Frey v. Amoco Production Co.
| Citation | 951 F.2d 67 |
| Decision Date | 08 January 1992 |
| Docket Number | No. 90-3553,90-3553 |
| Parties | Frederick J. FREY, et al., Plaintiffs-Appellants, v. AMOCO PRODUCTION COMPANY, Defendant-Appellee. |
| Court | United States Courts of Appeals. United States Court of Appeals (5th Circuit) |
David M. Ellison, Jr., Ellison & Smith, Frederick W. Ellis, Thomas C. McKowen, IV, Strain, Dennis, Ellis, Mayhall & Bates, Baton Rouge, La., for plaintiffs-appellants.
Frank J. Peragine, Christina H. Belew, Simon, Peragine, Smith & Redfearn, New Orleans, La., for defendant-appellee.
Appeal from the United States District Court for the Eastern District of Louisiana.
ON PETITION FOR REHEARING
(Opinion October 7, 1991, 5th Cir., 943 F.2d 578)
Before REAVLEY, KING and JONES, Circuit Judges.
In Frey v. Amoco Production Co., 943 F.2d 578 (5th Cir.1991) we decided, inter alia, that when a Louisiana mineral lease provides the lessor "royalty on gas sold by the Lessee of one-fifth ( 1/5) of the amount realized at the well from such sales," take-or-pay payments, received by the lessee from a pipeline-purchaser for gas not taken, are subject to the lessor's royalty. Id. at 580-86. Our decision states the meaning of this suit's royalty clause as a matter of Louisiana law. While we continue to believe in the propriety of our rationale and its consequence, Amoco convinces us in its Petition for Rehearing that the precise meaning of the royalty clause at issue in this suit carries tremendous consequences for Louisiana's gas industry and its citizens who own mineral interests in Louisiana real estate. We agree with Amoco that Louisiana's Supreme Court is the appropriate authority to decide whether the royalty clause at issue in this case requires Amoco to share take-or-pay payments with Frey, its lessor. So we exercise the certification privilege granted by Rule XII of the Rules of the Supreme Court of Louisiana.
I. STYLE OF THE CASE
The style of the case that we certify is Frederick J. Frey, et al., Plaintiffs-Appellants, versus Amoco Production Company, Defendant-Appellee, Case No. 90-3553, United States Court of Appeals for the Fifth Circuit, on appeal from the United States District Court for the Eastern District of Louisiana.
II. STATEMENT OF FACTS
Our opinion at 943 F.2d 578 (5th Cir.1991) recites this case's facts, but that opinion contains one minor error. Our opinion incorrectly describes the Settlement Agreement's treatment of the $45.6 million in recoupable take-or-pay payments that Amoco received from Columbia. See id. at 583. The Settlement Agreement permitted Columbia to recoup the entire $45.6 million payment by purchasing more gas than required under the amended Morganza Contract within any of five recoupment years. Amoco has...
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