted to use a consent order entered with the Pennsylvania Department of Environmental Protection (DEP) to allegedly mislead their clients into waiving their rights to continue the litigation.

The Dimock plaintiffs have sued Cabot Oil over its use of hydraulic fracturing.

The DEP determined that Cabot had failed to complete its obligations under an earlier consent order by failing, among other things, to "permanently restore and replace water supplies" and also failing to "completely eliminate the unpermitted discharge of natural gas into the waters of the Commonwealth" from its gas wells in the Dimock/Carter Road areas. As a result, the DEP entered a consent order with Cabot on Dec. 15. The order requires Cabot to do a number of things, including paying the greater of $50,000 or two times the assessed value of the [affected] property into 19 escrow funds to "pay for or restore and/or replace the water supplies or to provide for ongoing operating or maintenance expense," according to a release from the plaintiffs' attorneys.

This money was to be paid without any obligation on the part of the property owner, a number of whom have been involved in civil litigation against Cabot in the United States District Court for the Middle District of Pennsylvania.

Cabot's agent reportedly telephoned a number of the plaintiffs directly on Dec. 17. Cabot's attorneys say in a Dec. 20 letter to the Napoli office that the agent's calls were not a violation of Rule 4.2 of the Pennsylvania Disciplinary Code for Attorneys, which precludes directly contacting an adversary, known to be represented by counsel, because the agent is not himself an attorney.

In addition to advising plaintiffs, all of whom are represented by legal counsel, that Cabot was required to test their water supply under the consent order, Cabot also reportedly told those plaintiffs that they would be required to sign releases of all of their claims against Cabot in the litigation to obtain the payment already due them under the consent order. Nothing in the consent order with DEP requires the plaintiffs to sign such releases and signing the release would have foreclosed the plaintiffs' ability to continue to seek damages in their civil suit, the plaintiffs' attorney said.

The damages claimed against Cabot are far higher than the amounts Cabot is required to pay by the DEP consent order.