## Facts

- Multiple parties, including the plaintiffs and Dyco Petroleum Corporation (Dyco), owned working interests in a natural gas well in Roger Mills County, Oklahoma.
- Dyco entered into gas-purchase arrangements with El Paso Natural Gas Company and Panhandle Eastern Pipe Line Company (Panhandle) for sales of production from the well.
- Panhandle purchased gas under a contract with Dyco; the plaintiffs were not parties to that agreement.
- The plaintiffs sued Dyco, El Paso, and Panhandle seeking monetary relief tied to gas production proceeds.
- Against Panhandle, the plaintiffs alleged (1) conversion for taking and paying for all gas as if Dyco owned it, (2) violation of Oklahoma statutes purportedly requiring ratable purchasing from each working-interest owner, and (3) violation of statutes they asserted allowed ratification of gas-sale agreements and required proportionate payment.
- The trial court granted summary judgment to Panhandle and dismissed it, reasoning the claims were federally preempted and the court lacked subject-matter jurisdiction.
- The plaintiffs appealed only the dismissal of Panhandle.

## Issues

1. Whether a purchaser commits common-law conversion by buying all production from one working-interest cotenant when other cotenants claim unpaid shares.
2. Whether the cited Oklahoma “ratable take” and conservation statutes impose a duty on a purchaser to buy gas pro rata from each working-interest owner in a single well, supporting a private damages claim.
3. Whether any claim under Oklahoma statutes concerning ratification/payment for gas sales was preserved and supported on appeal as a basis for relief against the purchaser.
4. Whether federal preemption needed to be decided to affirm dismissal of the purchaser.

## Decision

- The Supreme Court of Oklahoma affirmed dismissal of all claims against Panhandle.
- The court affirmed on state-law grounds and did not decide federal preemption.
- The court held no conversion claim lay against Panhandle because sale by a cotenant does not constitute conversion against other cotenants.
- The court held the cited Oklahoma statutes did not require Panhandle to purchase ratably from each working-interest owner in a single well.
- The court held any claim under the ratification/payment statutes was waived on appeal due to failure to present supporting argument and authority.

## Legal Principles

- A working-interest cotenant may produce and sell oil or gas without committing conversion against other cotenants; the non-selling cotenant’s remedy is generally an accounting or share of proceeds, not tort conversion against the purchaser.
- Oklahoma conservation and proration provisions cited by the plaintiffs do not create a private statutory duty requiring a purchaser to buy from each working-interest owner in a single well in proportion to ownership.
- Appellate courts will treat a theory as abandoned when the appellant fails to support it with argument and authority in briefing.
- Courts may avoid deciding constitutional or Supremacy Clause questions when the case is resolved on non-constitutional state-law grounds.

## Conclusion

The court upheld Panhandle’s dismissal because Oklahoma law supplied no viable conversion or statutory “ratable purchase” claim against a purchaser buying from a cotenant, and any separate statutory ratification/payment theory was not adequately pursued on appeal, making it unnecessary to reach federal preemption.


Anderson v. Dyco Petroleum Corp., 782 P.2d 1367 (Okla. 1989)