Buccaneer Energy (USA) Inc. v. Gunnison Energy Corporation et al
ORDER Denying 21 Motion to Dismiss filed by SGI and the Third Claim for Relief is dismissed, by Judge Richard P. Matsch on 12/14/2012.(rpmcd )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Senior District Judge Richard P. Matsch
Civil Action No. 12-cv-01618-RPM
BUCCANEER ENERGY (USA) INC.,
GUNNISON ENERGY CORPORATION;
SG INTERESTS, I, LTD., and
SG INTERESTS VII, LTD.,
ORDER DENYING MOTION TO DISMISS
In the First and Second Claims for Relief in the Complaint, filed on June 21,
2012, the plaintiff, Buccaneer Energy (USA), Inc., (“Buccaneer”) asserts that the
defendants, Gunnison Energy Corporation (“GEC”), SG Interests I, Ltd., and SG
Interests VII, Ltd., (collectively “SGI”) have violated Sections 1 and 2 of the Sherman
Act, 15 U.S.C. § 1, 2, by restraining access to the pipelines they own and control in the
Ragged Mountain Area of Colorado with intent to drive out competition in the
production, gathering, processing, transportation and sale of natural gas, produced from
Among the factual allegations to support those claims, Buccaneer alleges that a
natural gas producing company, Riviera Drilling & Exploration Company (“Riviera”) sold
natural gas to GEC, the operator of the pipeline system, co-owned by SGI, pursuant to
a short-term terminable agreement which GEC terminated, effective October 1, 2007.
Buccaneer’s president, Tony Gale, had earlier inquired of GEC whether there was any
problem with Buccaneer’s purchase of Riviera’s assets. After receiving assurances that
GEC would transport gas produced from Riviera’s leaseholds, Buccaneer negotiated a
Lease and Purchase Agreement with Riviera for all of its assets, effective March 4,
In the Fall of 2007, GEC increased the transportation charge and the conditions
for accepting Riviera’s gas.
Buccaneer alleges that after the sale agreement with Riviera, GEC made
unreasonable demands for transporting gas from the Riviera leases, including
conveyance of a 30% working interest in its properties to GEC and a higher price,
making performance of sale of assets impossible. The complaint recites multiple
barriers to entry into the market for production and sale of natural gas from this
geographical area into interstate commerce.
SGI filed a motion to dismiss the complaint on September 24, 2012 (Doc. 21).
GEC filed an answer and a motion to dismiss the Third Claim for Relief, claiming
tortious interference with prospective business advantage or relation under Colorado
law, on September 24, 2012. (Docs. 22 and 23). The plaintiff withdrew the Third Claim
for Relief on October 15, 2012.
The SGI motion to dismiss the First and Second Claims has been fully briefed. It
asserts that these claims are precluded by the doctrine of res judicata because a prior
action filed by Riviera, Riviera Drilling & Exploration v. Gunnison Energy Corp., No. 08cv-02486-REB-CBS, was dismissed with prejudice. That dismissal was ordered after
withdrawal of counsel shortly before a scheduled trial and Riviera’s inability to retain
new counsel and pay the costs of litigation. The dismissal was not an adjudication on
the merits of the case. There has never been a full and fair opportunity to litigate the
claims made by Riviera which had survived summary judgment. It was done with
prejudice to bar Riviera from filing another case. The claim that there is privity between
Riviera and Buccaneer fails. This is not a case about Riviera’s leasehold interests. It is
about these two defendants’ efforts to preclude entry into the market to preserve
For the same reason, the assertions of failure to seek administrative remedies
has no merit. While the price and conditions for transportation of gas through the
pipelines might be challenged administratively, the thrust of this complaint is the use of
the control of that system to foreclose competition in the exploration for and production
of natural gas from the Ragged Mountain Area.
The allegations of the complaint are sufficient to proceed with this litigation.
Accordingly, it is
ORDERED, that the motion to dismiss filed by SGI (Doc. 21) is denied, and it is
FURTHER ORDERED that the Third Claim for Relief is dismissed.
DATED: December 14th, 2012
BY THE COURT:
s/Richard P. Matsch
Richard P. Matsch, Senior Judge
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