The mineral-rights leasing boom in the Barnett Shale produced its first potential class-action lawsuit Tuesday when a Fort Worth lawyer sued Leonard Briscoe Sr. and his company, Glencrest Resources, over hundreds of promised lease bonuses that allegedly have never been paid.
Attorney John Hart said he will seek class-action status on the grounds that as many as 2,500 landowners may be involved in the dispute, which extends over nearly a year. According to the suit, Briscoe and Glencrest told plaintiff Pamela Ellis, a Fort Worth resident, and other homeowners at a Dec. 5 meeting that they would be paid a signing bonus within 30 to 45 days of agreeing to the lease. Despite numerous telephone calls to Glencrest, "to date, defendants have not paid plaintiff the promised bonus," according to the suit.
Briscoe, a Fort Worth developer, could not be reached Tuesday for comment. Calls over two days to Glencrest Resources went unanswered, and Briscoe's personal phone number would not accept additional voice messages.
In May, the Star-Telegram reported that a number of landowners in Mansfield, Forest Hill and Fort Worth complained that they had not received bonus payments from Glencrest. At the time, Briscoe said he was raising money to finance Glencrest, a startup company, and expected to have the money by June. In July, Briscoe told the newspaper that he still hoped to raise $60 million and was hiring a drilling consultant.
Samuel Solis of Forest Hill, who said he signed a lease with Glencrest in January, said he was glad to hear of the suit. "I sent letters. They were never answered," Solis said Tuesday. "I'm glad they filed the suit. I want to join that."
Grace Winston of Mansfield signed a lease with Glencrest in November and was also willing to join a lawsuit. "I've waited a long time," she said. She said she hasn't tried to lease her property to another drilling company because "I didn't know if I could."
Hart said a mineral-rights lease is a legal document that can't simply be dismissed. A property owner might be tempted to ignore the lease, "but the legitimate oil companies are concerned about it and are staying away" from Glencrest leases, he said. He said he has seen a few property owners sign a second lease, called a top lease, with another driller, who would gain the lease if the original lease were terminated. But that is an unusual situation, he said.
Glencrest Resources has filed 100 mineral-rights leases with Tarrant County, according to records. In addition, Briscoe has said he filed a memorandum of lease with hundreds of additional names. In all, he has said, Glencrest has signed about 3,000 leases.
Tougher Texas law
Hart said he is seeking to rescind, or cancel, those leases for lack of payment of the promised bonus. Although Texas has made it harder in recent years to file class-action suits, "We think this is the sort of circumstance contemplated by the rules," he said. Class-action suits can take years to conclude, but Hart said he intends to press for a hearing by early December.
Mineral-rights expert John Baen of the University of North Texas said that given the money at stake in the Barnett Shale, "I am just amazed how few lawsuits there have been. The record is really pretty good." He said a class-action lawsuit is probably an appropriate way to try to resolve the Glencrest leases.
TO JOIN THE SUIT
Homeowners who signed leases with Glencrest Resources may be eligible to join a lawsuit seeking to throw out the leases. Contact John Hart at [email protected] or 817-870-2102.