Mitchell v. MIDSTATES OIL CORPORATION, Civ. A. No. 4068.

• Decision Date: 12 June 1957
• Docket Number: Civ. A. No. 4068.
• Citation: 151 F. Supp. 804
• Parties: James P. MITCHELL, Secretary of Labor, United States Department of Labor, Plaintiff, v. MIDSTATES OIL CORPORATION, Defendant.
• Court: U.S. District Court — Northern District of Oklahoma

151 F. Supp. 804

James P. MITCHELL, Secretary of Labor, United States Department of Labor, Plaintiff, v. MIDSTATES OIL CORPORATION, Defendant.

Civ. A. No. 4068.

United States District Court N. D. Oklahoma.

June 12, 1957.

Stuart Rothman, Sol. of Labor, Washington, D. C., Earl Street, Regional Atty., and Harry Campbell, Jr., Dept. of Labor, Dallas, Tex., for plaintiff.

Charles Barnes, Jr., and Hulette F. Aby, Tulsa, Okl., for defendant.

SAVAGE, Chief Judge.

Statement of the Case

This is an action to enjoin the defendant from violating the provisions of Section 15(a) (1), 15(a) (2) and 15 (a)(5) of the Fair Labor Standards Act, 29 U.S.C.A. § 201 et seq. The issue is whether certain of defendant's employees who are classified as and perform the duties of "scouts" are employed in a bona fide administrative capacity within the meaning of Section 13(a) (1) of the Act and the applicable regulations issued by the Administrator. To resolve the issue it is necessary only for the Court to determine whether said employees customarily and regularly exercise discretion and independent judgment in the performance of their duties. The plaintiff concedes that said employees satisfy the other requirements of the Administrator's definition of an "administrative employee". Likewise, the credibility of the witnesses is conceded by plaintiff.

The cause was tried and the Court, having considered the evidence, finds the facts and states the conclusions of law as follows:

Findings of Fact

1. The primary function of defendant's scouts is to gather, evaluate and report information about the activities of competing operators. The scouts seek knowledge of leasing activities, geophysical and geological surveys, drilling activities and general oil and gas operations. In some cases, such information is freely exchanged among operators. In others (such as the drilling of a "tight" well, hereinafter mentioned, or a geophysical survey) secrecy is sought and the scouts must learn what they can without any aid from the rival operator.

2. In the course of the performance of their work the scouts assemble, evaluate and verify information pertaining to the following matters, among others:

(a) The location of new drilling wells; formations encountered and the depths thereof; results of testing and coring and samples of cores; drilling times; mud weights; hydrostatic pressures and numerous other data of geological and engineering significance to the defendant. The scout must have special training or experience to perform this work and the other functions mentioned below.

(b) The following and reporting of oil and gas leasing activities to learn the name of the rival operator making such purchases, the price being paid for same and, of more importance, the reason why such leases are being purchased. In connection with this work, the scout conducts an investigation to ascertain what lands may be unleased in the area in order that the defendant might have the first opportunity to purchase the same.

(c) Obtaining geologic and engineering data on "tight" wells, including the objective depth of the well, perforation record, whether an electric log has been run, and the details of operations performed on the well. This assignment is, ordinarily, a difficult one and to obtain the needed information requires a considerable amount of ingenuity, experience and detective ability.

(d) The following and reporting of the activities of geophysical exploration crews, which includes the mapping of shot points and the interrogation of landowners and crew members in an effort to obtain any and all data which might be of value to the defendant in determining whether the crew has found a...