Professional Documents
Culture Documents
PLAINTIFF
County, Arkansas, and is, by appointment of the Circuit Court of St. Francis
County, the class representative for all members of the class certified in the matter
attorneys who are involved in the matter of Connie Jean Smith v. SEECO, DeSoto
Gathering, Southwestern Energy Services Company and Southwestern Energy
Company. (Smith v. SEECO)
The individual Defendant Lawyers are as follows:
Ben H. Caruth, Morrilton, AR. ; Jason E. Roselius, Oklahoma City, Ok;
Brad E. Seidel, Austin Tx.; Edward Allen Gordon, Morrilton, AR.; Tanner W.
Hicks, Oklahoma City, OK.; Erik P. Danielson, Fayetteville, Ar.; Sean M.
Handler, Radnor, Pa.; Brian L. Cramer, Oklahoma City, Ok.; Jack A. Mattingly,
Jr. Seminole, Ok.; Andrew King, Little Rock, Ar.; Frederick H. Davis, Little
Rock, Ar.; Jess L. Askew, Little Rock, Ar.; Michael Vance Powell, Dallas, Tx.;
Marc Tabolsky,
Kansen, Dallas, Tx.; Rex M. Terry, Fort Smith, Ar.; Paul Yetter, Houston, Tx.;
and Thomas A. Daily, Fort Smith, Ar.
Defendants Caruth, Roselius, Seidel, Gordon, Hicks, Danielson, Handler,
Cramer, and Mattingly are appointed class counsel in the matter of Smith v.
This matter was originally filed in the Circuit Court of St. Francis
County Arkansas. The SWN Defendants filed a notice of removal in the Circuit
Court of St. Francis County, and pursuant to that Notice of Removal, this matter
has been lodged with this United States District Court.
Facts and Allegations
4.
against SEECO,
were appointed as class counsel by Judge Simes. Your Plaintiff herein, Stephanie
DeVazier,
Francis County following the death of Mrs. Stewmon, who was appointed as the
original class representative.
6.
On July 25, 2014, the Caruth Defendants herein filed a case in the
United States District Court for the Eastern District of Arkansas on behalf of outof- state persons who had SEECO leases.
v. SEECO,
et al class was certified by the Circuit Court of St. Francis County. At that time,
the Smith v. SEECO case in federal court had yet to even have the initial Rule 26
Scheduling Conference, (the beginning point of federal cases).
8.
the
Stephanie
On April 11, 2016 the United States District Court for the Eastern
months after the certification of the Stewmon class. (As related above, the
Stewmon v. SEECO et al class remains certified and attorneys Wilson, Easley
and Holton are class counsel for all members of that certified class).
10.
members of the class certified in Smith v. SEECO by motion on May 11, 2016.
The SWN Defendants herein have responded to the Motion to Approve Notice as
submitted by the Caruth Defendants.
11.
All residents of the State of Arkansas who entered into leases with
Defendant SEECO (up through September 27, 2013) for the development and
operation of natural gas wells on property located in the State of Arkansas and
who signed leases allowing for deduction of reasonable costs for gathering,
compression, treatment and marketing. Specifically excluded are any leases which
have non-Arkansas residents as parties to the lease.
12. Class certification gives rise to an attorney-client relationship between
potential class members and class counsel. Gortat v. Capala Bros., Inc., 2010 WL
1879922, at *2 (E.D.N.Y. 2010).
Pursuant to the class certification order which remains in full force and
effect, attorneys Wilson, Easley and Holton represent:
All residents of the State of Arkansas who entered into leases with
Defendant SEECO (up through September 27, 2013) for the development and
operation of natural gas wells on property located in the State of Arkansas and
who signed leases allowing for deduction of reasonable costs for gathering,
compression, treatment and marketing. Specifically excluded are any leases which
have non-Arkansas residents as parties to the lease.
13.
Wilson, Easley and Holton, have a duty to act as a fiduciary who must serve as
guardian of the rights of absent class members. Ballard v. Martin, 349 Ark. 564,
575 (Ark. 2002) citing Grunin v. Intl House of Pancakes, 513 F.2d 114, 121 (8th
Cir. 1975).
14.
class members would be detrimental to them and their causes of action because of
certain conduct of the Defendants herein which has created an absolute conflict of
interest between the Defendants and members of the Stewmon v. SEECO et al.
class and its representative, Plaintiff Devazier.
17. The conflict of interest between these Defendants on the one hand and
the members of the Stewmon v. SEECO et al. class and its representative,
Plaintiff Devazier, on the other is such that it cannot be remedied or papered over.
Further, the conduct of these Defendants as set forth in the subsequent
paragraphs in this complaint,
interests of the
Plaintiff herein and members of her class. As such, allowing any notice to issue
from these Defendants directly to the members of the Stewmon v. SEECO et al.
class would directly harm the Plaintiff and members of her class.
the SWN
To that end,
the SWN Defendants asked the Caruth Defendants to contact counsel in Snow v.
SEECO. (Snow is another class action case which was filed against SEECO only,
and includes only Arkansas residents. Snow was certified after Stewmon v.
SEECO et al. was certified and does not encompass all of the Stewmon v.
SEECO et al. defendants, nor does it include all of the valid and viable causes of
action included in Stewmon v. SEECO et al.)
At the behest of the SWN Defendants,
instructed to see if the Snow counsel were willing to explore a global resolution to
all claims against SEECO, nationwide.
20.
California to engage in mediation to try and achieve a global settlement, all the
while maintaining their agreement to not tip off class counsel or the class
representative for the Stewmon v. SEECO et al. class to these negotiations
which, if successful, would directly impact the members of the Stewmon v.
SEECO et al. class.
21. By agreeing to hide these negotiations from the Stewmon v. SEECO et
al. class counsel and class representative, all while knowing that the Stewmon
class was already a certified class with appointed class counsel,
the Caruth
Defendants and their client, Connie Jean Smith, colluded with the SWN
Defendants in a way which was materially adverse to the interests of the members
of the Stewmon v. SEECO et al. class which includes your Plaintiff and her
absent class members (all of whom now fall within the class definition in Smith v.
SEECO and who would receive any notice issued in Smith unless Plaintiffs relief
is granted).
22.
Shortly after the secret mediation, the entire scheme became public
during a hearing in front of Hon. Billy Roy Wilson to whom the Smith v. SEECO
case was originally assigned.
-- your freedom to act zealously for your putative class in exchange for fees or
something with a third party in a different class, that agreement is not only
discoverable, it is something that the Court and the putative class needs to know
about. (emphasis added).
23. Judge Wilson did not order production of any such agreements because
he was not inclined to certify a class in Smith v. SEECO at that time. However,
Judge Wilson added : if there's something of the nature you're suggesting that I
find out, I'll ask about it at a later time, if I start to certify the class.
24.
Yetter and his co-counsel were making efforts to challenge the adequacy of
Smiths counsel because of collusion between the Caruth Defendants herein and
counsel for Snow in the state case.
adequacy of the Caruth Defendants herein to represent the Smith v. SEECO class
members disappeared once the SWN Defendants herein had a class certified which
hijacked the state court class actions to what all the Defendants herein perceived as
a more favorable venue.
Indeed, the certification of the broader Smith class was the culmination of
SEECOs stated intention of rushing a nationwide class action through their chosen
forum in federal court so as to strip the Arkansas state courts of jurisdiction.
25.
and all the prior concerns about the adequacy of the Caruth
had first-hand knowledge that Smiths counsel had colluded and conspired with
SEECO in certifying the broader class and in hiding the mediation aimed at
global resolution from duly appointed class counsel in Stewmon v. SEECO et
al. The SWN Defendants and the Caruth Defendants through their collusion have
acted in a way which is materially adverse to your Plaintiff herein, and the
members of the Stewmon v. SEECO et al. class who she has been appointed to
represent.
has led to the appointment of class counsel who have acted adversely to the
members of the Stewmon v. SEECO et al. class members who are included in
their class.
Even more concerning however is the fact that two of the law firms
appointed to represent the Smith v. SEECO class have been involved in improper
class action conduct in a case which was pending in the Western District of
Arkansas. In fact, one of the Caruth Defendants herein who has been approved as
class counsel in Smith v. SEECO was found to have acted in bad faith and in
violation of Rule 11 for conduct in a class action which was pending in the
Western District of Arkansas.
The Caruth Defendants herein include attorneys with two out of state law
firms, the Mattingly & Roselius Law Firm and the Kessler, Topaz, Meltzer &
Check Law Firm. Members of these two law firms have been appointed as class
counsel in the Smith v. SEECO case.
29.
action which was filed in the United States District Court for the Western District
have
telling.
Adams in that Roselius and the other Caruth Defendants herein have colluded with
the SWN Defendants in efforts to make end-runs around the certified Stewmon v.
SEECO et al class by their covert attempts at a mediation which was strategically
hidden from Stewmon class counsel but was purportedly aimed at a global
resolution.
originally sought for the purpose of stripping the state courts of their jurisdiction,
all of your Defendants herein have also colluded for the improper purpose of
seeking a more favorable forum and avoiding an adverse decision.
32.
vanished with SEECOs counsels failure to challenge in any way the adequacy of
the flawed counsel appointed to serve as class counsel in Smith, which amounts to
tacit agreement with their appointment, or at a bare minimum complacency. In the
face of SEECOs counsels first-hand knowledge of the Caruth Defendants
conflict of interest, and in their failure to inquire as to the Rule 11 violations which
are detailed herein, SEECO has abandoned an adversarial position for their stated
intention of rushing through a broader class action in federal court.
33.
SEECO, has similarly failed to carry out her fiduciary duties to all class members
by failing to question the ability of her counsel to act in the best interests of her
absent class members.
34.
A failure to provide the Plaintiff the requested relief would subject her
absent class members, whom she is charged with vigorously and tenaciously
protecting, to communications which would materially mislead those absent class
members about the nature of Smith v. SEECO, about the material conflicts posed
by the inadequate class counsel and class representative appointed therein, and
would wholly omit an honest description of the collusion and conspiring which has
occurred between your Defendants herein to date.
Without full disclosure of the collusion, conflicts of interest and disciplinary
history of class counsel, no absent class member could make an intelligent decision
with regard to this class action, and as such, they would be denied their due process
rights which are supposed to be protected and safeguarded by the Court, Berger v.
Compaq Computer, 257 F3d 475, 480 (5th Cir. 2001).
Defendants shows itself once again in the proposed class notice which has been
filed by Smiths counsel. To begin, the brief mention of Stewmon v. SEECO et
al which is included in the proposed notice would leave the absent class member to
believe that to opt-out of Smith so as to proceed in the previously certified
Stewmon state court action would expose them to higher legal fees and/or expert
witness fees, which is completely false.
SEECO et al would be subject to award and approval by the Circuit Court of St.
Francis County. Also, the proposed notice makes no mention of the conflict
between the Defendants herein and the Plaintiff and members of her class which
was created when these Defendants agreed to secret negotiations which they kept
secret from the class counsel and class representative of the Stewmon v. SEECO
et al class.
36. The collusion between the Caruth Defendants and the SWN Defendants
continues by agreeing to certify the broader class in an attempt to hijack or usurp
the Arkansas state courts jurisdiction, and by conspiring to communicate directly
with your Plaintiff herein and her class members instead of through their court
appointed counsel. The proposed notice also sets a shortened time frame of 45
days for individuals to opt out of the class, instead of the recommended time frame
of 90 days.
37.
name/property number for any well which they wish to exclude. The property
name/property numbers are not easily ascertained by absent class members as this
may entail reviewing numerous documents to determine the specific well name and
property number which has been assigned in the SEECO owner system.
By
making this a requirement for opting out of the Smith v. SEECO class, it creates
an undue burden on absent class members which is unnecessary and not designed
to further any legitimate objective in terms of the Smith v. SEECO class action.
39.
who were appointed in Stewmon, not only would it violate that attorney-client
relationship, it would act to give the absent class members biased and incorrect
information about their rights. It would fail to fully and completely apprise them
of the problems with the Caruth Defendants who are appointed as Smiths class
counsel including the Rule 11 violations. It would also fail to inform them of the
direct conflict of interest the Caruth Defendants have as it relates to the absent
Stewmon class members whose appointed class counsel and class representatives
were specifically excluded from the secret global settlement negotiations.
40.
harmful and biased communications with your Plaintiff and the members of her
certified class whom they conspired and colluded against, such communications
would improperly bypass Devazier and duly appointed class counsel completely,
and have the effect of nullifying her appointed position, and violating the duties
entrusted to her, and so would also injure her personally, as well as in her
representative capacity.
42.
this Court to enjoin the Defendant Lawyers herein from committing acts which (A)
violate Rules 4.2 and 7.3 of the Arkansas Rules of Professional Conduct, and
ARCP 23 (B) are not in the best interests of the class of Arkansas royalty owners
certified by the late Judge Simes and (C) are harmful to Devazier and the absent
class members of the Stewmon class whom the Defendants conspired and colluded
against.
natural gas wells on property located in the State of Arkansas and who signed
leases allowing for deduction of reasonable costs for gathering, compression,
treatment and marketing. Specifically excluded are any leases which have nonArkansas residents as parties to the lease.
Plaintiff further prays that any communication involving any of the
aforementioned class of persons be sent only to their duly appointed class counsel,
E. Dion Wilson, B. Michael Easley and Timothy R. Holton, or in the alternative,
with the express consent of their appointed counsel.
Lastly, Plaintiff prays for all other relief, both general and specific to which
Plaintiff and her class are entitled to under the facts set forth herein above.
Respectfully Submitted,
/s/Timothy R. Holton
Timothy R. Holton (2001101)
John R. Holton (2009056)
296 Washington Ave.
Memphis, TN 38103
(901)523-2222
Tholton@holtonlaw.com
Jholton@holtonlaw.com
CERTIFICATE OF SERVICE
I do hereby certify that I have served a true and exact copy of the foregoing
document via the Electronic Case Filing system on this 31st day of May, 2016.
/s/Timothy R. Holton