June 05, 2012 Articles

The Rise of Fracking and Associated Litigation

Production companies hoping to avoid lengthy and costly discovery proceedings must understand plaintiffs' pleading requirements to survive motions to dismiss.

By James Eimers and Liz Klingensmith – June 5, 2012

Although the technology has been in existence commercially for more than 60 years, hydraulic fracturing—or “fracking”—has only recently taken center stage in the increased production of natural gas in fields around the United States. Paired with horizontal drilling, fracking has allowed production companies to extract large quantities of previously unrecoverable gas in tight shale and coal bed formations. The process itself consists of pumping a mixture of fluid and propping agents—such as sand or ceramic pellets—into a well at high pressures sufficient to expand existing or create new cracks in the formation. The granular proppants subsequently hold these cracks open and permit the additional flow and production of gas. With the widely increased implementation of fracking over the last decade, natural gas reserves have grown to record highs, while natural gas prices have fallen concomitantly.

Despite the fact that fracking has exponentially increased the production potential of natural gas within U.S. borders, the process is not without vocal opponents. In addition to certain legislators and environmental groups, individuals leasing property to oil and gas companies have alleged that fracking can cause serious health, environmental, and property harms. Indeed, as fracking operations have become more prevalent, landowners in various federal districts have begun to file lawsuits against company leaseholders. Although not factually identical, these suits typically allege that fracking and other general drilling operations have contaminated groundwater and soil, and polluted the air and atmosphere.

As the specter of litigation grows with the expansion of fracking operations, production companies hoping to avoid lengthy and costly discovery proceedings must understand plaintiffs’ pleading requirements to survive motions to dismiss. The relevant standard for such motions is Federal Rule of Civil Procedure 12(b)(6), which permits dismissal of complaints for failure to state a claim upon which relief can be granted. The universe of cases arising from alleged fracking contamination remains nascent. However, a survey of several recent federal cases—three of which survived dismissal motions with no repleading necessary, one of which did not—potentially clarifies the level of specificity to which plaintiffs’ allegations must rise if their complaints are to survive 12(b)(6) motions and continue to discovery.

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