1 AliKANsAs LESLIE WAYNE SCOGGIN, B. SCOGGIN and H. SCOGGIN, minors, by and through TINA SCOGGIN; TINA SCOGGIN, individually and KEVIN SCOGGIN, individually, Plaintiffs, vs. SOUTHWESTERN ENERGY COMPANY, Defendant. DEC 0 7 2012 , By:_:JORMACK, CLERK Case No. L\ .\J. w Lw3 JJ\>\Y\ This case assigned to District Judge and to Magistrate CLASS ACTION COMPLAINT COME NOW the Plaintiffs, for themselves and on behalf of all similarly situated persons, and for cause of action against the Defendants, state as follows: INTRODUCTION This class action lawsuit is filed on behalf of the named Plaintiffs, Leslie Wayne Scoggin; Tina and Kevin Scoggin, individually, and B. Scoggin and H. Scoggin, minors through Tina Scoggin, and all those citizens and/or residents and/or property owners who live and/or own property within a 500 foot radius of any Drilling/ Hydraulic Fracturing operation being operated by the Defendant 1 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 1 of 24 within the State of Arkansas. This action is being brought against the Defendant for the creation of a noxious and harmful nuisance; contamination; physical harm; trespass, property damage and diminution of property values that the drilling and fracking operations have caused and continue to cause. This action seeks, among other relief, injunctive relief as follows: A. Require medical monitoring of all persons within the aforementioned geographical parameters to insure no health problems arise due to ongoing exposure to the Defendants' activities. JURISDICTION AND VENUE 1. Plaintiffs, Leslie Wayne Scoggin; Tina and Kevin Scoggin and B. Scoggin and H. Scoggin, minors, are resident citizens of White County, Arkansas, residing at 708 Scoggin Road, Bradford, White County, Arkansas. 2. Defendant, Southwestern Energy Company, is a Delaware corporation with its principal place of business in Houston, Texas. Southwestern Energy Company, directly and through its agents and/or ostensible agents, was and continues to be engaged in the creation and operation of drilling and fracking operations in and about the State of Arkansas. The Defendant is responsible, either directly or through its agents and/or apparent agents, for the creation and 2 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 2 of 24 operation of drilling and [racking sites located in the vicinity of Plaintiffs' properties. Defendant, Southwestern Energy Company, has done, and continues to do, business in the State of Arkansas, and has committed a tort, in whole or in part, in the State of Arkansas, and likewise has sufficient minimum contacts with Arkansas. Southwestern Energy Company c/o The Corporation Company 124 West Capitol Ave., Suite 1900 Little Rock, AR 72201 3. Plaintiffs' causes of action arise in the State of Arkansas as a direct result of the tortious conduct of the Defendant and continuing tortious conduct of the Defendant. 4. The Court has jurisdiction over this action under 28 U.S.C. 13 3 2( a)( 1) because the Plaintiffs, and the Defendants, are citizens of different states and the amount in controversy exceeds $75,000.00, excluding interest and costs. 5. The actions complained of herein occurred in the Eastern District of Arkansas and venue is proper in this Court. 6. Plaintiffs specifically allege that valid service of process has been issued and will be properly served upon the Defendant herein. 3 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 3 of 24 7. Plaintiffs specifically allege that there is no individual or legal entity who is not a party to this action, who caused or contributed to the injuries and damages for which the Plaintiffs seek recovery herein. 8. The Defendant is being sued individually, and under the Doctrine of Respondeat Superior, for the actions and/or inactions of the Defendant, Southwestern Energy, its agents, apparent agents, servants, employees and subsidiary corporate entities. FACTS 9. The Defendant herein conducts gas drilling in an area known as the Fayetteville Shale, which is located in central Arkansas and covers nearly four thousand square miles of land. The term "Fayetteville Shale" refers to both a geographical location, (Central Arkansas) as well as a specific rock formation made up of shale rock. The rock formation comprising the Fayetteville Shale ranges in depth from one thousand feet below the surface to as deep as seven thousand feet below the surface of the earth. 10. Natural gas drilling involves drilling a well bore down to a selected rock formation, turning the drill in a horizontal direction and drilling outward from the vertical bore. Thereafter, a series of explosions are set off along the wellbore. Once the bore is perforated by the explosive charges, the well bore is 4 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 4 of 24 then hydraulically fractured using high pressure injection of fracturing fluid and other materials into the rock formation to create fracture lines and fissures which then allow gas to flow from the fractures to the wellbore. That process is referred to as "fracking." Illustration of a wellbore is as follows: Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 5 of 24 11. The fracking process uses a mixture of water, and sand, and numerous caustic, poisonous, flammable, carcinogenic and harmful compounds to fracture the shale rock formation and release the methane and hydrogen sulfide gases within the shale. The compounds used in formulating the fracking fluid can include diesel fuel, formaldehyde, toluene, hydrochloric acid, methanol, ammonium persulfate and sodium tetraborate pentahydrate in varying concentrations. In addition to the fracking fluid, the process also requires the injection of"proppants" into the fractures to prop open the pathways for the gases to exit the shale formation and enter the well bore. 12. The process of drilling and fracking a shale gas well causes migration of noxious gases, fumes, exhaust, silica dust and other harmful substances from the actual drilling pad onto the air, lands and properties which surround the drilling pad. 13. Such migration occurs when the gases, atomized fluids, silica dust and other noxious materials become airborne and are then carried by the wind and fan out in an ever widening area. 14. Video Captures taken at the Plaintiffs' residence demonstrates the extent of the airborne pollutants at the frack site in question. Illustrations below. 6 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 6 of 24 7 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 7 of 24 15. The process of drilling and fracking a shale gas well also causes extreme levels of noise and vibrations which in tum causes damage to surrounding structures, including but not limited to buildings, homes, foundations, and well and cistern enclosures. 16. The process of drilling and fracking a shale well also involves hundreds and hundreds of trucks traveling to and from the fracking site, 24 hours a days, 7 days a week for months at a time. In addition these same trucks gather and "muster" in the vicinity of the site, sitting with their engines idling and emitting large quantities of toxic and carcinogenic exhaust fumes. 1 7. In short, a rural, pastoral landscape is turned into an industrial development overnight, with all its attendant problems and hazzards when the Defendant elects to drill and frack a shale gas well. 18. All of the aforementioned problems are amplified when the Defendant elects to drill in the immediate vicinity of a residence. 19. In addition to the migration of noxious and toxic fumes and particles in the air surrounding the fracking site, the process of hydraulic fracturing and gas gathering causes the fracking fluids as well as proppants and others substances to migrate and travel along the fractures, fissures and fault lines which are created during the fracturing process. In addition, those man-made fractures and fissures 8 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 8 of 24 intersect and join with the natural fractures, fissures and faults which already exist in the rock formation. As a result, there is migration of the fracking fluid as well as methane and hydrogen sulfide all along these fracture lines. It is this migration which results in the contamination of soil, groundwater, lakes, ponds, reservoirs, springs, creeks, drinking water wells on the properties located in the vicinity of shale gas wells. 20 According to Lawrence Bengal, the Head of the Arkansas Oil and Gas Commission, (AOGC) gas and fluids can migrate from the fractured shale, up through numerous layers and strata to the point where it can contaminate water wells at a depth of less than 200 feet. 21. Mr. Bengal has testified under oath that such migration of both gas and/or fluid occurs when gas or fluid travels up the well bore between the metal pipe placed in the wellbore, and the surrounding rock. To attempt to prevent such migration, a cement casing is installed to fill the gap between the pipe and the rock formation. That cement casing however can allow migration up the wellbore, even in instances where there is an apparently good cement job. " A The fluid migration? MR. PERKINS: Object to the form. Q Fluid or gas. A It can happen on any cement job, yes.n (Deposition of 9 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 9 of 24 Lawrence Bengal at Page 135) 22. That migration has been found to occur in the Fayetteville Shale, most recently in the area of Guy/Quitman Arkansas where gas migrated up through various formations until it reached a domestic drinking water well where it began to spew out, causing evacuations of nearby residents. 23. According to AOGC's Bengal, there is no way to predict when that migration will occur. It can happen shortly after the well is drilled and fracked, or any number of years later as the gas and fluids continues to make its way up the well bore and into the various rock formations through which the well bore passes. 24. The Plaintiffs reside on a 20 acre parcel of land located in Bradford, Arkansas. This land has been in the Scoggin family for over 100 years. B. Scoggin is five years old and H Scoggin three years old. 25. In October of 2010, Defendant began the process of constructing a drilling pad/platform for the eventual erection of a drilling rig directly across from Plaintiffs' property, less than 350 feet from the home itself. The specific pad location was along the property line on land owned by one of the Scoggin's neighbors. 10 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 10 of 24 26. To construct the drilling pad/platform, Defendant brought in numerous pieces of heavy earth moving equipment to prepare the site for the eventual drilling platform. The Defendant's activities were carried out continuously, (day and night), generating large amounts of construction dust and debris, and loud noise on a constant basis which severely interfered with Plaintiffs' quiet enjoyment of their home and property. 27. Thereafter, the Defendant and its agents and apparent agents and subsidiary companies and entities began drilling three separate well bores on the drill pad located less than 350 feet from Plaintiffs' residence. Thereafter, the Defendant and its agents and apparent agents and subsidiary companies and entities fracked the three wells, again at a distance of less than 350 feet from Plaintiffs' home. 28. The drilling and fracking operations lasted for almost six months, during which time the Scoggin's home became uninhabitable because of the noise, vibration, light and air pollution which was caused by the Defendant's operations being carried out less than 350 feet from Plaintiffs' residence. 29. In addition, the construction of the well pad significantly altered the flow of run-off water from the adjacent property in such a way as to cause the run-off to flow and accumulate in Plaintiffs' hay pasture, ruining Plaintiffs' crop 11 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 11 of 24 of hay and rendering that pasture unusable for either growing hay or grazing livestock. 30. The Plaintiffs were continually subjected to extremely loud noise, vibration and air and light pollution from the Defendant's operations which was not only harmful, but was also extremely upsetting and frightening. 31. The Defendant's drilling and fracking operations caused severe, harmful, carcinogenic and toxic pollution of the air in and around Plaintiffs' home with diesel exhaust fumes, atomized fracking fluid and silica dust. In home air measurements showed toxic levels of benzene and other pollutants which emanated from the Defendant's operations less than 350 feet from the Plaintiffs' home. Air quality measurements taken inside the Scoggin home during the drilling/fracking operations showed extreme levels of carcinogenic and toxic airborne substances which emanated from the drilling/fracking. 32. The Defendant's operations have caused the cistern on Plaintiffs' property to cease operating properly. The natural water flow which fed the cistern has been significantly altered and the water which is available is contaminated and unsuitable for drinking. 33. The Defendant's activities, carried out directly and through Defendant's agents and apparent agents and subsidiary companies and entities 12 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 12 of 24 caused the following harm and damage to your Plaintiffs and others similarly situated: a. Pollution and/or contamination of the soil with harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; b. Pollution and/or contamination of the groundwater with harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; c. Pollution and/or contamination of the cistern with harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; d. Pollution and/or contamination of the air and atmosphere with harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; e. Structural damage to Plaintiffs' residence and cistern CAUSES OF ACTION STRICT LIABILITY 34. The Plaintiffs repeat and reallege the allegations of paragraphs "1" through "33" ofthis Complaint, as if set forth in this paragraph at length. 13 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 13 of 24 35. The harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds resulting from the Defendant's drilling and fracking operations, are of a toxic and hazardous nature capable of causing severe personal injuries and damages to persons and property, and are therefore ultra hazardous and abnormally dangerous. 36. The harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds resulting from the Defendant's drilling and fracking operations, are of a toxic and hazardous nature capable of causing severe personal injuries and damages to persons and property, regardless of the degree of caution exercised by the Defendants. 37. The Defendant's activities created an unacceptable risk of harm to the Plaintiffs and their property, along with all other persons and property similarly situated. 38. The Defendant, by engaging in abnormally dangerous and ultra hazardous activities, are strictly liable without regard to fault for all the damages and injuries to the Plaintiffs proximately caused by their drilling and fracking operations. 14 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 14 of 24 NUISANCE 39. The Defendant's drilling and fracking operations unreasonably interfered, and continues to interfere, with the safe use and enjoyment of adjoining and nearby lands and thus disturbs the peaceful, quiet and undisturbed use and enjoyment of such property. TRESPASS 40. The Defendant's drilling and fracking operations have trespassed on the land of the Plaintiffs, and all others similarly situated, through the migration and accumulation of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds upon and under the land and the air. 42. The Defendant's trespasses have resulted in physical damage to the property of the Plaintiffs, and all others similarly situated, thereby causing injury to the right of possession of such property. NEGLIGENCE 43. The Defendant owed a duty of care to the Plaintiffs to responsibly engage in gas production activities in and around the Plaintiffs' home. 44. The Defendant had a duty to take all measures reasonably necessary to inform and protect the Plaintiffs from the dangers which accompanied 15 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 15 of 24 the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds due to the operations of the Defendant. 45. The Defendant, including its agents, apparent agents, servants and/or employees, knew or in the exercise of reasonable care should have known, that their operations were resulting in a migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds. 46. The Defendant directly, and through Defendant's agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees, knew or in the exercise of reasonable care should have known, that the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds exposed the Plaintiffs and their property to a risk of pollution and/or contamination of their property. 47. The Defendant directly, and through Defendant's agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees should have taken reasonable precautions and measures to prevent or mitigate migration of harmful and/or hazardous and/or 16 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 16 of 24 caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds , including adequate planning. 48. The Defendant directly, and through Defendant's agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees knew or in the exercise of reasonable care should have known, that once a migration occurred, the Plaintiffs would be harmed. 49. The Defendant directly, and through Defendant's agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees, knew or in the exercise of reasonable care should have known, that the harm caused to the Plaintiffs and their property was a foreseeable and inevitable consequence of the migration ofharmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds due to the Defendant's operations. 50. The Defendant directly, and through Defendant's agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees, acted unreasonably and negligently in causing the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds, and failed to take 17 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 17 of 24 reasonable measures and precautions necessary to avoid the damage that was sustained by the Plaintiffs and their property. 51. The Defendant's acts and/or omissions mentioned herein were the direct and proximate cause of the damages sustained by the Plaintiffs and their property. 52. Some or all of the acts and/or omissions of the Defendant directly and through its agents, servants, employees, apparent agents and subsidary companies and entities, were grossly, recklessly and wantonly negligent, and were done with utter disregard for the consequences to the Plaintiffs, and therefore the Plaintiffs are entitled to an award of punitive damages. 53. The Plaintiffs in no way caused or contributed to the damages they have sustained. CLASS ACTION 54. The Plaintiffs repeat and reallege the allegations of paragraphs "1" through "53" of this Complaint, as if set forth in this paragraph at length. 55. The Plaintiffs bring this action for themselves and on behalf of a class of other similarly situated persons consisting of the following: all those citizens and/or residents and/or property owners who live and/or own property within a 500 foot radius of any drilling and fracking operation by the Defendant 18 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 18 of 24 Southwestern Energy, and its agents and apparent agents and subsidiary companies and entities including their agents, apparent agents, servants and/or employees. 56. The Plaintiffs are members of the class that they seek to represent. 57. The class is so numerous that joinder of all members is impracticable. 58. There are questions oflaw and fact which are common to the class, including but not limited to: a. Whether the Defendant's activities caused a migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; b. Whether the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds caused pollution or contamination of the soil of the class members; c. Whether the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds caused pollution or contamination of the air and property of the class members; d. Whether the migration of harmful and/or hazardous and/or 19 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 19 of 24 caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds caused pollution or contamination of the water wells of the class members; e. Whether the Defendant's activities constitute a nuisance; f. Whether the Defendant's are strictly liable for their actions and/or inactions; g. Whether the Defendant's activities were negligently performed; h Whether the Defendant's activities caused a trespass upon the land of the class members; 1. Whether the Defendant's activities exposed the Plaintiffs and others similarly situated to harmful levels of pollutants which potentiate future medical problems for the Plaintiffs and others similarly situated. 59. The claims of the representative parties are typical of the class members because the action arises from the same common wrongs against the members of the class. 60. The Defendant has acted on grounds generally applicable to the class making appropriate injunctive relief with respect to the class as a whole. The injunctive action sought as described previously, is necessary because of the severe 20 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 20 of 24 and irreparable harm which the migration of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals creates upon the property of the Plaintiffs and all other class members. 61. Questions of law and fact common to the members of the class predominate over any questions affecting only individual members because preliminary, overarching issues common to all class members predominate over the individual issues. 62. A class action is superior to other available methods for the fair and efficient adjudication of the controversy because class certification is a more efficient way to handle the case, the class is manageable and class certification will avoid a multiplicity of individual actions. 63. The Plaintiffs will fairly and adequately represent and protect the interests of the class. INJURIES AND DAMAGES 64. The Plaintiffs repeat and reallege the allegations of paragraphs "1" through "63" of this Complaint, as if set forth in this paragraph at length. 65. As a direct and proximate result of the unlawful activities of the Defendant, the Plaintiffs, and all others similarly situated, have suffered the following losses and damages: 21 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 21 of 24 a. Loss of use and enjoyment of their property; b. Contamination of their soil; c. Contamination of their groundwater; d. Contamination of their well water; e. Contamination of their air and atmosphere; f. Severe diminution in value of their property; g. Fear, shock, mental distress and physical harm h. Physical injuries resulting from breathing silica dust and other harmful chemicals which emanated from the defendant's activities and which contaminated Plaintiffs lungs with dust particles. 1. Medical and physical complications resulting from the exposure to Defendant's airborne industrial pollution at the drilling site. J. Trespass upon the properties of the class members RELIEF SOUGHT WHEREFORE, PREMISES CONSIDERED, the Plaintiffs sue the Defendant herein, jointly and severally as follows: A. Compensatory damages for the injuries enumerated above in the amount of $10,000,000.00 (TEN Million Dollars). 22 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 22 of 24 B. Punitive Damages in the amount of$15,000,000.00 (FIFTEEN Million Dollars). Plaintiffs further pray for: a. Certification of a class as requested; b. Judgments for compensatory damages for all class members in an amount commensurate with the damages as set forth above; c. Judgments for punitive damages for all class members in an amount commensurate with the damages as set forth above; d. Installation of municipal or city water for all class members. e. In the alternative to Paragraph d, above, that the Defendants be required to establish a monitoring system to regularly test all domestic water wells of the class members. f. Establishment of a monitoring fund to pay for monitoring of air, soil, groundwater, and atmosphere for the presence of harmful /or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; g. Establishment of a monitoring fund to pay for medical monitoring of the named Plaintiffs and class members similarly 23 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 23 of 24 situated, for the presence or emergence of health effects stemming from the Defendant's generation and/or use of harmful and/or hazardous and/or caustic and/or carcinogenic and/or poisonous and/or flammable chemicals and compounds; h. An award of the costs of litigating the case; 1. An award of attorney fees; J. An award of pre-judgment interest; k. All other relief to which the Plaintiffs may be entitled. PLAINTIFFS RESPECTFULLY REQUEST A TRIAL BY JURY. DEAL, COOPER & HOLTON, PLLC. Timothy It. Holton (2001 101) John R. Holton (2009056) 296 Washington Ave. Memphis, TN 3 8103 (901)523-2222 and Michael P. McGartland MCGARTLAND AND BORCHARDT 1300 South University Drive Fort Worth, Texas (817)332-9300 24 Case 4:12-cv-00763-DPM Document 1 Filed 12/07/12 Page 24 of 24