Ken Cuccinelli backs lawyer in gas royalties dispute

A state lawyer who a federal judge said went too far helping gas companies in a wrangle over royalties did nothing wrong, even when advising in a case in which the state was not a party, the Virginia attorney general's office says.

State lawyer Sharon Pigeon's email advice to the gas companies, including how to take advantage of a paperwork processing glitch to keep one Virginia landowner's case out of court, was meant to help the Virginia Gas and Oil Board distribute royalties more quickly, spokesman Brian Gottstein said Wednesday.

Pigeon also advised a subsidiary of Consol Energy that it would help its case if it could calculate how much one plaintiff had received in royalty payments. Court records also indicate that she consulted with another gas company on a jury pool and did work in a related case, but one in which the state was not a party. Consol Energy gave more than $111,000 to the gubernatorial campaign of Pigeon's boss, Attorney General Ken Cuccinelli.

"The attorney general said the tone of the emails was a bit overzealous, not their substance - not the information she shared," Gottstein said.

"While the tone of Ms. Pigeon's emails may have come across as a bit overzealous regarding an issue other than the constitutionality of the Virginia Gas and Oil Act ... there was nothing wrong with her sharing the information she did in her emails with the companies," he said.

The state had intervened in some of the royalty cases in what its filings say was intended to be a limited way in order to defend the validity of the Gas and Oil Act.

"Ms. Pigeon was simply trying to make the point in those emails that if the case were turned into a class action, contrary to what many people think, that still wouldn't resolve the individual gas ownership issues that are the real obstacle to getting the royalties released," Gottstein said.

He said class action lawsuits can take years to resolve and wouldn't affect the Gas and Oil Board's disbursement of royalties from escrow accounts.

The board can release funds only when disputes between property owners over rights to gas are settled. The lawsuits against the gas companies allege they did not pay the proper amounts into the escrow funds, and do not involve disputes between landowners over gas rights.

Cuccinelli was briefed on the dispute by senior staff lawyers, though Pigeon was not in any of those sessions, Gottstein has said.

The attorney general had tried in 2011 to speed royalty payments with legislation that would have: set a formula for distributing pooled royalties; declared that mineral rights revert to the surface landowner if the rights are unused for 35 years; and set up a hearing officer program to allow the Gas and Oil Board to order payment of royalties.

Gottstein said Cuccinelli had thought state Sen. Phillip Puckett, D-Russell County, would carry that bill, but he did not.

Puckett has called for an investigation into Cuccinelli's role in the lawsuits, and several Democrats have said his office should not be helping the gas companies fend off claims from Virginia landowners.

"Consol Energy has been very helpful to Ken Cuccinelli's campaigns, and so far his office has been very helpful to their subsidiary and another company as they seek to avoid paying Virginians mining royalties," said Democratic Party spokesman Brian Coy.

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