Shook Attorneys Step In To Enforce Settlement Agreement

When a member of a longstanding consortium of gas owners purported to withdraw from a Wichita processing plant, the plant’s operator filed suit against all of the other plant owners, claiming that none of the plant owners could withdraw without the permission of the operator. A mediation was conducted in October 2013 that resulted in a two-part settlement. The first part, between the plant operator and the withdrawing gas producer, set out all the material terms for settling the lawsuit; counsel for the withdrawing owner also added a provision stating that these terms were immediately enforceable. The second part, between the remaining plant owners, contemplated that those owners would work out the terms under which they would continue to operate the plant. The withdrawing gas producer enjoyed the benefits of the agreement immediately, terminating his relationship with the plant in November 2013. A year and a half later, the remaining plant owners likewise worked out how they would continue without the departed owner.

In the meantime, however, changes in circumstances threatened to derail the settlement. First, counsel representing Linn Energy and some other plant owners developed a conflict. Another Wichita attorney referred Linn to Gene Balloun. Second, as the other plant owners worked out the operating arrangements for the plant, the gas market became disrupted by plummeting gas prices. Seeing this, the principal defendant wanted to withdraw his agreement to pay about $1,000,000 into an environmental cleanup fund that would benefit Linn and the other plant owners. Suddenly, the party whose lawyer demanded that the settlement agreement was immediately enforceable was now claiming that he had no settlement agreement at all.

Eventually, the other plant owners asked Gene to take the lead in attempting to enforce the settlement agreement. A motion to enforce the settlement agreement was fully briefed by all of the parties. Gene and Scott DuPree authored a brief detailing the relevant law and the reasons why the agreement should be enforced. Gene then argued the motion in an all-day hearing before the District Court in Wichita. At the conclusion of the hearing, the District Judge ruled in favor of Shook's client, holding that the settlement agreement should be enforced.