Class Action Arbitration in Oil And Gas Leases

By Paul R. Yagelski, Esq.
Rothman Gordon
Pittsburgh, Pennsylvania

Under What Circumstances Can a Class Action Arbitration Take Place Where An Oil and Gas Lease Is Involved?

In Marbaker v. Statoil U.S.A. Onshore Properties, Inc., 801 Fed. Appx. 56 (3rd 2020), the Third Circuit Court of Appeals addressed the circumstances under which a class action arbitration can take place where oil and gas leases are involved.

In Marbaker, Alan and Carol Marbaker (and two other landowners) alleged that Statoil underpaid them royalties on their oil and gas leases. The leases had arbitration clauses. The Marbakers asked the District Court to declare either that: (1) Statoil had waived any right to enforce those clauses or else (2) those clauses allowed class arbitration. The District Court dismissed the suit, rejecting the waiver claim as unripe and the class-arbitration claim on the merits.