Opposition Brief — Ewell v. Thompson

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NUMBER:

t _——

Supreme Court, U.S.

- FILED

i} SAN 30 1989

JOSEPH F. SPANIOL,

JR.

CLERK

88-965

IN THE UNITED STATES SUPREME COURT

OCTOBER TERM, 1988

LEIGHTON EWELL, ROSA McMILLAN,

BETTY CRAIG AND DOLESE CONCRETE COMPANY

PETITIONERS

HONORABLE HERBERT W. THOMPSON,

COMMISSIONER OF CONSERVATION AND

ASSISTANT SECRETARY, OFFICE OF CONSERVATION

OF THE STATE OF LOUISIANA, ET AL.,

RESPONDENTS

ON PETITION FOR A WRIT OF CERTIORARI

TO THE SUPREME COURT OF LOUISIANA

BRIEF IN OPPOSITION

Randall C. Songy*

R. Thomas Jorden, Jr.

ONEBANE, DONOHOE,

BERNARD, TORIAN,

DIAZ, MCNAMARA & ABELL

P. 0. Box 3507

Lafayette, Louisiana 70502

(318) 237-2660

Attomeys for Respondents

Celeron Oil and Gas Company,

First Energy Corporation,

Union Texas Petroleum,

TXO Production Corporation,

William J. Guste, Jr.

Attomey General

Gary L. Keyser

Assistant Attorney General

Mary Ellen Leeper

Assistant Attomey General

P.O. Box 2827

Baton Rouge, Louisiana 70821

(504) 342-4604

Attomeys for Respondent

Commissioner of Conservation

Borden, Inc., and Terra Resources, Inc. *Counsel of record

1.

QUESTIONS PRESENTED

Whether the United States Supreme Court has jurisdiction to

review a decision of the Louisiana Supreme Court at the instance

of petitioners who have suffered no injury in fact, where no

personal benefit or practical relief would result from the remedy

sought and where there is an adequate and independent state

ground for the action of the court?

Whether, considering the effect of Order 1047-B of the

Louisiana Commissioner of Conservation on these petitioners,

the important state interests involved, and the impracticality of

requiring a more extensive search, due process required more

than the extensive effort that the record reveals was undertaken

in this case to provide notice of the hearing? ;

LIST OF PARTIES

The plaintiffs below in the consolidated cases were Kaiser

Aluminum Exploration Company, Park Lane Enterprises, Inc.,

Expec Resources, Ltd., Acme Brick Company, Tolmak, Inc.,

Kansas City Southern Railway Company, Chevron U.S.A.,

Louisiana National Bank, as Trustee for the Kirk E. Williams, Jr.

Inter Vivos Trust and Bernadette S. Williams Inter Vivos Trust,

David Ewell, and the petitioners herein, Leighton Ewell, Rosa

McMillan, Betty Craig, and Dolese Concrete Company.

The defendant below was the Honorable Herbert W. Thompson,

Commissioner of Conservation and Assistant Secretary, Office of

Conservation for the State of Louisiana, respondent herein.

Intervencrs below included respondents Celeron Oil and Gas

Company, First Energy Corporation, Union Texas Petroleum, Terra

Resources, Inc., Borden, Inc., and TXO Production Corporation.

Rolfe McCollister, Sr., T. N. Samuel, Goldie Kizer, Roland C.

Kizer, Marion Kizer Jackson, and Roland C. Kizer, Jr., also

intervened in the District Court.

The parent company of respondent First Energy Corporation is

First Mississippi Corporation. Its affiliates and subsidiaries (other

than wholly owned subsidiaries) are Ammonia Producers, FRM

Agricultural Sciences Partnership, FirstMiss Gold Inc., Maxadyne

Corporation/Industrial Insulation, Inc., Steel Casting Engineering,

Ltd., and Triad Chemical.

The parent company of respondent Borden Energy Resources,

Inc. is Borden, Inc. Its affiliates and subsidiaries (other than wholly

owned subsidiaries) are Broex, S. A., E.S.T.E., S.A., Gallina

Blanca, S.A., Preparados Alimenticios, S.A., TRL, S.A., Borden

li

International Packaging Ltd., Food and Snack Holdings (Singapore)

Pte. Ltd., Borden Foods Malaysia Sdn. Bhd., Borden Intemational

Phillipines, Inc., Compania Casco S.A.I.C. Borden Chemical (M.)

Sdn. Bhd., Compania Chiricana de Leche, S.A., Materiales

Moldeables, S.A. de C.V., Compania Quimica Borden Ecuatoriana,

S.A., Gun Ei Borden Intemational Resin Co. Ltd., Hitachi Borden

Chemical Products, Inc., Korea Borden Chusik Hoesa, Meiji

Borden, Inc., Monochem, Inc., Nutrinsa, S.A., and W. Klemme

GmbH and Co.K.G.

The entity bearing the responsibility of respondent Celeron Oil

and Gas Company for this litigation is Celeron Corporation, whose

parent is Goodyear. Its affiliates and subsidiaries (other than wholly

owned subsidiaries) are Celeron Trading & Transportation Company

and Celeron Pipeline Company.

The parent company of respondent Union Texas Petroleum

Corporation is Union Texas Petroleum Holdings, Inc. Its affiliates

and subsidiaries (other than wholly owned subsidiaries) are Union

Texas Exploration Corporation, Union Texas International

Corporation, and Unimar Company. :

The parent company of respondent TXO Production Corporation

is Texas Oil & Gas Corp. which is a wholly owned subsidiary of

USX Corporation. TXO Production Corporation has no affiliates or

subsidiaries (other than wholly owned subsidiaries).

The parent company of respondent Terra Resources. Inc. is

Pacific Enterprises Oil Company which is a subsidiary of Pacific

Enterprises Oil and Gas Company which is a subsidiary of Pacific

Enterprises. Terra Resources, Inc. has no affiliates or subsidiaries

(other than wholly owned subsidiaries).

ill

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TABLE OF CONTENTS

PAGE

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EPL IE EEA A PEO ay CERES AEE TT DY 1

NS OE Te, GO © cinccnsincenibatancdsce dep cbesdsnnnanianncdaancntes 2

Reasons Why The Petition Should Be Denied ..................... 10

1. This Court is Without Jurisdiction to Entertain this

PING, 7. cinctnannaensdckchnielacsiiioniedehinibaignbdeneianes 10

A. Petitioners Have No Standing to Invoke this

Re III i so dccdcnkaxadssndacasecsbinxadoaxes 10

i Re i i iiehencsincescitcnitcedanncssntsnnncnvnsess 13

C. No Substantial Federal Question; Adequate and

Independent State Grounds ..............:..c:cceceee 18

2. Neither the Decision below nor the Record Raises the

Question Presented in the Petition .................... 20

3. The Decision of the Louisiana Supreme Court Does Not

Conflict With Decisions of This Court ............... 24

SE GARNER PERCE RR AR SR OME OREN LOR AP ONT RNS Pun te: 28

APPENDIX

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PET i vsisictcvsnins sakccntesnnvsccseesavsnnetassasasaencent A4

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iV

TABLE OF AUTHORITIES

CASES PAGE

Ades 0. Reema, ZEO UB. Bos CAPES sacecsscvacccnsssccesansnscs 19

Buchanan v. State Civil Service Commission,

372 So.2d 1065 (La.App. Ist Cir. 1979) ....... 14, 18

California v. San Pablo and Tulare Railroad,

OF By ee a ED bade (ndouduwenesestacicciesaessnsenacicen 16

City of Davis v. Coleman, 521 F.2d 661

ee Gt, SOAP inns add dcavacdbansmeisabcausedinbbndenssaeaninas 12

City of Los Angeles v. Lyons, 461 U.S. 95 (1983)............... 17

County of L.A. v. Davis, 440 U.S. 625 (1979) 0... 14

Dison wv. Ewe, S50 CA: Fe CIP GED ia svasscseccrincanccitisninaac 24

Director, etc. v. Perini North River Associates,

ER Ua Bere CE och ck cits cladnadansanddahacnccksancasensans 10

Durley v. Mayo 351 U.S. 277 (1956) ou... eee eeeccecceeeeeeees 19

Eilts wv. ine, DEP Us Mr Ce bnithdsansadarscrccscansscncess 19

Hunter Co. v. McHugh, 320 U.S. 222 (1943) ........... 13, 14, 15

In the Matter of Delahoussaye, 402 So.2d 308

(La. App. Ist Cir. 1981), cert. denied, 413 So.2d 494

Gis SID shes snnoendcdasbecncsrueosesiaceetiecaseenae 14, 15

Kaiser Aluminum Exploration Company v. Thompson

512 So.2d 1197 (La. App. Ist Cir. 1987)

Lynch v. New York ex rel. Pierson, 293 U.S. 52 (1934) ........ 19

Mathews v. Eldridge, 424 U.S. 319 (1976) .................4. 24, 26

Mennonite Board of Missions v. Adams, 462 U.S. 791

CIS canes cackcseaanin neha amin esakihaatenbanenuginine 24

Michigan vy. Long, 463 U.S. 1032 (1983) ...... 2... cece eee 19

Mullane v. Central Hanover Bank & Trust Co.,

EP MA PE PE cacincsnanccakhacesvarurecsusausens 24, 25, 26

Murphy v. Hunt, 455 U.S. 478 (1982) . .........ccceceee eee eee en 17

Nat'l Conservative Political v. Federal Election,

COG Fe Be I, Cr FO cnncnccadevescassasctnsciete 13

Natural Resources Defense Counsel v. United States

Nuclear Regulatory Commission, 680 F.2d 810

COC. GR. FRED scucscusscencucsctesesveaseeammediareatas 16, 17

Nunez v. Wainoco Oil & Gas Co. 488 So.2d 955 ,

(La. 1986), cert. denied, 479 U.S. 925 (1986)............ 2,11

Phyie v. Daily, S34 Ue. Sa0 CR wtserscnctssetecemnncen 19

Save Our Cumberland Mountains, Inc. v. Clark,

723 F.00 2432 GK. Cy BR) tibieettesncnnne 16

South East Lake View Neighbors v. Dept. of Housing,

GBS FDR HUET CHA, CORED wectncdatvctsscccceckesscasyansee 12

Stembridge v. Georgia, 343 U.S. 541 (1952) Medes ana! 19

Tulsa Professional Collection Services, Inc. v. Pope,

US. » 1086 S.C. 1940 (1988) .............0..... 24

Union Texas, etc. v. Corporation Commission, etc., .

651 P.2d 652 (Okla. 1981), cert. denied ,

45d U.S. BaF CRED cca cnkckcdcacnccbeuscsavaccateusisusseesene 10

Warth v. Seldin, 422 U.S. 490 (1975) ............cccccecceceeeeees 10

Weinstein v. Bradford, 423 U.S. 147 (1975) .................c eee 17

Williams v. Kaiser, 323 U.S. 471 (1945) 22.0.0... ccc cece e eens 19

Woods v. Nierstheimer, 328 U.S. 211 (1946) ..........00.0.0.... 19

Zablocki v. Redhail, 434 U.S. 374 (1978) ...........ccccce eee 10

CONSTITUTIONAL PROVISIONS

United States Constitution,

Amendment XIV, Section 1....... 7, 9, 18, 19, 20, 21, 24-28

Louisiana Constitution, Article I, Section 2 ................ 7,21, 27

STATUTES

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vi

RULES

Rules of the Supreme Court of the United States.

I ee ee ee ee ee 10

Rules of Procedure of The Commissioner of Conservation for the

State of Louisiana .

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IN THE UNITED STATES SUPREME COURT

OCTOBER TERM, 1988

LEIGHTON EWELL, ROSA McMILLAN, BETTY CRAIG AND

DOLESE CONCRETE COMPANY

PETITIONERS

v.

HONORABLE HERBERT W. THOMPSON, COMMISSIONER

OF CONSERVATION AND ASSISTANT SECRETARY, OFFICE

OF CONSERVATION OF THE STATE OF LOUISIANA, ET AL.,

RESPONDENTS

ON PETITION FOR A WRIT OF CERTIORARI

TO THE SUPREME COURT OF LOUISIANA

BRIEF IN OPPOSITION

JURISDICTION

Petitioners have invoked this Court's jurisdiction under 28

U.S.C. § 1257(3).

Because petitioners have suffered no injury in fact, because no

personal benefit or practical relief would result from the remedy

sought, and since there is an adequate and independent state ground

for the action of the Louisiana Supreme Court, respondents suggest

that this Court is without jurisdiction over this matter, all as is set

forth fully in the Reasons Why the Petition Should be Denied

beginning at p.10.

STATEMENT OF THE CASE

By Order 1047, dated effective November 21, 1978, the

Commissioner of Conservation of the State of Louisiana defined the

17,600' Tuscaloosa Sand, Reservoir A, Irene Field, in East Baton

Rouge Parish, Louisiana, as that gas and condensate bearing sand

between the intervals of 17,575' - 19,112’ in the South Louisiana

Production, Inc. - R. Kizer #1 Well. The Kizer Well was the

discovery well for the field and the only well drilled at the time of

issuance of this order. Order 1047 also created twenty drilling and

production units (designated as units A-T) for the 17,600’

Tuscaloosa Sand, Reservoir A, each of which was shaped in the

form of a square with an area of one square mile.! Petitioners’

property, which at that time was subject to mineral leases granted by

petitioners to Martin Exploration Company, was located in units S

and T.

On May 17, 1985, Celeron Oil and Gas Company (Celeron),

pursuant to Rule 3 of the Rules of Procedure for Conducting

Hearings Before the Commissioner of Conservation, adopted

effective October 11, 1983 (hereinafter "Rules of Procedure" or

"Rules"), mailed to over eighteen hundred persons known by it to

Own property interests in the Irene Field, written notice of its

intention to file an application with the Commissioner, requesting

him to redefine the 17,600' Tuscaloosa Sand, Reservoir A, Irene

Field; to dissolve the units previously created by Order 1047; and to

create revised drilling and production units based upon geological

boundaries determined by sixteen additional wells which had been

1 For an excellent discussion of the Louisiana Conservation Act and the

effects of creation of a drilling and production unit see Nunez v. Wainoco Oil &

Gas Co., 488 So.2d 955, 959 (La. 1986), cert. denied, 479 U.S. 925 (1986).

drilled since the issuance of Order 1047. No wells had been drilled

during this period in units S and T, the units in which petitioners’

property was located. The pre-application notice advised that a pre-

application conference would be held on June 6, 1985 to discuss

Celeron's proposed application.

After holding the pre-application conference in accordance with

the Rules of Procedure, Celeron filed a formal application with the

Commissioner on June 10, 1985 in accordance with Rule 7 of the

Rules of Procedure. The application also was mailed to over

eighteen hundred people owning interests in the Irene Field.

Pursuant to Celeron's application, the Commissioner of

Conservation prepared a legal notice scheduling a public hearing to

consider Celeron's application on July 23, 1985. The Commissioner

published this legal notice in the official state journal, the Baton

Rouge State-Times on June 15, 1985. The applicant, Celeron,

mailed this legal notice to over eighteen hundred people owning

interests in and around the Irene Field on June 18, 1985. Celeron

additionally had this legal notice published in the official journal for

East Baton Rouge Parish, the Baton Rouge State-Times, on July 2,

1985 and posted the legal notice at the Baker City Hall and East

Baton Rouge Parish Courthouse on June 19, 1985. Baker is a city

in East Baton Rouge Parish, a substantial part of which is located

within the twenty-six square mile pattern of units then in effect for

the Irene Field.

After a public hearing held on July 23 and 25, 1985, the

Commissioner of Conservation issued Order No. 1047-B, dated

effective July 23, 1985. Order 1047-B dissolved the twenty units

created by Order 1047; redefined the sand as that interval between

17,575’ - 17,730' in the Kizer Well; renamed the newly defined sand

the “Upper Tuscaloosa Sand"; recognized two separate

reservoirs, named "Reservoirs A and B" for the Upper Tuscaloosa

Sand; and created, on the basis of geological boundaries, six drilling

and production units for the Upper Tuscaloosa Sand, Reservoir A,

and a single drilling and production unit for the Upper Tuscaloosa

Sand, Reservoir B. The only effect of Order 1047-B on petitioners

was to dissolve units S and T, which had been totally inactive during

their six and one-half-years of existence.

From this order, fourteen plaintiffs, Kaiser Aluminum

Exploration Company, Chevron U.S.A., Kansas City Southem

Railway, Park Lane Enterprises, Inc., Expec Resources, Limited,

Louisiana National Bank, as trustee for the Kirk E. Williams, Jr.

Inter Vivos Trust and Bemadette S. Williams Inter Vivos Trust,

Acme Brick Company, Tolmak, Inc., David Ewell and petitioners

sought injunction and judicial review in the Nineteenth Judicial

District Court in and for the Parish of East Baton Rouge. Made

defendant was Herbert W. Thompson, Commissioner of

Conservation.2 Numerous parties, including respondents,

intervened on the side of the Commissioner seeking a judgment

affirming Order 1047-B.

Only five of the fourteen plaintiffs in the district court alleged

that they failed to receive proper notice; the petition contains no

allegations that these parties would have attended and participated at

the hearing had they received notice. On June 6, 1986, the trial court

upheld the validity of Order 1047-B and dismissed the actions with

prejudice.

2 Commissioner Thompson was replaced in March of 1988 by J. Patrick

Batchelor, the current Commissioner of Conservation.

Eleven of the fourteen plaintiffs appealed this judgment to the

Louisiana Court of Appeal, First Circuit.3 During the pendency of

this appeal, Kaiser Energy, Inc. (a sister company to one of the

parties challenging Order 1047-B, Kaiser Aluminum Exploration

Company), filed a pre-application notice dated September 15, 1986,

pursuant to Rule 3 of the Rules of Procedure advising of its intention

to request the Commissioner to, inter alia, revise certain of the units

created by Order 1047-B. This pre-application notice scheduled a

pre-application conference for October 7, 1986 and was mailed to

numerous parties, including the petitioners. After the pre-application

conference, which none of the petitioners attended, Kaiser Energy,

Inc. filed an application on October 8, 1986 to the Commissioner

requesting a public hearing to accomplish the objectives outlined in

its September 15, 1986 letter. This application was mailed to

numerous parties, including the petitioners.

After a hearing held on November 18, 1986, which none of the

petitioners attended, the Commissioner issued Order No. 1047-B-1,

dated effective November 18, 1986, which denied Kaiser's request

to revise the Order 1047-B units. (Appendix A). Order 1047-B-1

specifically confirmed Order No. 1047-B and ordered that it be

continued in full force and effect. The property which was formerly

in units S and T remained totally inactive from the effective date of

Order 1047-B through the effective date of Order 1047-B-l. No one

filed suit for judicial review of Order 1047-B-1 within the sixty day

time period provided by La. R.S. 30:12, thus, this Order, which

confirmed Order 1047-B and continued it in force and effect, is final

and no longer subject to attack.

3 Acme Brick Company, Tolmak, Inc. and Kansas City Southern Railway

Company, did not join in the appeal of the trial court decision, and thus, the trial ~

court judgment upholding the order is final, non-appealable and entitled to res

judicata effect as to these parties.

Also during the pendency of the appeal, the Commissioner, after

compliance with the Rules of Procedure. held a public hearing on the

application of Celeron and issued Order 1047-B 2, effective

December 11, 1986, which created a single reservoirwide unit forthe

Upper Tuscaloosa Sand, Reservoir A, based on geological

boundaries of the reservoir, and dissolved any then existing drilling

and production units which had been created by the Office of

Conservation Order No. 1047 series of orders which were

inconsistent with the adoption of the reservoirwide unit. (Appendix

B). Petitioners were notified by mail of the pre-application

conference and the public hearing and attended neither. Order 1047-

B-2 is also final, as the delay for seeking judicial review has expired

without any party secking review.

On the basis of Orders 1047-B-1 and 1047-B-2, respondents

filed a Motion to Dismiss the plaintiffs’ appeal on the ground of

mootness. The Court of Appeal denied the Motion to Dismiss.

Kaiser Aluminum Exploration Company v. Thompson, 512 So.2d

1197 (La. App. Ist Cir. 1987).

On appeal to the Louisiana Court of Appeal, petitioners and the

other appellants urged the following assignments of error:

1. The district court erred in finding that adequate notice of the

proposed hearing before the Commissioner of Conservation to

— revise units previously formed by the Commissioner for the

Irene Field had been given.

2. The district court erred in failing to find that Order Number

1047-B was issued by the Commissioner of Conservation in

violation of La. R.S. 30:6 and Rules 3 and 7 of the

Commissioner of Conservation's Ruies of Procedure.

3. The district court erred in failing to find that Order Number

1047-B was issued by the Commissioner of Conservation in

violation of La. R.S. 49:950 et seq.

4. The district court erred in failing to find that Order Number

1047-B was issued by the Commissioner of Conservation in

violation of appellants’ due process rights under the United

States and Louisiana Constitutions.

5. The district court erred in failing to find that the absence of a

Statement of the Underlying Facts supporting Order Number

1047-B's Findings invalidated it.

6. The district court erred in not finding that Order Number

1047-B is invalid because it violates the provisions of La. R.S.

30:3 in that redefining the pool for the Irene Field it excludes

known productive strata and thereby encourages waste and the

drilling of unnecessary wells.

7. The district court erred in finding that the fact that the

effective date of Order Number 1047-B predated the

adjournment of the hearing did not invalidate it.

On February 23, 1988, the Court of Appeal reversed the trial

court's decision based solely on Assignments of Error Numbers 1

and 2. The Court of Appeal specifically pretermitted discussion on

Assignments of Error Numbers 3 through 7.

Respondents filed an application for writ of certiorari with the

Louisiana Supreme Court, citing the following assignments of error:

1. The Court of Appeal erred in its failure to grant the Motion to

Dismiss as to the notice plaintiffs.

. _The Court of Appeal erred in finding that the notice plaintiffs

sustained their burden of proving that substantial nghts of

theirs were prejudiced by failure to give notice.

The Court of Appeal erred in concluding that the statutory

thirty day notice requirement in La. R.S. 30:6(B) can be

satisfied only if there has been complete compliance with all

of the Rules of Procedure for Conducting Hearings Before

the Commissioner of Conservation.

The Court of Appeal erred in finding noncompliance with

Rules 3 and 7 of the Commissioner's Rules of Procedure.

In doing so, the Court of Appeal overturned a specific

factual finding of the trial court without applying or even

considering the manifest error standard.

The Court of Appeal erred in its refusal to follow and apply

all of the Commissioner's Rules of Procedure, particularly

Rule 17, which specifically prohibits the invalidation of a

Commissioner's order for failure to follow the other Rules

of Procedure.

The Court of Appeal erred in invalidating Commissioner's

Rule 17 while at the same time requiring strict compliance

with related Rules 3 and 7.

The Court of Appeal erred in invalidating the entirety of

Order 1047-B as to all persons, even those who received

notice and participated at the hearing, for the failure to give

proper notice to only four of the plaintiffs.

8. The Court of Appeal erred in retroactively applying its

declaration that Rule 17, a properly promulgated rule entitled

to a legal presumption of validity which could be relied on

by the public, is invalid.

Since the Court of Appeal pretermitted the due process question,

the body of respondents’ application did not specifically address the

due process issues, but attached as exhibits to the application were

all briefs filed by the parties in the Court of Appeal. These briefs

included the arguments and authorities cited by all parties on the due

process question.

On May 20, 1988, the Louisiana Supreme Court granted

respondents’ application, reversed the judgment of the Court of

Appeal and reinstated the judgment of the district court.

Petitioners filed an application for rehearing with the Louisiana

Supreme Court urging the Supreme Court, inter alia., to consider

petitioners’ federal due process argument. The application for

rehearing was denied September 9, 1988.

On December 5, 1988, petitioners filed with the Louisiana

Supreme Court a Motion for Certificate as to Existence of a Federal

Question (Appendix C). Petitioners essentially requested the

Louisiana Supreme Court to certify that it did not render its decision

because of mootness or any other independent state ground, and that

it considered and rejected petitione:s' due process arguments. The

Louisiana Supreme Court denied petitioners’ Motion on December 9,

1988.

REASONS WHY THE PETITION SHOULD BE DENIED

1. This Court is Without Jurisdiction to Entertain this

Matter

A. Petitioners Have No Standing to Invoke this

Court's Jurisdiction

The petitioners herein are unable to satisfy the very minimum

constitutional dimension of standing that there be an "actual injury

redressable by the court". 4 Director, etc. v. Perini North River -

Associates, 459 U.S. 297, 305 (1983). Petitioners are also unable to

demonstrate that they would benefit in any tangible way from this

Court's intervention. Warth v Seldin, 422 U.S. 490, 508 (1975).

Petitioners claim that they did not receive written notice of the

public hearing resulting in the issuance of Order No. 1047-B which

had the effect of dissolving twenty geographic units previously

established by Order No. 1047. Order 1047-B affected petitioners

only by removing their property from undrilled non-producing units,

which had been totally inactive from their inception (and thus, units

from which petitioners had never participated in production) to a

situation where their property was unaffected by any unit.

4 Respondents are uncertain whether the disclaimer contained in footnote 1 of the

petition that the plaintiffs below who are not petitioners “have not presented this

petition” is sufficient to eliminate them as parties in this Court pursuant to Rule

19.6 of the Rules of the United States Supreme Court. We note however, that as

all of them received actual mailed notice of the hearing at issue, they would be

without standing to raise lack of notice as to petitioners. Moreover, they clearly

are bound by Order 1047-B regardless of what this Court might conclude as to the

binding effect of Order 1047-B on petitioners. See e.g., Zablocki v. Redhail, 434

U.S. 374, 381 N. 6 (1978); Union Texas, etc. v. Corporation Commission, etc.,

651 P.2d 652 (Okl. 1981), cert. denied 459 U.S. 837 (1982).

10

ee OF

Following dissolution of those units petitioners were free to drill

wells upon the property without the requirement of sharing the

production in accordance with the geographic units formed by Order

No. 1047. Thus, Order 1047-B did not deprive petitioners of

participation in production but did remove a restriction on their

property nights by dissolving the unit affecting their property.

The Louisiana Supreme Court has specifically recognized that

the creation of a drilling and production unit on a person's property

by the Commissioner is an infringement of the property rights of its

owner. Nunez v. Wainoco Oil & Gas Co., 488 So.2d 955 (La.

1986), cert. denied, 479 U.S. 925 (1986). The Louisiana Supreme

Court stated:

By prohibiting an individual landowner in the unit from

drilling wells on their own tracts, by forcing them to share

production and by limiting the hydrocarbons that can be

produced, the exercise of the Commissioner's power to

unitize necessarily results in infringement on the usual rights

of ownership. 488 So.2d at 963.

Since Order 1047-B did not in any way affect petitioners’ right

to participate in production but instead removed a restriction on their

property rights, petitioners are unable to establish the threshold

requisite of standing; injury.

Moreover, petitioners are unable to establish that any alleged

injury that they have suffered is redressable in any meaningful way

by the Court. The allegedly tainted Order No. 1047-B was

confirmed and continued in force and effect by Order 1047-B-1 and

superseded by Order No. 1047-B-2. (Appendix A and B). It is

undisputed that the petitioners received mailed notice of the pre-

application conference, the application and the official legal notice of

11

the hearings that resulted in these orders.

Because no suit was filed within the sixty day period allowed for

judicial review (La. R.S. 30:12A [2)), it is undisputed that the units

created by Order 1047-B and confirmed by Order 1047-B-1 are final

and binding on all parties from November 18, 1986 forward. The

Louisiana Court of Appeal recognized this fact in its opinion, stating

that the only period at issue in the instant case is July 23, 1985 (the

effective date of Order 1047-B) to November 18, 1986 (the effective

date of Order 1047-B-1).

Under these circumstances, the only result of a declaration that

Order 1047-B was invalid would be to recreate the legal fiction that

petitioners’ land was included in a non-producing, undrilled unit

from July 23, 1985 to November 18, 1986. The petitioners have no

claim for damages and there would be no redistribution of royalties

or other monies with respect to petitioners. No personal benefit

would result to petitioners from the remedy that they seek.5

None of the petitioners alleged or testified that they would have

attended the challenged 1985 hearing had they received mailed

notice.© The absence is fatal to their standing to invoke this Court's

5 Respondents recognize that it has been suggested that a failure to comply

with procedural requirements of itself establishes a sufficient injury to confer

standing, City of Davis v. Coleman, 521 F.2d 661 (9th Cir. 1975), although even

in such circumstances the alleged injuries must be susceptible to being remedied.

South East Lake View Neighbors v. Dept. of Housing, 685 F.2d 1027 (7th Cir.

1982).

6A representative of petitioner Dolese Concrete was the only one of

petitioners to testify on this issue and he was unable to affirmatively state that

Dolese would have attended had it been given notice. The strongest testimony that

le could muster was that there was "a possibility” that they would have attended.

12

jurisdiction. Nat'l Conservative Political v. Federal Election, 626

F.2d 953 (D.C. Cir. 1980).

It might appear curious to the Court that these petitioners, who

have nothing to gain, and who have shown total disinterest in

subsequent unitization proceedings, continue to incur the costs of

litigating this case. The undisputed evidence introduced at trial is that

Kaiser Aluminum Exploration Company, who received actual notice

and participated in the hearing, solicited and paid petitioners to join in

this litigation to raise the notice issue. Kaiser's interest in production

from the Irene Field was drastically reduced by Order 1047-B.

For these reasons we respectfully submit that petitioners have no

standing to invoke this Court's jurisdiction.

B. The Case is Moot

The facts set forth hereinabove also demonstrate that this case

has become moot.

In the Louisiana Court of Appeal respondents filed a Motion to

Dismiss on the basis of mootness. Respondents cited Hunter Co. v.

McHugh, 320 U.S. 222 (1943) as authority that the instant case had

become moot. In Hunter the plaintiff claimed that Order No. 28-B of

the Commissioner of Conservation was invalid because it

unconstitutionally deprived it of three separate property interests

without just compensation: 1) the value of its lease; 2) the cost of

drilling a well; 3) the cost of laying a pipeline. Subsequently, the

Commissioner promulgated Order No. 28-C that prescibed enlarged

drilling units comprising 640 acres but did not satisfy any of the

plaintiff's three complaints. A later Order, No. 28-C-10, satisfied

only the plaintiff's second and third claims for compensation.

13

Even though the plaintiff therein maintained his claim that Order

No. 28-B was null and void because it constituted a taking of

plaintiff's lease without compensation, this Honorable Court ruled

that Order No. 28-C and Order No. 28-C-10 had superseded the

operation of Order 28-B rendering the appeal moot. It is significant

that in Hunter there was an “interim period" between the

promulgation of Order No. 28-B and Order No. 28-C, for which

period plaintiff would have been entitled to one hundred percent of

the production from its lease if Order No. 28-B was invalid. Despite

that fact, and despite the fact that plaintiff did not in the subsequent :

Orders receive all the relief which he claimed he was entitled, the

appeal was ruled to be moot and the case ultimately dismissed for

want of a properly presented substantial federal question.

The Court of Appeal refused to apply Hunter on the basis that

more recent United States Supreme Court cases have more fully

defined the concept of mootness citing County of L.A. v Davis, 440

U.S. 625 (1979).

Instead, the Court of Appeal specifically ruled that "according to os

Louisiana jurisprudence, a moot case is one which, when rendered,

can give no practical relief. Courts will not rule on questions of law

which have become moot since their decree will serve no useful

purpose and afford no practical relief", citing Buchanan v. State Civil

Service Commission, 372 So.2d 1065 (La. App. Ist Cir. 1979).

The Court of Appeal held that:

If on appeal any one of these three issues is resolved in favor

of plaintiff-appellants, it could result in invalidation of Order

1047-B and the redistribution of royalties. This fulfills the

requirement that there be "practical relief" that the Court can

render. See In the Matter of Delahoussaye, 402 So.2d 308

(La. App. Ist Cir. 1981). cert. denied 413 So.2d 494 (La.

14

1982). 512 So.2d at 1200.

Thus, the Court of Appeal specifically recognized that the cause in

this matter would be moot unless invalidation of Order 1047-B could

afford the plaintiffs "practical relief" in the form of a redistribution of

royalties for the period from July 23, 1985 to November 18, 1986.

While the Court of Appeal correctly stated the Louisiana law on the

issue of mootness, the Court was clearly in error in its application of

the law to the facts of this case as set forth hereinabove.

On application for Writ of Certiorari the Louisiana Supreme

Court was urged that not only would the invalidation of Order 1047-

B provide no "practical relief" to petitioners, invalidation of the Order

would provide them no relief of any kind whatsoever. Invalidation

of Order 1047-B for the sixteen month period at issue would only

have the effect of resurrecting the units created by Order 1047 for

this limited period of time and, because the two units in which the

petitioners had interests, units S and T, were undrilled, non-

productive units from which petitioners shared no production and

received no royalties there would be no redistribution of royalties or

any other monies to petitioners, contrary to the reasoning on which

the Louisiana Court of Appeal based its denial of the Motion to

Dismiss.

It is thus clear, as a matter of Louisiana law, that this case is

moot because a declaration that Order 1047-B was invalid for this

limited period of time would result in no "practical relief" to

petitioners.

Furthermore, respondents respectfully suggest that this case is

also moot as a matter of federal law. The reasoning contained in

Hunter is equally applicable to the instant case and the more recent

jurisprudence does not alter that conclusion.

15

In Natural Resources Defense Council v. United States Nuclear

Regulatory Commission, 680 F.2d 810 (D.C. Cir. 1982) it was held

that the repromulgation of a rule in accordance with the

Administrative Procedure Act's procedural requirements moots a

claim that the same rule was previously issued without notice and

comment. The Court reasoned that although the petitioners were

deprived of the opportunity to participate in the initial promulgation

of the rule, they were "undeniably provided that opportunity... when

[the agency] repromulgated the rule in accordance with the

requirements of... the Administrative Procedure Act." /d. at 814.

The Court concluded that this opportunity provided the petitioner

with “everything that it could recover" /d. at 814 quoting California

v. San Pablo & Tulare Railroad, 149 U.S. 308. 314 (1893).

Similarly in Save Our Cumberland Mountains, Inc. v. Clark,

725 F.2d 1422 (D.C. Cir. 1984) the Court held that the plaintiffs’

claim against the Secretary of Interior challenging rule making

because it violated the notice and comment requirements of the

Administrative Procedure Act was rendered moot by the Secretary's

subsequent procedurally correct promulgation of a superseding rule,

because the plaintiffs, who received the opportunity to participate

meaningfully in the subsequent rule-making process, received all the

relief necessary to eradicate the effects of the allegedly unlawful

initial rule making. The case also involved an interim period between

the defective agency action and the superseding rule. The Court

rejected the argument that the possibility of relief by reinstating the

initial valid rule during this interim period saved the case from being

moot. Finding that such an argument mischaracterized the

deprivation caused by the procedural defect, the Court noted that the

loss suffered was the loss of opportunity to participate which

opportunity the plaintiffs had received. The Court also found that

any ruling by it with respect to the "interim period" would not change

16

the status quo. As has been demonstrated hereinabove the same is

true in the instant case.

The rule that a claim does not become moot where it is capable of

repetition, yet evades review, is likewise inapposite. The Court in

Natural Resources Defense Counsel, Inc., 680 F.2d at 814

recognized that curative agency action pursuant to notice and

comment is more accurately characterized as the provision of

appropriate relief than as the “cessation of iliegal conduct".

Furthermore, the capable of repetition doctrine applies only in

exceptional circumstances, and generally only where the named

plaintiff can make a reasonable showing that he will again be

subjected to the alleged illegality. City of Los Angeles v. Lyons,

461 U.S. 95, 109 (1983). This Court has required the showing of a

“reasonable expectation" or a “demonstrated probability" that the

same controversy will recur involving the same complaining party.

Murphy v. Hunt, 455 U.S. 478, 482 (1982); Weinstein v. Bradford,

423 U.S. 147, 149 (1975).

There is no allegation contained in the record of this case that

future action of the Commissioner of Conservation taken without

notice would likely affect the petitioners. Instead, the undisputed

fact is that the petitioners received individual mailed notice of both of

the hearings subsequent to the challenged Order. Petitioners have

presented no evidence creating a reasonable expectation that the

Commissioner of Conservation will repeat its purportedly

unauthorized actions in subsequent proceedings. Any prospect of

repetition is thus too speculative to avoid mootness.

For these reasons, respondents suggest that the issues sought to

be raised are moot as to the petitioners and that the writ should be

denied on that ground.

17

C. No Substantial Federal Question; Adequate and

Independent State Grounds

The jurisdiction of this Honorable Court pursuant to 28 U.S.C.

§ 1257(3) to review this case is subject to serious doubt. There

clearly exists an adequate and independent state ground for the action

of the Louisiana Supreme Court; this case is moot as a matter of

Louisiana law. Buchanan v. State Civil Service Commission, 372

So.2d 1065 (La. App. 1st Cir. 1979).

On Application for Writ of Certiorari to review the decision of

the Court of Appeal for the First Circuit, the Louisiana Supreme

Court was urged by respondents that invalidation of Order 1047-B

would not only fail to provide "practical relief" to the petitioners but

that invalidation of the order would provide to them no relief of any

kind whatsoever. The Louisiana Supreme Court granted the Writ of

Certiorari and summarily reversed the judgment of the Court of

Appeal.

On December 5, 1988 petitioners filed a Motion for Certificate as

to Existence of a Federal Question in the Supreme Court of Louisiana

wherein they represented that the summary reversal left petitioners

without a means to establish jurisdiction in the United States

Supreme Court. (Appendix C). Petitioners also stated that if the

Louisiana Supreme Court concluded that the appeals of the

petitioners were moot then it necessarily followed that the Louisiana

Supreme Court did not reach the constitutional issues, which would

have a direct bearing on the jurisdiction of the Supreme Court of the

United States. Petitioners thus endeavored to have the Louisiana

Supreme Court execute a Certificate as to Existence of a Federal

Question, prepared by petitioners, stating that the Louisiana Supreme

Court's reversal was not based upon a finding that the appeals were

moot and that the reversal was based upon the due process clause of

18

the Fourteenth Amendment of the United States Constitution.

On December 9, 1988 the petitioners’ Motion for Certificate as

to Existence of a Federal Question was denied without comment.

Where the highest state court has entered no written opinion,

despite the raising of both federal and state questions, as in this case,

the traditional approach of this Court has been to determine whether

the state ground raised in the record is adequate to support the

judgment, and if so, it has been presumed that the judgment was

based on the state ground and jurisdiction has been declined. Lynch

v. New York ex rel. Pierson, 293 U.S. 52, 54-55 (1934); Adams v.

Russell, 229 U. S. 353, 358-59 (1913); Woods v. Nierstheimer,

328 U. S. 211, 216 (1946); Phyle v. Duffy, 334 U. S. 431, 437

(1948); Williams v. Kaiser, 323 U.S. 471, 477-78 (1945). In such

circumstances petitioners have been required to demonstrate that the

state grounds could not account for the decision below. Durley v.

Mayo, 351 U. S. 277, 281 (1956). It has not been sufficient to

show that the judgment below "might have rested upon a nonfederal

ground." Stembridge v. Georgia, 343 U. S. 541, 547 (1952); Ellis

v. Dixon, 349 U. S. 458, 459 (1955).

In cases in which a state court decision fairly appears to rest

primarily on federal law, or to be interwoven with the federal law,

and when the adequacy and independence of any possible state law

ground is not clear from the face of the opinion, this Court has

recently applied a new presumption that the state court decided the

case the way it did because it believed that federal law required it to

do so. Michigan v. Long, 463 U. S. 1032, 1040-1041 (1983). The

test applied in Michigan is not susceptible to application in this case.

Neither of the decisions of the Louisiana Court of Appeal rest upon

federal law and there is no opinion of the Louisiana Supreme Court.

19

While it is impossible to say with certainty that the Louisiana

Supreme Court based its reversal on the issue that the case was moot

as a matter of state law, that adequate and independent state ground

clearly exists and likely was the basis of the Louisiana Supreme

Court's decision. A determination that the case is moot is certainly

broad enough, without reference to any federal question implicated

by this case, to sustain the state court judgment, notwithstanding any

error in deciding the federal question.

Petitioners have recognized their inability to establish jurisdiction

in this court without a statement from the Louisiana Supreme Court

that its decision was based upon federal law. The Louisiana

Supreme Court's denial of the Motion for Existence of a Substantial

Fedcral Question should be interpreted as meaning that the Louisiana

Supreme Court is of the opinion that its decision was based upon an

independent state law ground, particularly since petitioners

represented to that court that denial of the motion would result in

their inability to establish jurisdiction in this Honorable Court. As a

result, respondents respectfully suggest that this Honorable Court is

without jurisdiction to entertain this case.

2. Neither the Decision Below Nor the Record

Raises the Question Presented in the Petition

The sole question presented in the petition is :

Whether the longstanding practice of the Commissioner of

Conservation for the State of Louisiana of notice of hearings

by publication is sufficient to satisfy the due process

requirements of the Constitution of the United States.

Neither of the published opinions by the Louisiana Court of Appeal

20

deal with that issue and it was not necessary for the Louisiana

Supreme Court to reach that question because of mootness.

Morcover the facts of the record will not support a determination

of that question by this Court. The premise underlying the question

presented is that it is the longstanding practice of the Commissioner

of Conservation to give notice of hearings affecting oil and gas

interests only by publication. That premise is supported neither by

the record nor even by the petition. While it has been the

longstanding practice of the Commissioner of Conservation to satisfy

the specific thirty day notice requirements of La. R.S. 30:6(B) by

publication of a legal notice in the official state journal, the Office of

Conservation has recognized that the due process provisions of both

the Louisiana and United States Constitutions require additional

notice to certain partics when the Commissioner of Conservation

adjudicates rights of owners of oil and gas interests by establishing

or modifying drilling and production units.

In order to satisfy and exceed duc process requirements, the

Rulcs of Procedure provide for many other ways of providing notice

to supplement the Section 6(B) thirty day notice. (sce Petition,

Appendix H). The Office of Conservation has consistently followed

these procedures since their adoption in 1983.

Under Rule 3 any party intending to apply for a hearing must

send a pre-application notice outlining the proposal to the

Commissioner with a copy to each interested owner and represented

party. The applicant must makc a reasonable effort to determine to

whom the notices must be sent in accordance with the rule. If a

timely request is made, the applicant must hold a conference at which

he must explain the geological and engineering bases for his

proposal, and allow other partics with different proposals to do

likewise.

21

Thereafter, pursuant to Rule 7, the party may apply to the

Commissioner for a public hearing to consider his unit proposal.

His application must also be mailed to each interested owner and

represented party. After the Commissioner prepares and publishes

the legal notice reflecting the time, date, place and nature of the

hearing, the applicant is required to mail the legal notice to all

interested owners, represented parties and interested parties along

with a copy of the unit plat if said parties have not already been

furnished same. Additionally the applicant is required to provide for

the posting of a copy of the legal notice and the unit plat in a

prominent place in the area affected and to provide for publication of

a copy of the legal notice in the newspaper published in the vicinity

or general area of the affected field at least fifteen days before the

hearing. Evidence to establish compliance with these posting,

publishing and mailing requirements is required to be submitted at

the hearing.

Thus petitioners’ suggestion that this Court should grant the wnt

to rectify the Louisiana Supreme Court's sanction of a longstanding

administrative practice of providing notice only by publication is

totally lacking foundation.

The real facts regarding notice of the subject hearing, as set forth

in the Statement of the Case hereinabove, is in stark contrast to the

picture painted by petitioners. The list of over 1,800 people that

were mailed copies of the pre-application notice, the application and

the legal notice of the hearing was compiled by the applicant during

nine years of exhaustive and expensive record searches and title

work. This effort included two entire years of having several

employees working full time at the East Baton Rouge Court House

researching the ownership of the twelve units (units A-L) which it

had requested the Commissioner to form and in which it had

ze

substantial interest. This list was supplemented by the applicant

calling some of the other known mineral lessees in the field and

requesting that they provide a list of their royalty owners for

inclusion on this mailing list. Units M - T (which include units S

and T in which petitioners’ property is located) were originally

formed at the request of Martin Exploration Company, and a

representative of the applicant called Martin Exploration Company

and asked for a list of its royalty owners in the Irene Field.

Thus the only potential issue is, considering the minimal and

beneficial impact of Order 1047-B on the owners in units M - T,

whether due process required the Commissioner or the applicant, in

addition to the request to Martin Exploration Co., to engage in an

extended, impractical search for the names and addresses of all

parties owning interests in this highly populated eight square mile

area.

Making this matter more unique is petitioners' argument that "no

effort was made to notify the owners in units M - T". Petitioners

argue that while the representative of Celeron made a request to

Martin Exploration Company for a list of its royalty owners, his

unexpressed intention was to receive only a list of royalty owners

from Martin Exploration Company within units A - L. The District

Court rejected this argument and found that the applicant had

requested Martin Exploration Company to provide it with a list of

royalty owners, whereas the Court of Appeal used the unexpressed

intention of this representative to rule that no effort had been made by

the applicant to compile a list of the owners in units M-T. One of the

assignments of error in the respondents’ application for Writ of

Certiorari to the Louisiana Supreme Court was the Court of Appeal's

improper reversal of this factual finding of the District Court without

applying the "manifest error” rule applicable in Louisiana.

23

The foregoing illustrates that the issues involved here are not of

general application and any ruling by this Court likely will apply only

to this very unique case.

3. The Decision of the Louisiana Supreme Court

Does Not Conflict With Decisions of this Court

Even if the Louisiana Supreme Court did consider the due

process issue, its decision does not conflict with Mullane v. Central

Hanover Bank and Trust Co., 339 U.S. 306 (1950), Mennonite

Board of Missions.v. Adams, 462 U.S. 791 (1983) or Tulsa

Professional Collection Services, Inc. v. Pope, ___U.S.__, 108

S.Ct. 1340 (1988) as contended by petitioners. These cases define

the requirements of due process in the context of a judicial

proceeding. The action being reviewed is an administrative

adjudication, and this court has repeatedly held that the more strict

due process requirements applicable to judicial proceedings need not

be applied to administrative adjudications. Mathews v. Eldridge,

424 U.S. 319, 348 (1976); Dixon v. Love, 431 U.S. 105, 115

(1977). Even applying judicial standards, while Mullane did hold

that notice effected by publication was insufficient in many instances,

this court made the following comments approving of notice by

publication in certain circumstances:

This Court has not hesitated to approve of resort to

publication as a customary substitute in another class of

cases where it is not reasonably possible or practicable to

give more adequate warning. Thus it has been recognized

that, in the case of persons missing or unknown,

employment of an indirect and even a probably futile means

of notification is all that the situation permits and creates no

constitutional bar to a final decree foreclosing their nghts.

(Citations omitted.)

24

Those beneficiaries represented by appellant whose interests

or whereabouts could not with due diligence be ascertained

come clearly within this category. As to them the statutory

notice is sufficient. However great the odds that publication

will never reach the eyes of such unknown parties, it is not

in the typical case much more likely to fail than any of the

choices open to legislatures endeavoring to prescribe the best

Nor do we consider it unreasonable for the State to dispense

with more certain notice to those beneficiaries whose

interests are either conjectural or future or, although they

could be discovered upon investigation, do not in the due

course of business come to knowledge of the common

trustee. Whatever searches might be required in another

situation under ordinary standards of diligence, in view of

the character of the proceedings and the nature of the

interests here involved, we think them unnecessary. We

recognize the practical difficulties and costs that would be

attendant on frequent investigations into the status of great

numbers of beneficiaries, many of whose interest in the

common fund are so remote as to be ephemeral; and we have

no doubt that such impracticable and extended searches are

not required in the name of due process. The expense of

keeping informed from day to day of substitutions among

even current income beneficiaries and presumptive

remainderman, to say nothing of the far greater number of

contingent beneficiaries, would impose a severe burden on

the plan, and would likely dissipate its advantages. These

are practical matters in which we should be reluctant to

disturb the judgment of state authorities. Mullane, at 317-

318 and 658-659. (Emphasis added)

25

Even petitioners recognize (see p. 13 of the Petition) that

Mullane and its progeny have made clear that the issue of the

sufficiency of notice is not subject to a single rule of universal

application requiring mailed notice under all circumstances.

Petitioners correctly recognize that in this case, the sufficiency of

notice is to be evaluated in light of the effect that requiring actual

notice may have on important state interests and the reasonability of

ascertaining the identity of persons affected by state action (see p. 13

of the Petition). This Court has also considered, in evaluating the

sufficiency of notice, the nature of the private interests involved and

the effect of the proposed state action on those interests. Mullane,

supra; Mathews v. Eldridge supra at 906.

The latter two factors have previously been discussed in this

brief and will not be repeated here.

There are undeniably important state interests involved here.

The units created by Order 1047 were arbitrary square units not

reflecting the true geological boundaries of the reservoir, since they

were created at a time when only one well was present and the areal

extent of the reservoir was unknown. After the field had becn

developed by the drilling of sixteen additional wells the

Commissioner became aware through the application that the

geological boundaries of the reservoir were ascertainable. Large

areas within the units which had been sharing in production were

shown by this drilling activity not to be underlain by the reservoir.

Continuing the allocation of production to these non-productive areas

would have deprived the owners of the truly productive area of their

just and equitable share of production from the reservoir. This

information compelled the Commissioner to revise the units as soon

as possible, not only because of the statutory mandate set forth in the

Louisiana Conservation Act, but also because of the dictates of the

26

substantive due process provisions of the United States and

Louisiana Constitutions preventing the taking of property rights

without compensation. Requiring actual notice to all parties in this

case would have significantly delayed the proceeding and the

consequent equitable adjustments to the allocation of production.

The essence of the problem was summarized concisely by the

testimony of Lawrence Ringham, the president of Park Lane

Enterprises, Inc., one of the plaintiffs below. After identifying Park

Lane's leases in yellow on Exhibit P-22 (Prel. Inj. Transcript, pp 41-

2), Ringham admitted that approximately half of this acreage was

outside the productive area of the Irene Field, even under the

gedlogical interpretation that Park Lane asked the Commissioner to

adopt (Prel. Inj. Transcript, p 56). Mr. Ringham then testified as

follows:

ABELL: Okay. If you've got $2.5 million based on

receiving 100% of the yellow acreage, then in

fact you received $1.25 million for production

attributable to lands which even your

geologist couldn't believe had any gas or oil

under it. Is that correct?

RINGHAM: That is correct.

ABELL: And you wish the squares would have stayed

like that so you would continue to get all that

production, don't you?

RINGHAM: Obviously that's the optimum, I'm a

businessman, Mr. Abell.

See Prel. Inj. Transcript, pp. 59-60.

27

The importance of the state interest in quickly rectifying the

inequitable allocation of production caused by its earlier order must

be weighed heavily in the due process analysis .

In summary, this case may involve the application of this

Court's decisions regarding sufficiency of notice to the facts of the

instant case, but the Louisiana Supreme Court's decision is in no

way in conflict with those decisions. The unusual facts of this case

make it unique and any decision by this Court would affect few, if

any, other litigants.

CONCLUSION

For these reasons, the Petition for a Wnt of Certiorari should be

denied.

Respectfully submitted,

Randall C. Songy*

R. Thomas Jorden, Jr.

ONEBANE, DONOHOE,

BERNARD, TORIAN,

DIAZ, MCNAMARA & ABELL

P. 0. Box 3507

Lafayette, Louisiana 70502

(318) 237-2660

Attomeys for Respondents

Celeron Oil and Gas Company,

First Energy Corporation,

Union Texas Petroleum,

TXO Production Corporation,

William J. Guste, Jr.

Attorney General

Gary L. Keyser

Assistant Attomey General

Mary Ellen Leeper

Assistant Attomey General

P.O. Box 2827

Baton Rouge, Louisiana 70821

(504) 342-4604

Attorneys for Respondent

Commissioner of Conservation

Borden, Inc., and Terra Resources, Inc. *Counsel of record

28

APPENDIX A

STATE OF LOUISIANA

OFFICE OF CONSERVATION

ATON E ISIANA

December 5, 1986

RDER 1047-B-1

Order concerning the dissolution of the units created by

order No. 1047-A for the 17600' Tuscaloosa Sand,

Reservoir A and denying the application for revision of the

U TUSC RA SUD and U TUSC RA SUE created by Office

of Conservation Order No. 1047-B for the Upper

Tuscaloosa Sand, Reservoir A, IRENE FIELD, East Baton

Rouge Parish, Louisiana.

2h He ee he he 2c 2c he aie he ae he ee he ae fe ae ake he ae 2h ae fe ote ae ake oe fe ae 2 oe ake oc ke fe ae ae fe ake fe ake he ake fe ake ae ake ake ake ake kc ok

Pursuant to power delegated under the laws of the State of

Louisiana, and Particularly Title 30 of Louisiana Revised Statutes of

1950, and after a public hearing held under Docket No. 86-703 in

Baton Rouge, Louisiana, on November 18, 1986, upon the

application of KAISER ENERGY, INC. following legal publication

of notice and notice in accordance with rules prescribed by the

Commissioner of Conservation, the following order is issued and

promulgated by the Commissioner of Conservation as being

reasonably necessary to conserve the natural resources of the state,

to prevent waste as defined by law, to avoid the drilling of

unnecessary wells, and otherwise to carry out the provisions of the

laws of this State.

A-1

DEFINI

The 17600' Tuscaloosa Sand, Reservoir A in the Irene Field,

East Baton Rouge Parish, Louisiana was fully defined in Office of

Conservation Order No. 1047, effective November 21, 1978.

The Upper Tuscaloosa Sand, Reservoir A in the Irene Field,

East Baton Rouge Parish, Louisiana was fully defined in Office of

Conservation Order No. 1047-B effective July 23, 1985.

FINDINGS

The Commissioner of Conservation finds as follows:

1. That Office of Conservation Order No. 1047-A, effective

September 18, 1979, created five (5) drilling and production units

for the exploration for and production of gas and condensate from

the 17600' Tuscaloosa Sand, Reservoir A, in the Irene Field, East

Baton Rouge Parish, Louisiana, said units being designated 17600

TUSC RA SU JU, V, W, X, and Y.

2. That Office of Conservation Order No. 1047-B, effective

July 23. 1985. established rules and regulations and created drilling

and production units, for the exploration for and production of gas

and condensate from the Upper Tuscaloosa Sand, Reservoir A, in

the Irene Field, East Baton Rouge Parish, Louisiana, including the

units designated U TUSC RA SUD and U TUSC RA SUE.

3. That the additional geological and engineering data obtained

since the issuance of such orders held herein establishes that there

should be no change in ihe U TUSC RA SUD and U TUSC RA

SUE created by Order 1047-B, and accordingly all request to revise

such units should be denied.

4. That the same evidence establishes that the 17600 TUSC RA

SU U, V, W, X, and Y created by order No. 1047-A appear to be

non-productive and therefore should be dissolved.

ORDER

NOW, THEREFORE, IT IS ORDERED THAT:

1. In view of the above Findings, all request for revision of the

U TUSC RA SUD and U TUSC RA SUE created by Office of

Conservation Order No. 1047-B effective July 23, 1985, be and are

hereby denied, and Order 1047-B is hereby confirmed and continued

in force and effect.

2. The 17600 TUSC RA SU JU, V, W, X and Y, created by

Office of Conservation Order No. 1047-A effective September 18,

1979 be and they are hereby dissolved.

This order shall be effective on and after November 18, 1986.

OFFICE OF CONSERVATION

OF THE STATE OF LOUISIANA

JRA: 1be /s/ Herbert W. Thompson

Denial HERBERT W. THOMPSON

Dis Unit COMMISSIONER OF CONSERVATION

APPENDIX B

STATE OF LOUISIANA

OFFICE OF CONSERVATION

ATONR E ISIANA

December 22, 1986

RDER NO, 1047-B-2

Order concerning dissolution of any currently existing

drilling and production units created by the Office of

Conservation Order 1047 Series of Orders which are

inconsistent with the adoption of the proposed reservoirwide

unit, and the simultaneous creation of a reservoirwide unit

for the Upper Tuscaloosa Sand, Reservoir A, in the IRENE

FIELD, East Baton Rouge Parish, Louisiana.

ae ke ic i fc ke oc 2 2c 2c oc ofc akc ke ok 2 ake ok ok fe 2k ake 2 a af kc aie 2 oc ake ac ake afc ak 2 ake ae oe fe ote oe ate ote ke aie ae ae ee

Pursuant to power delegated under the laws of the State of

Louisiana, and particularly Title 30 of the Louisiana Rev.sed Statutes

of 1950, and after a public hearing held under Docket No. 86-702 in

Baton Rouge, Louisiana, on December 11, 1986, upon the

application of Celeron Oil and Gas Company, following legal

publication of notice and notice in accordance with rules prescribed

by the Commissioner of Conservation, the following order is issued

and promulgated by the Commissioner of Conservation as being

reasonably necessary to conserve the natural resources of the State,

to prevent waste as defined by law, to avoid the drilling of

unnecessary wells and otherwise to carry out the provisions of the

laws of this State.

A-4

DEFINITIONS

The Upper Tuscaloosa Sand, Reservoir A, in the Irene Field,

East Baton Rouge Parish, Louisiana, was previously defined in

Office of Conservation Order No. 1047-B.

"Unit Agreement,” as used herein shall mean and refer to the

agreement which sets forth the plan and terms of unit operation and

which was admitted into evidence in connection with Docket No. 86-

702". Said agreement is on file in the official records of the Office of

Conservation in Baton Rouge, Louisiana, and is made a part hereof

by special reference.

FINDINGS

The Commissioner of Conservation finds as follows:

1. That Office of Conservation Order No. 1047-B, effective

July 23, 1985, created six (6) drilling and production units,

designated SU A, B, C, D, E, and F, for the Upper Tuscaloosa

Sand, Reservoir A in the Irene Field, East Baton Rouge Parish,

Louisiana.

2. That the additional geological and engineering evidence

obtained since the creation of these units indicates that the units

designated SU A, B, C, D, E, and F, heretofore created, should be

dissolved and, simultaneously, there should be created a single

reservoirwide unit comprised of the entire Upper Tuscaloosa Sand,

Reservoir A, in the Irene Field, East Baton Rouge Parish, Louisiana,

in accordance with the provisions of LSA-R.S. 30:5C.

A-5

3. That the said evidence establishes that the creation of the said

reservoirwide unit is reasonably necessary for the prevention of

waste and the drilling of unnecessary wells, and will appreciably

increase the ultimate recovery of gas and condensate from the

reservoir.

4. That the said evidence establishes that the proposed unit

operation submitted by applicant is economically feasible, and should

be approved and adopted.

5. That the Unit Area as shown on the plat labeled, "Celeron Oil

and Gas Company Exhibit No. 4 for Docket No. 86-702", a copy of

which is attached hereto and made a part hereof, is reasonable,

comprises the entire known productive area of the Upper Tuscaloosa

Sand, Reservoir A in the Irene Field, East Baton Rouge Parish,

Louisiana, and it should be established and adopted as a single

reservoirwide unit for the exploration for and production of gas and

condensate from said reservoir.

6. That the separately owned tracts, mineral leases and other

property interests within the Unit Area created herein should be force

pooled and integrated, with each separate tract sharing in unit

production in accordance- with the schedule designated Tract

Participation on the plat labeled, "Celeron Oil and Gas Company

Exhibit No. 4 for Docket No. 86-702", which schedule is also

attached to the Unit Agreement as Exhibit C.

7. That the allocation of unit production to each separate tract

within the Unit, in accordance with Finding No. 6, shall insure the

recovery by the owners of that tract of their just and equitable share

of the recoverable gas and condensate in Upper Tuscaloosa Sand,

Reservoir A, Irene Field, East Baton Rouge Parish, Louisiana, and

A-6

therefore, said method of allocation should be approved and adopted.

8. That the evidence received at the hearing establishes that the

B-3Unit Agreement, which covers the plan and terms of unit

operations, has been signed and executed by more than three-fourths

in interest of the Owners and more than three-fourths in interest of

the Royalty Owners in the Unit Area, calculated in accordance with

LSA-R.S. 30:5C; that said Unit Agreement was filed with the

Commissioner of Conservation on or before the day set for the

hearing; and that said Unit Agreement should be approved and

adopted insofar as authorized by the provisions of LSA-R.S. 30:5C.

9. That Celeron Oil and Gas Company should be designated as

the operator of the unit created herein. ‘

10. That the costs and expenses of the unit operation should be

bome by the Owners of the tracts included within the reservoirwide

unit in the same proportion that said tracts share in unit production, in

the absence of a voluntary agreement to the contrary.

11. That to provide for efficiency in operations and to permit any

additional wells to be located at optimum positions, the spacing rules

of the Office of Conservation Order 1047 Series and Statewide Order

No. 29-E should not apply to wells drilled within the Unit Area.

12. That the reservoirwide unit herein created should be granted

a single reservoir allowable which can be produced from any well or

wells in the unit, at Operator's option, subject to applicable Statewide

Orders.

A-7

RDE

NOW, THEREFORE, IT IS ORDERED THAT:

1. The drilling and production units heretofore created by Office

of Conservation Order No. 1047-B designated SU A, B, C, D, E

and F, be and they are hereby dissolved and simultaneously there is

created a single reservoirwide unit compromised of the entire Upper

Tuscaloosa Sand, Reservoir A in the Irene Field, East Baton Rouge

Parish, Louisiana, all in accordance with the provisions of LSA-

R.S. 30:5C. said reservoirwide unit being shown on the plat labeled,

"Celeron Oil and Gas Company Exhibit No. 4 for Docket No. 86-

702", a copy of which is attached hereto and made a part hereof.

2. All separately owned tracts, mineral leases and other property

interests within the reservoirwide unit herein established are hereby

pooled, consolidated, and integrated in accordance with LSA-R.S.

30:5C and 10, with each tract sharing in unit production in

accordance with the schedule designated Tract Participation on the

plat labeled, "Celeron Oil and Gas Company Exhibit No. 4 for

Docket No. 86-702", and as provided in the Unit Agreement in

Exhibit C thereof.

3. The Unit Agreement is hereby approved and adopted in

accordance with Finding No. 8 hereof.

4. Celeron Oil and Gas Company is hereby designated Unit

Operator of the reservoirwide unit herein created.

5. The costs and expenses of unit operation shall be bome in

accordance with Finding No. 10 hereof.

A-8

6. Future wells within the boundaries of the unit created herein

which are completed in the Upper Tuscaloosa Sand, Reservoir A

may be located in accordance with Finding No. 11.

7. The allowable for the reservoirwide unit herein created shall

be granted and may be produced in accordance with Finding Nos. 11

and 12.

8. This order shall not vary or alter any of the terms of the Unit

Agreement nor impose any terms or operations upon the non-signers

of said Unit Agreement more onerous than the terms and operations

set out in said agreement.

9. All provisions of the Office of Conservation Order 1047

Series which are contrary to the provisions of this Order are

rescinded; however, except to the extent contrary herewith, all

pertinent provisions of the Office of Conservation Order 1047 Series

and all applicable Statewide Orders shall apply to the unit created

herein.

10. When there is additional geological and engineering

information which would indicate a required change or revision in

the unit boundaries as adopted herein or which would indicate a

required change or revision of other provisions of this order, the

party or parties in possession of such additional information shall

petition the Commissioner of Conservation for a public hearing for

the purpose of considering appropriate changes.

This Order shall be effective on and after December 11, 1986.

A-9

OFFICE OF CONSERVATION

OF THE STATE OF LOUISIANA

H W mpson

HERBERT W. THOMPSON

COMMISSIONER OF CONSERVATION

ML/Ic

Celeron Oil and Gas Company

Exhibit No. 4 for

Docket No. 86-702 -

Attached

A-10

APPENDIX C

THE SUPREME COURT

FOR THE STATE OF LOUISIANA

DOCKET NO. 88-C-1036

KAISER ALUMINUM EXPLORATION COMPANY, INC.,

ET AL

Plaintiffs-Respondents

versus

THE HONORABLE HERBERT W. THOMPSON,

COMMISSIONER OF CONSERVATION AND ASSISTANT

SECRETARY, OFFICE OF CONSERVATION

OF THE STATE OF LOUISIANA

Defendant-Applicant

CONSOLIDATED WITH:

CHEVRON U.S.A. INC.

Plaintiff-Respondent

versus

HERBERT W. THOMPSON, COMMISSIONER OF

CONSERVATION

Defendant-Applicant

A-11

PLAINTIFFS-RESPONDENTS' MOTION FOR

CERTIFICATE AS TO EXISTENCE OF A FEDERAL

QUESTION

Now come Plaintiffs-Respondents ]/ in this matter and move

this Court for the issuance of a Certificate As To Existence of a

Federal Question. In support of this motion, Plaintiffss-

Respondents show:

1.

Defendants-Applicants 2/ filed their Application for Wnit of

Certiorari on April 29, 1988. By Order dated May 20, of 1988, this

Court granted certiorari and summarily reversed the Court of Appeal,

First Circuit and reinstated the judgment of the district court. A copy

of the May 20, 1988 order is attached hereto as Exhibit A.

y a

Plaintiffs-Respondents filed their Application for Rehearing on

June 3, 1988, and their Supplemental Brief in Support of Application

for Rehearing on July 7, 1988. By order dated September 9, 1988,

this Court denied the Application for Rehearing.

)/ Plaintiffs-Respondents are Kaiser Aluminum Exploration Company, Park

Lane Enterprises, Inc., Expec Resources, Ltd., Acme Brick Company, Leighton

Ewell, Rose McMillan, Betty Craig, Dolese Concrete Company, Louisiana

National Bank as trustee for the Kirk E. Williams, Jr. Inter Vivos Trust and the

Bernadette S$. Williams, Inter Vivos Trust, and Chevron U.S.A. Inc.

2/ Defendants-Applicants are Herbert W. Thompson, former Commissioner

of Conservation of the State of Louisiana, J. Patrick Batchelor, current

Commissioner of Conservation of the State of Louisiana, Celeron Oil & Gas

Company, First Energy Corporation, Union Texas Petroleum, Terra Resources,

Inc., Borden, Inc., and TXO Production Corporation.

3.

Plaintiffs-Respondents have contended in the district court, the

Court of Appeal, First Circuit, and in this Court that the failure to

provide actual notice by mail of a hearing subsequently conducted by

the Commissioner of Conservation constituted a violation of Due

Process Clause of the Fourteenth Amendment of the United States

Constitution.

4.

Certain Plaintiffs-Respondents desire to present the issue of the

violation of the Due Process Clause of the Fourteenth Amendment of

the United States Constitution to the Supreme Court of the United

States for review.

3.

As a result of this Court's summary reversal of the Court of

Appeal, First Circuit, and the resulting absence of any indication

from the Court as to the bases of its summary reversal, Plaintiffs-

Respondents are left without a means to establish jurisdiction in the

United States Supreme Court.

6.

Specifically, among the errors relied upon by Defendants-

Appellants in their Application was the assertion that the Court of

Appeal should be reversed for failure to dismiss the appeals of

Leighton Ewell, Rose McMillan, Betty Craig, and Dolese Concrete

Company on the ground of mootness. If this Court did conclude that

the appeals of these Plaintiffs-Respondents were moot, than it

necessarily follows that this Court did not reach the Due Process

Clause violation issue as to these Plaintiffs-Respondents, which in

turn would have a direct bearing on the jurisdiction of the Supreme

Court of the United States.

¥

In addition, the absence of an opinion from this Court makes it

difficult for Plaintiffs-Respondents to represent to the Supreme

A-13

iia ieciain eee

Court of the United States that the federal Due Process Clause

argument was raised in this Court, and impossible to determine

whether this Court considered and rejected that argument. Both

issues may be critical to establishing jurisdiction in the Supreme

Court of the United States.

8.

Plaintiffs-Respondents have prepared and presented to this

Court a Certificate as to Existence of a Federal Question, wherein

this Court certifies as to the issues addressed above. Certificates of a

similar nature have been utilized by the United States Supreme Court

from time to time. See for example, Allenberg Cotton Company v.

Pittman, 419 U.S. 20, 95 S.CT. 260, 42 L.Ed.2d 195 (1974).

WHEREFORE, Plaintiffs-Respondents request that this Court,

through a designated Justice of this Court, execute the Certificate as

to Existence of a Federal Question if this Court finds the

representations contained therein accurate.

(s/ Robert L, Redfeam

ROBERT L. REDFEARN

JAMES A. BURTON

JOHN C. HERBERT

SIMON, PERAGINE, SMITH &

REDFEARN

30th Floor, Energy Centre

1100 Poydras Street

New Orleans, LA 70163

Telephone: (504) 569-2030

A-14

H. H. HILLYER, JR.

M. HAMPTON CARVER

M. TAYLOR DARDEN, T.A

SUSAN HOPKINS MEYERS

MILLING, BENSON, WOODWARD,

HILYER, PIERSON & MILLER

909 Poydras Street

Suite 2300

New Orleans, LA 70112

Telephone: (504) 569-7000

Attomeys for Plaintiffs-

Respondents

CERTIFICATE OF SERVICE

I hereby certify that a copy of the foregoing Plaintiffs’ Motion

tor Certificate as to Existence of a Federal Question has been served

on all counsel of record by depositing same in the United States

mail, postage prepaid and properly addressed this /s/Sth day of

December, 1988.

ls/ Judy Perry Martinez

A-15

THE SUPREME COURT

FOR THE STATE OF LOUISIANA

DOCKET NO. 88-C-1036

KAISER ALUMINUM EXPLORATION COMPANY, INC.; ET

AL

Plaintiffs-Respondents

versus

THE HONORABLE HERBERT W. THOMPSON,

COMMISSIONER OF CONSERVATION AND ASSISTANT

SECRETARY, OFFICE OF CONSERVATION OF THE STATE

OF LOUISIANA

Defendant-Applicant

CONSOLIDATED WITH:

CHEVRON U.S.A. INC.

Plaintiff-Respondent

versus

HERBERT W. THOMPSON, COMMISSIONER OF

CONSERVATION

Defendant-Applicant

A-16

CERTIFICATE AS TO

EXISTENCE OF A FEDERAL QUESTION

This Court, in matter No. 88-C-1036, Kaiser Aluminum

Exploration Company. Inc., et al. v. The Honorable Herbert W.

Thompson, Commissioner of Conservation, consolidated with

Chevron U.S.A. Inc. v. The Honorable Herbert W. Thompson,

hereby certifies, upon motion of Plaintiffs-Respondents, that: (1) the

applicants in their Application for Writ of Certiorari insisted that the

Court of Appeal, First Circuit, erred in not dismissing Leighton

Ewell, Rosa McMillan, Betty Craig, and Dolese Concrete

Company's appeal on grounds of mootness; and, (2) this Court in

reversing the Court of Appeal and reinstating the judgment of the

district court did not base its decision on a finding that the |

aforementioned appeals to the Court of Appeal were moot.

This Court further certifies that: (a) Plaintiffs in their Application

for Rehearing and Supplemental Brief in Support of Application for

Rehearing argued that the failure to provide actual notice by mail of a

hearing conducted by the Commissioner of Conservation violates the

Due Process Clause of the Fourteenth Amendment of the United

States Constitution; (2) in its deliberation of this case, this Court

considered this question of whether the failure to provide actual

notice by mail of a hearing conducted by the Commissioner of

Conservation violated the Due Process Clause of the Fourteenth

Amendment of the United States Constitution; and, (3) it was the

judgment of this Court that the failure to provide actual notice by mail

of a hearing to be conducted by the Commissioner of Conservation

did not violate the Due Process Clause of the Fourteenth Amendment

of the United States Constitution. ;

New Orleans, Louisiana, this___ day of , 1988.

A-17

SUPREME COURT OF LOUISIANA

JUSTICE

A-18

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.

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