History
  • No items yet
midpage
571 S.W.3d 905
Ark.
2019
Read the full case

Background

  • Stephens Production Company held leases on the Barton Production Unit in Franklin County and suspended royalty payments to lessors, prompting an August 2015 suit by royalty owners asserting breach of contract and related claims.
  • Appellees moved in March 2018 to certify a class defined as all current or former royalty owners in wells producing from the Barton Production Unit whose leases contained a specified one-eighth (or applicable) royalty clause, excluding governments, certain counsel, and judges/staff.
  • Appellees alleged more than 36 potential class members and argued joinder was impractical and a class action was the superior, efficient method to resolve common legal/factual issues arising from Stephens’s suspension of royalties.
  • Stephens opposed certification, arguing numerosity was not met (class too small) and that a class action was not superior because many potential members had not joined despite years to do so and individual suits would be feasible.
  • The trial court granted class certification; Stephens appealed. The majority affirmed, finding no abuse of discretion on numerosity and that superiority was satisfied. A three-justice dissent would have reversed on numerosity.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Numerosity (Rule 23(a)) Class exceeds 36 members; joinder impractical due to number and dispersion Class is too small (pointing to cases with smaller classes); joinder practicable Affirmed: trial court did not abuse discretion; 36+ supports numerosity and close calls favor certification (with option to decertify later)
Superiority (Rule 23(b)) Class action is more efficient and fair because common lease language and alleged uniform conduct make joint liability determination appropriate Class is not superior because class is small, many potential members failed to join, and individual suits would be feasible Affirmed: class action is the superior, fair, and efficient means to resolve common liability issues; individual trials can follow for individual issues if needed
Administrative feasibility / class definition Proposed class is precisely defined by lease language and exclusions; records could identify members (Implicit) Concern about final member count and feasibility of identifying members Implicitly sustained: court noted counsel was still finalizing records but found description sufficiently definite for certification

Key Cases Cited

  • Diamante, LLC v. Dye, 430 S.W.3d 710 (Ark. 2013) (lists Rule 23 requirements)
  • Cheqnet Systems, Inc. v. Montgomery, 911 S.W.2d 956 (Ark. 1995) (class size and identity need not be exact; numerosity may be supported by common sense)
  • Fraley v. Williams Ford Tractor & Equip. Co., 5 S.W.3d 423 (Ark. 1999) (close numerosity questions favor certification given option to decertify)
  • ChartOne, Inc. v. Raglon, 283 S.W.3d 576 (Ark. 2008) (abuse-of-discretion standard for class-certification review; do not reach merits)
  • Van Buren Sch. Dist. v. Jones, 232 S.W.3d 444 (Ark. 2006) (class definition must be administratively feasible)
  • North Little Rock v. Vogelgesang, 619 S.W.2d 652 (Ark. 1981) (17-member class held insufficient for numerosity)
Read the full case

Case Details

Case Name: Stephens Prod. Co. v. Mainer
Court Name: Supreme Court of Arkansas
Date Published: Apr 18, 2019
Citations: 571 S.W.3d 905; 2019 Ark. 118; No.: CV-18-931
Docket Number: No.: CV-18-931
Court Abbreviation: Ark.
Log In
    Stephens Prod. Co. v. Mainer, 571 S.W.3d 905