Oklahoma Court Rules Homeowners Can Sue Oil and Gas Companies
In a 7-to-0 ruling last week, the Oklahoma State Supreme Court is allowing homeowners who have sustained injuries or property damage from earthquakes blamed on oil and gas company drilling operations to sue for damages in state courts.
This ruling is the first in which the court has specifically addressed whether homeowners could sue for damage believed to be caused by the massive amounts of wastewater injected into the ground by oil and gas drilling in the hydraulic fracturing—fracking—process, the New York Times reports.
The pressure of wastewater injected into underground disposal reservoirs near fault zones is believed to trigger earthquakes. Oklahoma has borne the brunt of fracking-related quakes in recent years, the Times reports. Before the fracking boom, Oklahoma typically had just one or two 3.0-magnitude or higher quakes each year. But the number has risen steadily in the last past decade, with 585 such quakes last year, and the state on a pace for 1,100 quakes 3.0 or greater this year. That total is more than for any state except Alaska, and Oklahoma, according to the Times.
The tiny town of Prague was hit by several of the state’s worst quakes November 2011, including one of 5.7 magnitude and one of 5.0. Sandra Ladra suffered serious knee and leg injuries when the chimney of her home crumbled in an earthquake and she was hit by falling stone, the Times reports. She filed suit against two companies that operate nearby wastewater disposal wells that she believed caused the quakes. The lawsuit was dismissed. Industry attorneys argued that the proper venue for a dispute over wastewater-related quake damage is the Corporation Commission, a state regulatory agency. Ladra’s attorney appealed the dismissal, which resulted in last week’s court ruling. The attorney is now proceeding with both the Ladra case and a separate class-action lawsuit related to the 2011 quakes, according to the Times.
In the ruling, the court did not take a position on whether wastewater disposal wells caused the quake that injured Ladra and damaged her home, though the justices did note the “dramatic increase in the frequency and severity of earthquakes” in the state. In explaining their ruling, they cited “the long-held rule that district courts have exclusive jurisdiction over private tort actions when regulated oil and gas operations are at issue,” according to the Times.
Oklahoma’s top officials had long asserted that a link between earthquakes and wastewater disposal was not clear, but in April they reversed themselves, accepting the scientific consensus on the issue, citing a state geological survey determination that “the majority of recent earthquakes in central and north-central Oklahoma are very likely triggered” by wastewater disposal wells. Industry official say more study is required, the Times reports.
The state legislature has passed a law restricting municipalities from regulating oil and gas wells within their jurisdiction. The drilling industry is also seeking passage of a law requiring a state-approved expert to first certify any lawsuits over wastewater-induced quakes, which could make it more difficult for homeowners to bring suit over earthquake damage.
