What’s In A Name? A Lawsuit
ST. CLAIRSVILLE – Robert Murray said he had a hard enough time dealing with natural gas companies who tried to drill through American Energy Corp. coal seams last year.
But when former Chesapeake Energy chief executive officer Aubrey McClendon decided to start a new company named American Energy Partners that is acquiring assets with the intent to drill throughout Ohio’s Utica Shale, Murray decided he had gone too far.
Murray, founder and chief executive officer of Murray Energy Corp., on Friday announced he is suing McClendon for “misappropriation and infringement of American Energy Corp.’s trade name.”
Murray claims McClendon – whom he refers to as a “wildcatter,” a term used to describe natural gas drillers that some industry leaders consider insulting – is violating the Ohio Deceptive Trade Practices Act and the Ohio Common Law of Unfair Competition.
Murray operates the Century Mine near Beallsville as an American Energy Corp. subsidiary. Last year, Murray had a dispute with Oxford Oil Co. after that driller initially got permission from the Ohio Department of Natural Resources to drill wells through coal seams at the Century Mine. The ODNR eventually did not allow these wells to proceed after Murray objected for safety reasons.
Murray also operates the Powhatan No. 6 mine, while he continues to operate the Redbird West Mine in Jefferson County. Murray recently said 810 employees work at the Century Mine, with another 684 at Powhatan No. 6 and 66 at Redbird West. Together, the mines paid about $57.2 million in federal, state and local taxes last year.
As for McClendon, he resigned as Chesapeake CEO April 1. The company he founded in 1989 remains the most active natural gas and oil driller in West Virginia’s Northern Panhandle, while also maintaining operations throughout eastern Ohio. Over the past few years, McClendon took a 2.5-percent personal interest in Chesapeake’s operations in Brooke, Ohio, Marshall and Wetzel counties. This left some investors concerned because Chesapeake is a publicly traded company on the New York Stock Exchange, while McClendon’s firms – Larchmont Resources and Jamestown Resources – are his own private businesses.
McClendon recently started American Energy Partners, which, like Chesapeake, is based in Oklahoma City. The company states on its website that, “Under the leadership of Aubrey K. McClendon, American Energy Partners has a singular purpose: To capture some of the vast opportunities available today in America’s oil and natural gas industry.”
A Friday call to McClendon’s new company seeking comment was not returned.
Murray said McClendon is “attempting to cause confusion in the marketplace and further his goal of eliminating the use of coal in America.”
In late June, President Barack Obama announced he had directed the U.S. Environmental Protection Agency to crack down on carbon emissions, specifically those coming from coal-fired power plants, to “prepare our nation for the unavoidable impact of climate change.” The president has said he plans to promote the use of natural gas as a replacement fuel for coal, even though the EPA states that the venting of unburned methane can be up to 20 times more harmful to the atmosphere than the burning of coal.
Murray alleges McClendon donated “at least $51.5 million to the Sierra Club and American Lung Association to eliminate the use of coal …”
The Sierra Club – an environmental lobbying group with 2.1 million members – calls coal an “outdated, backward and dirty 19th-century technology.” According to OpenSecrets.org, the Sierra Club donated $452,010 to various Democrat candidates for Congress in 2012, but gave nothing to Republicans. The Sierra Club claims that burning coal leads to “as many as 13,000 premature deaths every year and more than $100 billion in annual health costs.”