Based upon a recent court request, Soutwest Energy (SWN) is expected to drop its ongoing lawsuit for a reduction in assessment rates in Cleburne and surrounding counties. By dropping the lawsuit, the county is expected to received assessment payments in the millions of dollars.
The lawsuit, actually a series of lawsuits filed since 2016, one for each year, assert that SWN was being charged an unfairly high assessment rate. The company, at the time one of the largest operators in the Fayetteville Shale natural gas extraction industry, withheld payment of assessments pending the outcome of its litigation from 2016 and on.
In 2016 SWN made a partial payment on the non-disputed amount (that amount it considered an appropriate assessment rate), but this was changed to zero-payment pending litigation outcome with the 2017 filing.
In this most recent development, as preparations were being made for a court hearing on the matter in nearby Van Buren County, attorneys representing SWN advised the court that SWN was preparing to ask for the case to be dismissed, according to Attorney Eddie Morgan, whose firm is representing Van Buren County in this matter.
The most recent date on case activity on the Van Buren County filing is Oct. 22, according to online court records.
The anticipated motion to dismiss comes on the heels of Flywheel Energy’s payment to Cleburne County for its 2018 assessment earlier this month. Flywheel had purchased SWN in a deal which was completed earlier this year. As the purchase was pending, Flywheel was named as a party in the 2018 suit by SWN at the time of its filing.
Flywheel’s payment, in full, for that single year and without disputing the assessment amount, totaling over $2.5 million, Cleburne County Collector Connie Caldwell said.
With SWN’s expected motion to dismiss, the county would be receiving several million dollars, reflecting several years of assessment payments. The monies primary impact would be on county schools, which benefit from the assessment revenue.
Morgan said that when once the dismissal motion was approved, SWN would have 30 days to makes its payment to the county before it would be assessed penalties and interest.
While the specific amount of money was not annunciated, it should be several times more than Flywheel’s earlier payment.
Morgan said while not able to give a specific date, he expected the SWN motion to dismiss and payment to Van Buren County to be made by the end of the year.
As this is a new development in the ongoing assessment litigation, the county judge’s office was not willing to give a statement pending its review.