Dimock: Judge rules Monica and Scott Ely lawsuit against Cabot Oil for methane contamination of their water can proceed with a negligence claim

Lawsuit against Cabot Oil can proceed by Terrie Morgan-Besecker, June 11, 2014, Times-Tribune
A Dimock Twp. couple suing Cabot Oil & Gas Corp. over their methane-contaminated well should be permitted to proceed with a negligence claim, but other counts in the suit should be dismissed for lack of evidence, a federal magistrate judge said. U.S. District Magistrate Judge Martin C. Carlson said Scott Ely and his wife, Monica, have presented sufficient evidence to support their claims that Cabot’s drilling of Marcellus Shale wells near their home may have contaminated their well water. But they failed to provide enough evidence to uphold several other counts, including breach of contract, fraud and claims for medical monitoring. The Elys were among 44 Dimock Twp residents who sued Cabot in 2009, alleging its drilling operations contaminated their wells with methane. Cabot settled with 40 of the plaintiffs in 2012, but the Elys rejected the deal and continued with the suit, acting as their own attorney.

Attorneys for Cabot filed a motion seeking to dismiss all claims. Judge Carlson was assigned to review the case and recommend whether it should be permitted to proceed. His report will now be reviewed by a federal judge, who will have the final say. The Elys’ suit sought compensation for damages caused by the alleged contamination of their well and to require Cabot to pay for medical monitoring. They also alleged Cabot breached its lease contract with them in several ways, including failing to properly pay them royalties, and that the company fraudulently induced them to enter into the lease.

In support of their contamination claims, the Elys presented reports by a hydrologist and an engineer who concluded Cabot was responsible for contaminating the aquifer feeding the Elys’ water supply. Cabot disputed the accuracy of the reports, but Judge Carlson said he believes that issue is a disputed fact that should be addressed by a jury.

The judge agreed with Cabot that the Elys’s breach of contract claim, which alleged Cabot failed to make regular and timely payments of royalties, was meritless. He also rejected the fraud claim, which alleged Cabot fraudulently induced them into signing the lease by telling them it would extract natural gas from their land whether they signed the lease or not. Judge Carlson said the Elys’ contract did not provide for a specific timetable for payments, therefore there is no breach. As for the fraud charge, the judge said the Elys presented no evidence to support their claims that Cabot officials made the statements they allege. The judge also said the Elys failed to produce any evidence that they might be at increased risk for health problems that would require medical monitoring. [Emphasis added]

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