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Aukema v. Chesapeake Appalachia, LLC

United States District Court for the Northern District of New York

November 15, 2012, Decided; November 15, 2012, Filed

3:11-CV-00489

Opinion

 [*201]  MEMORANDUM-DECISION and ORDER

I. INTRODUCTION

Plaintiffs Douglas and Patricia A. Aukema and other landowners1 (collectively "plaintiffs") brought this declaratory judgment action against Chesapeake Appalachia, LLC ("Chesapeake") and Statoilhydro USA Onshore Properties, Inc. ("Statoil") (collectively "defendants") seeking a declaration that certain oil and gas leases entered into between the parties expired at the conclusion of the primary terms of those leases and that the terms have not been extended by payment or force majeure.2 See Am. Compl.. Plaintiffs also charge defendants with violating New York General Business Law section 349. Id.  [**2] Defendants assert counterclaims seeking a declaration that the leases were extended due to force majeure events and the tender of payments.

Plaintiffs moved for partial summary judgment declaring that the leases have expired and directing defendants to file a release of the leases in accordance with New York General Obligations Law section 15-304. Defendants opposed plaintiffs' motion and cross-moved for summary judgment declaring that the leases were extended and are in full force and effect, and  [**3] dismissing plaintiffs' amended complaint. Plaintiffs opposed defendants' motion and replied in support of their motion. Defendants replied in support of their motion.

 [*202]  Defendants also moved to strike the reply affidavit of plaintiff's expert David W. Keefe, dated August 16, 2012. Plaintiffs opposed.

Oral argument was heard on August 30, 2012, in Utica, New York. Decision was reserved.

II. BACKGROUND

A. Oil and Gas Industry in New York State

Gas drilling in New York State is governed by the Environmental Conservation Law. Under the authority of that statute, the State Environmental Quality Review Act ("SEQRA"), N.Y. Envtl. Conserv. Law section 8-0101, was passed "to inject environmental considerations directly into governmental decision making." City Council of Watervliet v. Town Bd. of Colonie, 3 N.Y.3d 508, 515, 822 N.E.2d 339, 341, 789 N.Y.S.2d 88 (2004) (internal quotations omitted).

SEQRA requires all New York State agencies, including the New York State Department of Environmental Conservation ("DEC"), to prepare or cause to be prepared an Environmental Impact Statement ("EIS") for "any action . . . which may have a significant effect on the environment." N.Y. Envtl. Conserv. Law § 8-0109(2).3 Where  [**4] the impacts from separate actions are common and predictable, a generic EIS ("GEIS") may be prepared to analyze the impact of all such actions generally and cumulatively instead of preparing an individual (or site-specific) EIS for each action. See N.Y. Comp. Codes R. & Regs tit. 6, § 617.10(a). The purpose of a GEIS is to provide a comprehensive review of the potential environmental impacts of an activity and how those impacts could be mitigated. Subsequent proposed actions which may significantly affect the environment, but which are not adequately addressed by a GEIS, require either a supplemental GEIS ("SGEIS") or a site-specific EIS. See id. § 617.10(d)(4); N.Y. Envtl. Conserv. Law § 8-0109(2).

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904 F. Supp. 2d 199 *; 2012 U.S. Dist. LEXIS 163175 **; 179 Oil & Gas Rep. 182; 2012 WL 5522832

DOUGLAS AUKEMA; PATRICIA A. AUKEMA; JESSE BARNHART; CHARITY A. BARNHART; SCOTT H. BODINE; CONNIE M. BODINE; ANTHONY BURCHELL; CYNTHIA BURCHELL; GARY W. BURCHELL; CLIFFORD CASTLINE; ALICE CASTLINE; BRUCE T. COOK; AMY M. COOK; GAIL P. FISHER; DOUGLAS GREENE; HERBERT A. HIBBARD; DANIEL L. HIBBARD; MARY B. HIBBARD; AUGUST HIEMSTRA; LESLIE J. HIEMSTRA; JOHN P. HRICIK; SUSIE A. HRICIK; STELLA HRICIK; STEFAN JAKUBOWSKI; JADWIGA JAKUBOWSKI; JAMES P. KEESLER; ELIZABETH F. KEESLER; JOSEPH W. KELLICUTT; DORLEEN KELLICUTT; MICHAEL J. KELLICUTT; SUSAN KELLICUTT; ROBERT D. KUZEL; CHERYL A. KUZEL; CHARLES W. LEE; SUSAN F. LEE; GARY A., LEE; MARY S. LEE; EDDIE W. MASLIN; CAROL M. MASLIN; PIETRO MAUCERI; GUISEPPINA MAUCERI; JARRETT D. NEWBY; NANCYJ. NEWBY; ORRIN G. PENDELL; EDWARD RUTKOWSKI; DONNA RUTKOWSKI; DAVID W. SCHAEFFER; JOAN P. SCHAEFFER; GARY L. SMITH; KIM SMITH; DOROTHY SMITH; NORMAN J. SWEENEY; RUTH A. SWEENEY; DANIEL J. WILLIAMS; CHARITY J. WILLIAMS, Plaintiffs, -v- CHESAPEAKE APPALACHIA, LLC and STATOILHYDRO USA ONSHORE PROPERTIES, INC., Defendants.

Prior History: Aukema v. Chesapeake Appalachia, LLC, 839 F. Supp. 2d 555, 2012 U.S. Dist. LEXIS 38711 (N.D.N.Y, 2012)

CORE TERMS

leases, drilling, oil, majeure, lessee, Leasehold, rental, environmental, royalty, Shale, expired, formations, frustration, horizontal, habendum, constituents, prescribed, site-specific, conventional, fracturing, terminated, Covenants, withdrawn, Lessor