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Judge dismisses most of Preston gas lease lawsuit

MORGANTOWN, W.Va. -- More than half of the counts and more than a dozen defendants in a West Virginia oil and gas lease lawsuit have been dismissed.

The lawsuit combines 68 cases filed by 121 mineral owners in Preston County who allege that Traverse City, Mich.-based Magnum Land Services and Belmont Resources LLC fraudulently persuaded them to sign gas leases below their true value.

Defendants also include Canada-based Enerplus Resources and 19 employees of Magnum and Belmont. The lawsuit said the leases were transferred in 2010 to Enerplus. The company was excluded from two counts associated with notarizing the leases.

The companies have denied the allegations.

U.S. District Judge Irene Keeley dismissed the 19 employees from the lawsuit, saying in two separate orders that they weren't served papers in a timely manner, The Dominion Post reported Monday.

Keeley also dismissed five of the lawsuit's nine counts, including slander of title, one fraud count, leases void because of disqualifying interest, misconduct of notary public against Magnum and Belmont, and tort of outrage, which means inducing the plaintiffs to sign lowball leases was unconscionable.

Part of a conspiracy count relating to the employees also was dismissed. A portion of the count alleging conspiracy between Magnum and Belmont was retained.

The other remaining counts include fraud in the inducement of the leases, unconscionability relative to plaintiffs' inadequacy in bargaining power, and declaratory relief to nullify and renegotiate the leases.

The case originally was filed in Preston County Circuit Court in November 2012 and was transferred to federal court in February. The residents are demanding unspecified compensatory and punitive damages.

A trial is set for Oct. 27, 2014.


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