An Oklahoma judge withdrew a temporary restraining order Tuesday against a Fort Worth attorney who was urging landowners to challenge the $119 million settlement of a class action lawsuit against Chesapeake Energy.
State District Judge Jon Parsley lifted a measure that prevented McDonald from sending out mass mailers, buying newspaper ads or conducting public meetings where he says the settlement will pay plaintiffs little while attorneys get $48 million in fees.
Parsley was scheduled to hold a hearing on the matter Wednesday morning in his remote Oklahoma Panhandle courtroom in Beaver County. The attorneys who negotiated the settlement accused McDonald of conducting an “unethical solicitation campaign.”
McDonald had filed a lengthy response to Parsley’s temporary restraining order, saying that it was improper and violated his First Amendment rights to free speech, among other things.
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“I maintained all along that I didn’t do anything wrong in Oklahoma and Judge Parsley’s order speaks for itself and says just that,” McDonald said. “This is no surprise.”
Rex Sharp, the attorney who asked for the order, did not return phone calls seeking comment. But Parsley’s order says the counsel in the case was withdrawing its motion for the temporary injunction and order.
Parsley is presiding over a lawsuit filed in 2010 that accused Chesapeake of underpaying oil and gas royalties by improperly deducting postproduction costs — claims similar to those made by McDonald and other attorneys in North Texas.
Classified as a class action by Parsley in February 2013, the suit covers drilling going back to 2004 and claims by thousands of royalty owners involving possibly 10,000 wells.
In January, Chesapeake agreed to settle for $119 million. Attorneys’ fees of up to 40 percent would be paid from that total, which could leave about $71 million for the plaintiffs.
Parsley set a schedule under which notices describing the settlement would go out to plaintiffs and set an April 1 deadline for individuals to object to or opt out of the settlement. On April 17, Parsley is set to hold a “settlement fairness hearing” for final arguments in the case.
But before many of the plaintiffs had time to consider the settlement, McDonald began questioning it, saying it “stinks.” He said the royalties were miscalculated by at least $1 billion. Sharp and others said McDonald’s action caused “unnecessary” confusion.
If the order had been left in place, McDonald would have been shut down in his attempts to take on Chesapeake in its home state.
Max B. Baker, 817-390-7714