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Mineral royalty owner sues Denton

Profile image for By Peggy Heinkel-Wolfe / Staff Writer
By Peggy Heinkel-Wolfe / Staff Writer

Man claims damages in excess of $1 million

A Denton-area lawyer has sued the city over mineral takings, claiming that the city’s many moratoriums on new permits have effectively served as a ban on natural gas drilling.

Charles Chandler Davis sued on behalf of his company, Arsenal Minerals and Royalty, as well as NASA Energy Corp. and his son’s trust fund, claiming damages in excess of $1 million. He claims the city violated both the state and U.S. constitutions, specifically the rights of due process, with both the moratoriums and its ordinance revisions.

In the pleadings, Davis also claims that the city’s upcoming frack-ban proposition on the Nov. 4 ballot violates the Texas Election Code, calling it a “governmental fiat.” Denton voters are being asked whether to ban the technique of hydraulic fracturing in the city limits. The proposition does not ban drilling itself.

Before filing their lawsuit, court documents show Davis’ family members filed an open records request, asking the city for a copy of its “takings impact assessment.” Davis said the city should have made such an assessment and determined the value of the 487 wells in its corporate and extraterritorial limits before adopting the moratoriums.

Neither Davis nor the city of Denton would say whether such an assessment was ever made. Davis said he told the Texas attorney general’s office, which governs such assessments, about his attempts to get the information. There are penalties for failing to perform the assessment, he said.

“It’s a pretty draconian feature of the law,” Davis said.

Many cities in the Barnett Shale region have adopted moratoriums and extended them while updating their ordinances. Davis said he would be surprised to learn, if it were true, that no one ever requested an assessment in the past.

City Attorney Anita Burgess declined to comment specifically on whether the city had made such an assessment, saying she wasn’t at liberty to say much about the lawsuit right now.

“We are reviewing the allegations in the lawsuit and will vigorously defend the city’s actions,” Burgess said.

Davis said he is not the only Denton royalty owner affected by the moratorium on new drilling permits, but he said he has no intention of turning his lawsuit into a class action.

“I’m not an expert on class action,” Davis said, adding that class action lawsuits aren’t favored in Texas courts. “I’m not in any way working with any organization or group.”

Environmental attorney Jim Bradbury called mineral takings claims a “lingering ghost” between surface owners and mineral owners over drilling disputes. However, he hasn’t seen mineral owners and their attorneys really going after such claims against surface owners who may not want to drill on their property.

“It’s one thing to say it’s a taking,” Bradbury said. “It’s a whole different thing to prove it.”

Davis is a former Denton district court judge who has been disciplined more than once by the State Bar of Texas, according to documents obtained from the state agency. Most recently, he was barred from practicing law from 1999 to 2005 after he pleaded guilty to two counts of indecency with a child, according to documents.

PEGGY HEINKEL-WOLFE can be reached at 940-566-6881 and via Twitter at @phwolfeDRC.