Oklahoma Case Could Open Doors to More Earthquake-Fracking Lawsuits

State Supreme Court's to decision to allow Sandra Ladra to sue energy companies over quakes could encourage others to step forward with liability cases.

The Oklahoma State Supreme Court has ruled that Sandra Ladra can proceed with her case to sue multiple oil and gas companies over injuries she suffered when a major earthquake struck her home. Credit: Drilling rig near Elk City in Western Oklahoma/Travel Aficionado, flickr

Nearly four years after Prague, Okla., became the unlikely epicenter of three earthquakes of at least magnitude 5.0 and sent a fireplace and chimney tumbling into Sandra Ladra's living room, the Oklahoma Supreme Court has stepped in and offered her a surprising ray of hope.

Ladra, 65, suffered a severe leg injury from the falling fireplace. And in 2014 she sued multiple oil and gas companies, based on recent research that has tied Oklahoma's suddenly commonplace earthquakes to the fracking boom. It seemed like a long shot until this week, when the state's highest court said her case could proceed.

"If she wins, it will have implications in all states," said Bruce Baizel, energy program director at Earthworks, a national environmental group.

It took about two years after the quakes that injured Ladra for scientists to draw a strong link between the state's seismic activity and the disposal wells from oil and gas drilling. By then, Oklahoma's thousands of small earthquakes had gotten national attention. Last year, it surpassed California as the most seismically active of the 48 contiguous states. In recent years, the state's oil production nearly doubled and natural gas production increased significantly.

Until recently, state officials were reluctant to acknowledge any link between the quakes and the drilling boom. And the primary defendants in this suit, New Dominion LLC and Spess Oil, had been arguing that the case should fall under the jurisdiction of the state's oil and gas regulators at the Oklahoma Corporation Commission, not the courts. Last October, a district court ruled for the defendants. The Supreme Court, in a unanimous verdict, overturned that decision.

Now, for the first time in Oklahoma's history, Ladra and her legal team, will try to prove before the disctrict court that a specific earthquake was man-made, and that the activities of certain oil and gas companies were to blame.

A victory for Ladra would set a legal precedent in Oklahoma, and could become a case referenced by courts countrywide and potentially encourage more people to take up the fight.

This case just adds to the "mounting movement" of people in energy states "seeking relief for earthquake damages," said Blake Watson, a University of Dayton law professor who has been tracking the issue.

Watson said there's a similar pending case in Texas, in which two couples are claiming that a series of small earthquakes that struck Johnson County in 2012 caused significant damage to their homes. They've said the following energy companies are responsible: EOG Resources Inc., Shell Trading Company, Sunoco Partners Marketing and Enterprise Crude Oil LCC.

In Arkansas, too, there have been at least 12 similar cases filed since 2011. Most, if not all, have since been dismissed. It's unclear whether any of those plaintiffs settled outside of court. If so, they were likely subject to confidentiality clauses. Like Oklahoma, both states have seen increases in wastewater disposal activity––and earthquakes.

Earthquakes are generally triggered when faults move due to a buildup of pressure in the surround rock. By injecting millions of gallons of water deep underground in areas around faults, it can increase the pressure enough to set the ground shaking.

A recent scientific study found that the increase in the number of earthquakes in Oklahoma, Texas and the entire U.S. midsection is associated with injection wells, and that wells blasting the most wastewater into the ground, and at a faster rate—more than 300,000 barrels a month—were more likely to be linked to the quakes. Oklahoma has hundreds of wells used to dispose of energy-related wastewater spread across the state.

Scott Poynter, Ladra's laywer, told InsideClimate News that the "merits of the lawsuit are very, very good."

Still, Poynter acknowledged that it won't be an easy case to win, because the energy industry has so much at stake.

"This issue is something that not only the defendants in the case, New Dominion and Spess Oil, are concerned about—but the entire industry is concerned about this case," he told InsideClimate News.

Spess Oil Company declined to comment and New Dominion didn't respond to multiple calls for comment. The industry has long argued there is not connection between earthquakes and oil and gas drilling activity.

"There has been a general inability to connect any specific earthquakes to any specific oil and gas operations. As a result, we anticipate that the plaintiffs in any cases of this kind will face a significant obstacle," The Oklahoma Oil and Gas Association said in a press release on the recent decision.

Since Ladra filed her case, another Oklahoma lawsuit targeting the same energy companies for the 2011 events has also been filed. Poynter is also representing the plaintiffs in that case, and the recent high court decision ensures that they too will likely get their day in the courthouse.

Poynter was very pleased with the outcome. He said if the court finds the energy companies liable, it has more authority to provide what's called "remedy" to the plaintiff. For example, it could authorize the companies to pay compensation to Ladra.

Poynter said the energy companies wanted the case to play out under the authority of the Oklahoma Corporate Commission because the commission is limited to penalizing the energy companies by rescinding their permits or fining them, and because the commission generally favors the energy industry.

All three commissioners are Republicans and were elected to office. The commission has stepped up its oversight of injection wells potentially linked to quakes in the last year, but expected budget cuts could hinder future response efforts.

Warmington, from the Oklahoma Oil and Gas Association, said in a prepared statement: "We feel that the argument made by the defendants in the Ladra case regarding the jurisdiction of the Corporation Commission had merit, but we respect the Court's ruling to the contrary."

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