DISTRlCT,··~6,:~,·.;:-:;--· i… · oftheir royalty instruments or Kansas law. Anadarko's...

FLEES ON GOOING COULSON amp KITCH LLc 125 North Market Suite 1600 Wichita Kansas 67202 Telephone (316) 267-7361 Cy

IN THE TVENTY -SIXTH JUDICIAL DISTRlCTmiddotmiddot~6~middot---middotshyDISTRlCTCOURT STEVENS COUNTY KANSAS

GILBERT H COULTER and ) ELIZABETH S LEIGHNOR ) individually and as representative ) plaintiffs on behalf ofpersons or ) companies similarly situated )

) Plaintiffs ) Case No 98-CV-40

vs ) )

ANADARKO PETROLElJ1vI CORPORATION ) )

Defendant )

MEMORANDUM IN SUPPORT OF MOTION FOR LEAVE TO ASSERT CLAIM FOR PUNITIVE DAMAGES

COME NOW the plaintiffs and plaintiff class (plaintiffs) and in support oftheir motion

for leave to assert a claim for punitive damages state as follows

I INTRODUCTION

Plaintiffs acknowledge that under Kansas law a mere breach ofcontract even ifintentional

and unjustified does not warrant punitive damages but such damages are allowable ifthere is some

independent tort present U Farrell v General Motors Corporation 249 Kan 231 247 815 P2d

538 (1991) Equitable Life Leasing Corp v Abbick 243 Kan 513516 757 P2d 304 (1988)

Here because Anadarko reduced royalty payments in furtherance of its own interest and

failed to disclose such reductions thereby concealing them and misleading its royalty owners it

committed torts which were separate and independent from the breach of contract also alleged

-1shy

hereinl thereby giving rise to a claim for punitive damages

From the outset of this lawsuit plaintiffs have asserted claims for breach of fiduciary duty

and constructive fraud against Anadarko Petroleum Corporation (Anadarko) as the result ofits

failure to fully disclose the manner in which it calculates their royalty payments (Petitionat p 5

1M Defendant has breached its fiduciary duty by reducing royalty payments to members of the

plaintiff class and by failing to disclose such reductions By such conduct defendant has engaged

in constructive fraud) Plaintiffs now seek leave ofcourt pursuant to KSA 1999 Supp 60-3703

to pursue punitive damages in connection with those claims

Anadarkos hTItten information accompanying its royalty checks concealed material facts

Specifically it omitted all reference to the following

(1) the value which it was ( and is) using to calculate royalties is not the result

of an actual arms -length sale but is instead based upon a sampling ofprices which

included transactions to which Anadarko was not even party (commonly referred to

as an index price)

(2) From the amount based on that artificial value Anadarko deducts from royalty

payments expenses incurred for services performed between the wellh~d and the point at

which the gas enters the transmission pipeline

(3) Anadarko was not (and is not) basing the royalty payment on the amount

which it actually receives for the gas which often exceeds the index price

(4) Anadarko was (and is) relying on a transaction between itself and its

wholly-owned subsidiary Anadarko Energy Services Company whereby the former

lPlaintiffs claim for breach ofcontract is separate from and in no way dependent upon the independent tort claims for constructive fraud and breach of fiduciary duty

-2shy

allegedly transferred title to the gas at the wellhead to the latter at the price fixed

pursuant to the formula described in paragraph I above to calculate such royalty

payments

(5) the alleged sale from Anadarko Petroleum to Anadarko Energy was not

(and is not) an arms -length transaction and had (and continues to have) the effect of

(a) depriving the royalty owners oftheir share ofthe full value ofthe gas represented

by the difference between the index price and the actual proceeds ofsale received for

the gas and (b) imposing a I18th share of costs associated with producing and

marketing the gas on its royalty owners and

(6) the costs associated with producing and marketing the gas were incurred

through a non-arms -length transaction with yet another subsidiary of Anadarko

Petroleum knOvn as Anadarko Gathering Company whereby Anadarko Gathering

Company performed services necessary to discharge Anadarko Petroleums duties

to produce and market the gas

(See Affidavit ofGregory J Stucky Appendix I hereto) In addition Anadarko failed to disclose

that Anadarko Energy and Anadarko Gathering Company did not possess (and never have p~Jsessed)

the essential elements of an independent entity and were in fact the alter egos of Anadarko

Petroleum (See Affidavit ofGregory J Stucky Appendix 1 and Affidavit ofGerald H Graham

PhD Appendix 2 hereto)

Part and parcel of the above fraudulent conduct was Anadarkos intent to interpose the

existence ofits sham wellhead sales contract with Anadarko Energy as a defense to any claim by its

royalty owners that such deductions were improper In other words Anadarkos primary if not

sole reason for selling the gas to its alter ego at the wellhead was to create the impression that it was

-3shy

receiving exactly the same price for the gas as its royalty owners when in fact it was receiving a

higher price through the sales of such gas made by its subsidiary Similarly by hiding the

deductions in the sales price which it fixed for the gas at the wellhead Anadarko was secretly

imposing an expense on its royalty owners which they were not obligated to bear under the terms

of their royalty instruments or Kansas law

Anadarkos fraudulent conduct continues even in this litigation It now asserts that its sale

ofgas to its subsidiary at the wellhead provides a complete defense to the claim that the price used

for royalty calculations is too low and that the deductions are improper As evidenced by its expert

reports Anadarko relies on such sales in support of its contentions that the gas is in marketable

condition at the wellhead and that such price is properly reduced by the costs that are the subject of

this suit By invoking its alter ego to create and pursue this defense Anadarko has further

aggravated its breach of fiduciary duty and constructive fraud

Thus Anadarkos breach of fiduciary duty and constructive fraud have been compounded

by its fraudulent abuse of the corporate form which served to facilitate and conceal Anadarkos

breaches of its duties to the plaintiff royalty owners

II THE ELEMENTS OF BREACH OF FIDUCIARY DUTY ARE PRESENT HERE

Although Kansas law does not impose a fiduciary relationship between lessor and lessee

under an oil and gas lease with respect to the lessees operations see Waechter v Amoco Production

Company 217 Kan 489 537 P2d 228 (1975) at least one aspect ofthe producer-royalty owner

relationship does give rise to a fiduciary obligation the producers handling ofmoneys belonging

to the lessor-royalty owner and its reporting of the results of its operations

In Lindholm v Nelson 125 Kan 223 Syl 3 264 P 50 (1928) the Court held

-4shy

A fiduciary relation does not depend upon some technical relation created by or defmed in law It may exist under a variety ofcircumstances and does exist in cases where there has been a special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to the interests of the one reposing the confidence

With respect to the calculation and payment ofroyalties the lessor-royalty owner is fully dependent

upon the lessee-producer to faithfully collect handle report and pay over funds received on behalf

of the royalty owner in connection with sales of oil or gas pursuant to an oil and gas lease

One is said to act in a fiduciary capacity or to receive money or contract a debt in a fiduciary capacity when the business which he transacts or the money or property which he handles is not his own or for his own benefit but for the benefit ofanother person as to whom he stands in a relation implying and necessitating great confidence and trust on the one part and a high degree of good faith on the other part Blacks Law Dictionary 753 (4th ed rev 1968)

Inre Marcotte 243 Kan 190197-198756 P2d 1091 (1 988)(quoting with approval)

When the lessee producer receives money from the sale of oil or gas produced from a

leasehold such funds necessarily include money for the benefit ofthe royalty owner The lessor-

royalty owner must therefore necessarily place his confidence and trust in the lessee and rely upon

it to properly calculate and pay royalty By virtue of this trust and confidence the lessee-producer

has a fiduciary obligation to report fully fairly and accurately the results of its operations and the

manner in which royalty payments are calculated including any reductions or adjustments from the

actual sales price received2

Where as here the lessee fails to faithfully account or fails to fully and accurately disclose

the facts regarding such matters the lessee has breached its fiduciary duty to the royalty owner

2It is only by receiving such infonnation from the lessee that the lessor can assess whether the lessee has performed its duties under the lease

-5shy

Ill THE ELEMENTS OF CONSTRUCTIVE FRAUD ARE ALSO PRESENT

Actual fraud is an intentional fraud and the intent to deceive is an essential element of the

action Constructive fraud however is a breach of a legal or equitable duty which irrespective of

moral guilt the law declares fraudulent because of its tendency to deceive others or violate a

confidence and neither actual dishonesty of purpose or intent to deceive is necessary Moore v

State Bank of Burden 240 Kan 382389 729 P2d 1205 (1986) cert denied 482 US 906 107

SCt 2484 96 LEd2d 376 (1987)(citing Andres v Claassen 238 Kan 732 Syl 2714 P2d 963

[1986]) Stated another way [c]onstructive fraud means any act of omission or commission

contrary to legal or equitable duty trust or confidence justly reposed which is contrary to good

conscience and operates to the injury of another Dillon Stores v Board of Sedgwick Countv

Commissioners 259 Kan 295 SyL 4912 P2d 170 (1996)

Moreover Kansas law has long recognized that once a party undertakes to disclose

information it cannot withhold information but must make full and complete disclosure in order to

avoid misleading others

Telling half a truth has been declared to be equivalent to concealing the other half Even though one is under no obligation to speak as to a matter ifhe undertakes to do so either voluntarily or in response to inquiries he is bound not only to state truly what he tells but also not to suppress or conceal any facts within his knowledge which will materially qualify those stated Ifhe speaks at all he must make a full and fair disclosure Therefore ifone wilfully conceals and suppresses such facts and thereby leads the other party to believe that the matters to which the statements made relate are different from what they actually are he is guilty of a fraudulent concealment

Sparks v Guaranty State Bank 182 Kan 165 168318 P2d 1062 (1957)(quotingwith approval 23

AmJur Fraud and Deceit sect83 now 37 Am Jur 2dFraud and Deceit sect151 [1968])Cemphasis added)

The elements of constructive fraud are plainly evident here By disclosing on its royalty

remittance statements only the price of its sham sale of gas while withholding vital information

-6shy

regarding its calculation of royalty payments including its use of artificial index prices and

transactions with its wholly-owned subsidiaries Anadarko misled the plaintiffs and created a series

ofobstructions and obstacles that concealed (and facilitated) Anadarko s breaches ofits contractual

duties and required substantial burden and expense (including litigation) on the part ofplaintiffs in

order to discover the true state of affairs

IV ANADARKOS FRAUDULENT ABUSE OF THE CORPORATE FORM ALSO WEIGHS IN FAVOR OF PUNITIVE DAMAGES

The propriety of punitive damages is in this case is furtherdemonstrated by Anadarkos

fraudulent misuse ofits corporate structure which warrants the piercing ofthe corporate veil under

the alter ego doctrine Kansas has long recognized the use ofthe alter ego doctrine to disregard the

separate existence of a corporation and its related entities or individuals in cases of fraud or other

injustice Continental amp Commercial Trust amp Savings Bankv Garden Citv Co 123 Kan 659 SyL

~2 256 P 983 (1927)([i]n the absence of fraud or other invidious and vitiating circumstances

corporate veil will not be pierced) Kansas Supreme Court decisions have always been liberal in

indicating a tendency to disregard the theory of a corporation as an entity separate from its

corporators where justice between the real parties to the transaction requires it International

Union United Auto Etc v Cardwell Mfg Co 416 F Supp 1267 1286 (D Kan 1976)

Typically the alter ego doctrine is used as a form of vicarious liability to hold individual

officers directors or stockholders individually responsible for acts done in the name ofcorporations

See Doughty v CSX Transportation Inc 258 Kan 493 500905 P 2d 106 (1995) The conc~pt

of piercing the veil is to permit an injured party to get past the corporate shield in certain

circumstances Pemco Inc v Kansas Dept ofRevenue 258 Kan 717 723 907 P2d 863 (1995)

-7shy

In such circumstances the court pierces the corporate veil to disregard the fictional separation

between the entities in order to prevent the fraud or injustice that would otherwise result if the

plaintiffwere left with an uncollectible judgment against the first corporation

Here in a slightly different context piercing the corporate veil is necessary to prevent the

fraud and inj ustice to the plaintiffs that would othernise result ifAnadarko could successfully invoke

the sham transactions with its alter ego subsidiaries to avoid substantive liability (See Plaintiffs

Motion to Amend Pleadings pending herein) Plaintiffs claims for actual damages are in no way

dependent upon them piercing Anadarkos corporate veil IfAnadarkos defense were otherwise

valid plaintiffs would be defrauded by Anadarkos use ofits affiliate transactions to avoid sharing

a benefit (the incremental price increase on the actual sale of the gas to third parties) with the

plaintiffs and to impose a butden (the expenses at issue in this lawsuit) upon them

The fiction of separate corporate identities of two corporations will not be extended to

permit one ofthe corporations to evade its just obligations to promote fraud illegality or injustice

or to defend crime Dean Operations Inc v One Seventy Associates 257 Kan 676 681 896 P 2d

1012 (1995)

Kansas courts have approved the use ofthe following ten factors in determining whether the

alter ego doctrine applies

(1) whether the parentcorporation owns all or a majority of the capital stock ofthe

3Even if Anadarkos transactions with its affiliates were legitimate plaintiffs claims for actual damages would still be viable That is because Anadarkos attenuated argument is fundamentally legally defective It first posits the faulty legal premise that by arranging the sale of gas at the wellhead a producer necessarily satisfies its obligation to produce and market the gas irrespective ofwhat must be done with the gas beyond the wellhead Anadarko must carry that argument one step further by claiming that its sham transaction with its affiliate satisfies its obligations Plaintiffs have invoked the alter ego doctrine in order to easily dispense with Anadarkos argument based on that sham transaction

-8shy

subsidiary (2) whether the corporations have common directors or officers (3) whether the parent corporation finances the subsidiary (4) whether the parent corporation subscribed to an ofthe capital stock ofthe subsidiary or otherwise causes its incorporation (5) whether the subsidiary has grossly inadequate capital (6) whether the parent corporation pays the salaries or expenses or losses of the subsidiary (7) whether the subsidiary has substantially no business except with the parent corporation orno assets except those conveyed to it by the parent corporation (8) whether in the papers of the parent corporation and in the statements of its officers the subsidiary is referred to as such or as a department or division (9) whether the directors or executives ofthe subsidiary do not act independently in the interest of the subsidiary but take direction from the parent corporation and (10) whether the formal legal requirements ofthe subsidiary as a separate and independent corporation are not observed

Dean 257 Kan at 682 Service Iron Foundry Inc v MA Bell Co 2 Kan App 2d 662588 Pold

463 (1978) Hoffinan v United Telecommunications Inc 575 FSupp 1463 (D Kan1983) All

ten factors need not be present Cardwell 416 F Supp at 1286 and no single factor is necessarily

conclusive in determining whether to apply the alter ego doctrine Doughty 258 Kan at 504

In connection with these ten factors the court must also determine whether allowing the legal

fiction of the separateness of the corporate structures results in fraud or injustice Dean 257 Kan

at 687 Schmid v Roehm GmbH 544 F Supp 272 276-77 (D Kan 1982)

In the case at bar the existence of the ten factors is amply demonstrated in the attached

affidavit of Prof Gerald H Graham The existence of fraud and injustice if Anadarko were

permitted to hide behind its sham transactions with its alter ego subsidiaries is manifest That fraud

also weighs in favor of an award ofpunitive damages in this case

-9shy

V VICTIMS OF FRAUD AND BREACH OF FIDUCIARY DUTY ARE ENTITLED TO SUE FOR PUNITIVE DAMAGES

Punitive damages may be awarded whenever the elements of fraud malice gross

negligence or oppression mingle in the controversy Wooderson v Ortho Pharmaceutical Corp

235 Kan 387 Syi ~ 16 681 P 2d 1038 (1984) Thus courts have frequently held that where fraud

is shown punitive damages may be awarded Eg York v Intrust Bank NA 265 Kan 271 962

P2d405 (1998) Tetuan v AHRobbins 241 Kan441 738P2d 1210 (1987) Purcell v Automatic

Gas Distributors 673 P2d 1246 (Mont 1983)(constructive fraud) Bassett v Bassett 798 P2d 160

(NM 1990)(same) Logan v Barge 568 SW2d 863 (Tex Civ App 1978)(same) Moreover

U[p]unitive damages as well as actual damages are proper where a breach of a fiduciary duty is

involved Newton v Hornblower Inc 224 Kan 506 Syl ~ 13582 P2d 1136 (1978)

Punitive damages are appropriate here Plaintiffs should be permitted to pursue such a claim

CONCLUSION

The basis for plaintiffs claim for punitive damages is clear As the attached affidavits and

the facts and authorities discussed above indicate the assertion of a claim for punitive damages is

appropriate Moreover plaintiffs have a substantial likelihood of succeeding on such claim

Plaintiffs motion for leave to assert a claim for punitive damages should be granted

-10shy

Respectfully submitted

FLEESON GOOING COULSON amp KITCH LLC

By f2--r~Thomas D Kitch507034 Gregory J Stucky 09674 Charles E Millsap 09692 David G Seely 11397 125 North Market 16th Floor Wichita Kansas 67202 Telephone (316) 267-7361 Fax (316) 267-1754

-and-

KRAMER NORDLING amp NORDLING LLc Bernard E Nordling Erick Nordling 209 East Sixth Street Hugoton Kansas 67951 Telephone (316) 544-4333

Attorneys for Plaintiffs and Plaintiff Class

-11shy

CERTIFICATE OF SERVICE

I certifY that on July zt 2000 a copy ofthis Memorandum in Support ofMotion for Leave to Assert Claim for Punitive Damages was placed in the United States mail in Wichita Kansas first class postage prepaid addressed to

Robert J OConnor David E Bengston MORRISON amp HECKER

600 Commerce Bank Center 150 N Main Street Wichita Kansas 67202-1320

Dan Diepenbrock MILLER amp DIEPENBROCK PA 150 Plaza Drive P O Box 2677 Liberal Kansas 67905-2677

-12shy

FLEES ON GOOING COULSON amp KITCH LLc 125 North Market Suite 1600 Wichita Kansas 67202 Telephone (316) 267-7361

IN THE TWeNTY-SIXTH JUDICIAL DISTRICT DISTRICT COURT STEVENS COUNTY KANSAS

GILBERT H COULTER and ) ELIZABETH S LEIGHNOR ) individually and as representative ) plaintiffs on behalf of persons or ) companies similarly situated )

) Plaintiffs ) Case No 98-CV -40

vs ) )

ANADARKO PETROLEUM CORPORATION ) )

Defendant )

----------------------------------) AFFIDAVIT OF GREGORY J STUCKY

STATE OF KANSAS ) ) ss

COUNTY OF SEDGWICK )

COMES NOW the affiant Gregory J Stucky and affirms that the following facts are true

1 That he is one of the attorneys for the plaintiffs and putative plaintiff class herein

2 That he has served as counsel for plaintiff classes in numerous other lawsuits brought

by royalty owners against producers ofnatural gas involving claims ofbreaches ofthe contractual

obligations of the producers

3 That in the present case unlike prior Kansas cases in which he has been involved the

evidence reveals more than a breach ofcontract but also conduct (as described below) constituting

an independent tort based on constructive fraud and breach ofa fiduciary duty to the royalty owners

who necessarily had to rely upon Anadarko to fairly and accurately calculate and pay royalty to

APPENDIX I

them

4 That attached hereto as Exhibit A is a true and correct copy ofan Anadarko royalty

remittance statement mailed to one of the plaintiffs herein

5 That as reflected in Exhibit A Anadarko simply discloses to its royalty owners a

price for gas purportedly sold and a calculation ofroyalty based on such value without disclosing

any deductions other than taxes

6 That Exhibit A does not disclose the fact that the stated price which Anadarko uses

to calculate royalties as shown on Exhibit A is not the result ofan arms -length sale to a third-party

but is based instead upon a purported sale be1veen itself and its wholly-owned subsidiary Andarko

Energy Services Company (Responses to Plaintiffs Second Set ofInterrogatories and Document

Production Requests Interrogatory No6 copy attached hereto as Exhibit B)

7 That Exhibit A does not disclose the fact that in this transaction Anadarko allegedly

transfers title to the gas at the wellhead to Anadarko Energy at a price based upon a sampling of

prices which included transactions to which Anadarko is not even party (commonly referred to as

an index price) (Jon Brown Deposition at pp 37-38 copy attached hereto as Exhibit C

Responses to Plaintiffs Second Set of Interrogatories and Document Production Requests

Interrogatory No 6 copy attached hereto as Exhibit B)

8 That Exhibit A does not disclose the fact that Anadarko then deducts from the index

price expenses incurred for services perfonned be1veen the wellhead and the point at which the gas

enters the transmission pipeline in order to arrive at the price stated on the royalty remittance

statements (Jon Brown Deposition at pp 43-44 copy attached hereto as Exhibit C)

9 That Exhibit A does not disclose the fact that such expenses are incurred by virtue

ofa transaction with another Anadarko subsidiary known as Anadarko Gathering Company which

Page 2

provides services such as compression and dehydration (Jon Brown Deposition at pp 41-42 copy

attached hereto as Exhibit C)

10 That Exhibit A does not disclose the fact that Anadarkos royalty payments are not

based on the amount which is actually received for the gas upon sale to a third party but on an

artificial net value that was arrived at as described above (Jon Brown Deposition at pp 43-44 copy


11 That Exhibit A does not disclose the fact that sales to third partes are at times at prices

which exceed the index price that is used as the starting point for Anadarkos royalty payments (Jon

Brown Deposition at pp 47-50 copy attached hereto as Exhibit C)

12 That Exhibit A does not disclose the fact that Anadarko Energy and Anadarko

Gathering Company did not possess (and never have possessed) the essential elements of an

independent entity and were in fact the alter egos ofAnadarko Petroleum (Affidavit ofGerald H

Graham PhD)

13 That in his opinion Anadarkos conduct (including acts and omissions) warrants the

imposition of punitive damages in order to punish such conduct and deter Anadarko and others from

like conduct in the future

14 That in his opinion ifplaintiffs are permitted to pursue a claim for punitive damages

in this case it is more probable than not that such a claim would be successfuL

FURTHER AFFIANT SA YETH NAUGHT

Page 3

Affirmed before me this~day of July 2000

My commission expires

NOTARY PUBUC bull Stale of Kansas KATHIE J T~ J

bullbull l+i bull My Appt Exp$-J1t

Page 4

10

ANADARKO PETROLEUM CORPORATION p 0 BOX 1330 HOUSTON TEXAS 7725

in ThIs Statement For Tax Purposes OupJicate$ Will Not Be Furnished nquiries on this payment please write to the address on this statement

k rer to your Owner Number and Property ID on all correspondence

CHECK DATE 04252000 CHECK NUMBER 1083818 OWNER NUMBER J5 800 lOPAIY 10 0 NItl

SA~ES U GIlOS VOtII1shyl)T~ CCI

Oljl23 J NCR a- U

I 60 i l~pO

03 0 20 5J3SIoO fl0S 18 C( IJIrQ C 1

O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J

~ ~ bull ~ -w bullbullbullbullbullbullbull (

OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1

OWNrQS SIAAE ~ ONOTes NGATli)

GltOSS Wl JpLNn PAYMrT

i o~a j 0~S i1oo~~ i 9S 6S

i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342

SEE LEGEND ON BACK TOTAL ~sa14

EXHIBIT

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF KALlSAS

GILBERT H COULTER and ) )ELIZABETH S LEIGBNOR )Individually and as representative )Plaintiffs onbehalf ofpersons or concerns )

Similary situated ) )

Plain tiffs ) Case No 98-1413-VEB vs --)

) -- )ANADARKO PETROLEUM )~ CORPORATION ) )

Defendant )

-----------------------------)

RESPONSES TO PLAINTIFFS SECOND SET OF INTERROGATORIES AlID

DOCUMENT PRODUCTION REQUESTS

Defendant Anadarko Petroleum Corporation (Anadarko) submits the following

responses to Plaintiffs Second Set of Interrogatories and Document Production Requests

(Interrogatories and Document Requests)

GENERAL OBJECTIONS

1 Anadarko has not completed its investigation of the facts relating to this case its

discovery or its preparation for trial Anadarkos responses therefore are made only on the

basis of such information and documents as are currently known to exist or are reasonably

available tnadarkos responses do not purport to constitute a fmal statement of its knowledge

regarding the particular subject a1d are made without prejudice to its right to introduce additional

evidence or documents at the time of trial or to supplement its responses as appropriate once

tnadarko has completed its investigation discovery and trial preparation

EXHIBIT

I eurogt

INTERROGArORY NO6 In connection with each and every sale of natural gas bymiddot

Defendant Company

a ident~fy each and every gathering agreement contract for sale of gas pipeline

tariff or any other document pursuant to which such gas is processed treated

gathered or transported and then sold by Defendant Company and

b describe each and every requirement orspecification contained in such document

relatiRg9 any physi~~l or chemicaI_~~ndition of suc~ ga~ or the pressure of such

gas

RESPONSE Anadarko objects to this interrogatory on the grounds that it is

overly broad unduly burdensome and seeks information neither relevant to the claims or

defenses of the parties nor reasonably calculated to lead to the discovery of admissible

evidence in that this interrogatory is unlimited in time and purports to cover Anadarkos

gas marketing activities during periods of time in which Plaintiffs claims are barred by

the applicable statute of limitations Moreover this interrogatory is not limited to the gas

in issue Subject to and without waiving these objections and the General Objections

Anadarko states as follows

The nly such contract as to the gas in issue is the Gas Sales Agreement between

Anadarko and Anadarko Energy Services Company a copy of which has been produced

to Plaintiffs (Doc No APC-1582 - APC-1588) The only requirements and

specifications relating to the physical or chemical condition of the gas in issue or the

pressure of such gas if any are set forth in that document Anadarko is not a party to any

gathering or processing contracts relating to the gas in issue

9

1

IN THE UNITED STATES DISTRICT COURT FOR THE DI~TRICT OF KANSAS

GILBERT H COULTER and ELIZABETH S LEIGHNOR individually and as representative Plaintiffs on behalf of persons or companies similarly situated

Plaintiffs

VS CASE NO 98-1413-WEB

ANADARKO PETROLEUM CORPORATION

Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy

ORAL DEPOSITION OF JO~ D BROWN produced as a wi tness duly sworn by me at the instance of the

I

Plaintiffs taken in the above styled and number~d cause on September 29 1999 from 854 am to 321 pm before Jan Johnston certified Shorthand Reporter No 1124 in and for the State of Texas at the offices of AnadrkoPetroleumCorporation 17001 Northchase~ Houston Texas 77060 pu~suant to the Federal Rul~s of civil Procedure and the provisions stated on the record or attached therein

-

JOHNSTON REPORTING SERVICE

R~altime Aviation amp Technical Specialties

4545 Post Oak Place Suite 300 Houston Texas 77027

1114 Bayland Avenue Houston Texas 77009-6509

Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT

CONDENSED TRANSCRIPT 2l c UlTTU W()Dn TlV7 J7Y

I

tember 29 1999 Multi-Pagetrade lONDBROWN 98-1413-WEB Coulter amp Leighnor YS Anadarko

Page 37 Page 39 1 ransported 1020lt51 Q Well lets just start then with the 2 Okay now why dont you agree with that 2 description here of September 1993 to June 1995 3 statement Hgt2U)5 3 MR McCLAIN It sounds like you are 4 A Basically what we were just talking about each 1llt2100 4 making a transition to the HUGS system Have you beeni5 one of the wells has a different - not every one is not IOaIil9 5 going about an hour and a half I6 different but there are different gathering and fuel 1102111 6 MR OCONNOR We have already taken a

bull 7 rates for different wells on the system unless Im I 8 misreading that 9 Q Now there is a formula that appears kind of 210 indented at the bottom of Page 38 11 A Yes bull 12 Q Do you see that formula

13 A Yes sir 1021J9 13 this Let me try to describe how I understand this to ~ 14 Q And do you agree with that formula 1102141 14 be and then you can -- I will ask you some questions I() 15 A Im not sure that I understand what you mean do 1021515 whether or not my description is correct 3 16 I agree with it 102149 16 With regard to this period of September of 1993 17 Q Is that the manner in which royalty is to June of 1995 Anadarko began with a price that was 18 calculated 102217 18 equal to the weighted -- its weighted average sales S~ 19 A Yes thats correct 1tr2223 19 price per Mrv1Btu for all sales made for production from 03 20 Q Now Im looking at the - it says Proceeds 10-2132 20 wells connected to the HUGS pipeline system is that (fI 21 equals AES revenue Do you see that 1amp2Z3721 correct 11 22 A Im sorry I misspoke That is not correct i 1022a7 22 A Im not sure that I understood exactly what you IS 23 Q Why isnt that a correct formula 11022016 23 said Would you repeat it for me

18 24 A The formula that is currently being used d0a24924 Q Yeah Can you describe to me what you are aD 25 proceeds would be the Inside FERC index minus the AGC 102)1lI25 referring to or what is being referred to as the price

Page 38 Page 40 14 trges 102)10 was calculated based upon Anadarkos weighted average 24 2 Q So its not necessarily the AES -shy 102314 2 sales price per Mrv1Btu l7 3 A That I s correct lO2J17 3 A That was the weighted average sales of the gas 3 4 Q Do you see any other statements which you would IO23ZI 4 off of the system It was identical to the way

100ZJlS 5 Panhandle was done in the 93 to 94 time period It 158 6 A I dont believe so 148 5 believe to be incorrect in that section

lo-Zl30 6 was just a different set of sales to get the average S9 7 Q I would refer you to the fIrst line on the 102JJ5 7 Q There is a reference obviously to Anadarko in

(1)-2339 8 that statement To what Anadarko entity does that

9il9 9 the record The same formula is applied to each Mcf 906 8 fIrst full paragraph of 39 I will just read it into

JOZJ45 9 refer 901gt 10 regardless of where produced in the system and II)-Zl8 10 A I cant say for sure because I dont recall the

gt15 11 regardless of where originated or delivered from the IO2lSO II dates There woriId have been a time period where it

1gt1812 AGe system Do you see that 102)55 12 would have been Anadarko Petrolewn s sales off of the

9-lJ 13 A Yes I do see that and I was wrong that is 102357 13 system and then there would have been a time period gt25 14 incorrect U)2)59 14 where it would have been Anadarko Trading or Energy 19lt215 Q Now lets go back to Exhibit 91 again please 10240 15 Services but I dont remember the specific time periods 1000 16 and I want to talk a little about the HUGS gathering 1102400 16 of when those entities were created

1004 17 system that is described on -- mentioned on Page 4 of 11lt24lt5 17 Q Let me band you what has been previously marked

2012 18 that exhibit Are you with me 102449 18 as Graham Exhibit 12 Do you recognize that document

ZQlS 19 A Yes sir 1l~2$IO 19 A Im sure I have probably seen it before but

2lllt2420 Q Is my understanding correct that the HUGS jI0251320 not anytime recently

lO17 21 gathering system w-as built in about 1990 20)2 22 A I really dont remember the date 2(gt35 23 Q Do you know whether or not it was prior to lgtI7 24 September of 1993 2044 25 A I dont recall

amp2hll 7 break S MR McCLAIN You have already taken a 9 break

MR STUCKY Do you want another break 10ml 11 THE WITNESS Im fme 10-2137 12 Q (BY MR STUCKy) Im going to try to shortcut

102515 21 Q As I understand that is the gas purchase and 10251922 sales agreement between -shy102521 23 A Petroleum and Trading yes 100ZlZl 24 Q And whats the date ofiliat - the effective 1amp1S2 25 date of that document

)ae 37 - Page 40 JOHNSTON REPORTING SERVICE f71-t -t-Qi)

I

JOND BROWN Multi-Page1M September 29 1999 Coulter amp Leighnor vs Anadarko No 98-1413-WEB

I Page 41 1 A Oh October of 1994 2 Q Lets see the 1st day ofshy

102llS 3 A The lst day of October lOINI 4 Q -- of 1994

5 A Uh-huh 10-241 6 Q Now we were tIying to determine what Anadarko OlS32 7 entity was referred to in this description of the HUGS 02556 8 pipeline from September of 1993 to June of 1995 Based 102601 9 upon the Graham Exhibit 12 can you now tell me what 10-2611 10 Anadarko entity that reference is made to 1ltgt2618 11 A Well from October 1st of 1994 it would be 1112624 12 Anadarko Trading 10-2625 13 Q And prior to that time it would be Anadarko 1026-29 14 Petroleum Corporation is that correct 102629 15 1026J4 16 IOZO51 17 102659 18 1112101 19 102121 20 102726 21

1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25

A To the extent that this is the first contract within Trading and Petroleum that would be coirect

Q And then it says Less the gathering fee and fuel deduction charged by Anadarko Gathering Company

A Yes sir Q Am I correct in understanding that there

existed some kind of contractual relationship between Anadarko -- a gathering agreement between Anadarko Gathering Company and Anadarko - excuse me Im

sorry - and the Anadarko entity which was producing the gas during this period of time

Page 42 A Between Anadarko - which Anadarko Im sorry Q Anadarko Gathering Company and the entity which

used the Anadarko gathering system A I would assume that there was Q And is it your understanding that if that is shy

if a document such as that existed that would be the document that would reflect the gathering and fuel _

the gathering fee and fuel deduction charged by Anadarko Gathering Company

A I would assume so MR OCONNOR I wish you would answer him

what you know If you dont know then dontassume Just tell him what you know but lets not guess

Q (BY MR STUCKy) Now with respect to this time period September of 1993 to June of 1995 with respect to the HUGS pipeline how was the value reflected on the royalty remittance statements for that gas

A Weighted average sales price less the gathering fee and fuel deduction

Q Again were there two values the flrst value being the Anadarko weighted sales price and then another value representing the deduction for the gathering fee and fuel

A No Q There was only one number which was a net

102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3

103200 4 103101 5 10320) 6 10~tl1 7 to3lJ1 8 103225 9 10)228 10 103229 11 103231 12 103ZlS 13 Hl32l8 14 103247 15 10)258 16 10330) 17 IO)JOT 18 10)308 19 103)102Q

1131221

1011222

103442 23

10 24

1103451 25

Page 43 number after the deduction of the gathering fee and fuel deduction is that correct

A Thats correct

Q Now Im sorry sir I am out of order here I need to go back now to the PEPL pipeline August 1996 to date period

A Db-huh Q And ask you exactly the same question with

respect to royalty remittance statements For that period August of 1996 to date how did the value for gas appear on royalty remittance statements

A It was the Inside FERC gas sales price less the gathering fee and fuel deduction

Q Did the royalty remittance statements have two numbers or two values one for the FERC Gas Market Report sales price per MMBtu Panhandle Eastern Pipe Line Company Texas Oklahoma mainline and then a separate value for the gathering fee and fuel deduction

A No we did not Q Again there was only one value and that value

was a net value that was arrived at by doing the calculations that we have just described is that correct

A Thats correct Q Now Im sorry weve got to go down HUGS

Page 44 pipeline July of 1995 to November of 1996 Was there a change made with regard to the gas that flowed through the HUGS pipeline witIl respect to the royalty calculation in July of 1995

A Yes Q Vhat was that change that was made A We began using the Inside PERC gas market sales

price as opposed to the weighted average sales price Q And why was that change made A I dont know Q And who made the change A It would have been someone in Marketing Q And do you know whether or oot all sales that

were made by an Aoadarko entity for the gas that flowed through the HUGS gathering system commanded a price that was equal to the Inside FERC gas market sales price per MMBtu for Panhandle Eastern Pipe Line Company Texas Oklahoma mainline

A No I do not know that Q Do you have any information with regard to

that A No Q Now Mr Brown I want to again refer you to

Deposition Exhibit 91 -shyA Okay

Page 41 - Page 44JOHNSTON REPORTING SERVICE

I

September 29 1999 Multi-Page TM lONDBROWNNo_ 98-1413-WEB

Page 45

-

1 Q - and the description that is contained under 2 the PEPL pipeline for August 1996 to date

IOJOC 3 A Uh-huh 103509 4 Q Okay Now you have made a correction with lQ-S19 5 regard to that description is that correct 103SzJ 6 A You are looking at the August of 96 to date 103521 7 Q Yes sir 103DI amp A Yes Hl3SJ3 9 Q Now subject to that correction is my 100JSltW 10 understanding correct that that description would lQ3SS3 11 describe the manner in which all royalty is calculated H36az 12 presently with respect to all gas that flows through 10601 13 what is now known as the Kansas gathering system 10361514 A Yes 103llt21 15 Q Mr Seely has reminded me that I failed to ask 103629 16 you the remittance question with regard to the HUGS 10~J2 17 pipeline shy103li33 18 A Before you do that can I make a correction on IOC635 19 my last statement there 10C637 20 Q Sure IO3U8 21 A That would be 1rue as to the royalty payments 10364122 for the gas that flows through that system that is 103amp44 23 Anadarkos gas Petroleum Corporations gas There is 1()J64 24 third-party gas that flows through there arid I have no 103652 25 clue as to what theyre doing

Page 46 1 Q Im sorry yes And that would be true with

55 2 respect to all of these 103656 3 A Exactly

103100 4 Q And Mr Seely has reminded me that I didnt ask lol7OJ 5 you the royalty remittance question with regard to the 10-3700 6 time period July of 1995 to November of 1996 for the 103710 7 HUGS gathering system And my question with regard to 103717 8 that period of time is how the value for gas was Uk3722 9 reflected on the royalty remittance statements 103126 10 A It was the Inside PERC sales price less the 103732 11 gathering and fuel deduction 10-3734 12 Q And here again there did not appear two 103740 13 values the ftrst value being the Inside FERC price and 103146 14 then the deduction 103743 15 A Thats correct 10-3149 16 Q But only one price which is a price -- which 1037$5 17 is II net price that netted out the gathering fee and 1~3M4 18 fuel deduction charged by Panhandle Eastern Pipe Line 1038Q9 19 Company is that correct 101809 20 A Thats correct 10381621 Q Now Mr Brown I have handed you what has been 1()382622 previously marked as Graham Exhibit 29 Why dont you 10)31 23 take a look at that if you would please 103156 24 A Okay 103859 25 Q Have you seen this document before

Coulter amp Leighnor vs Anadarko Page 47

103901 1 A Not to my knowledge 10-3905 2 Q I would like to refer you to the fIrst page of 103901 3 that document which has been marked as APC-1651 and 103917 4 specifically to the second paragraph of that document 103920 5 and let me just read it so we can get it into the 103931 6 record (a) the Panhandle Eastern Pipe Line Company 103137 7 Index price for Texas Oklahoma (mainline) as published 103942 8 by the first issue of Inside FERCs Gas Market Report 13946 9 under the section entitled Prices of Spot Gas Delivered 10]95010 to Pipelines for the month in which gas was delivered 1039$4 11 by Seller to Buyer (the Index Price) and (b) twenty 104004 12 cents per MMBtu Do you see that 1O4O11 13 A Yes uh-huh IOltWlI 14 Q Now the first phrase there the Panhandle 104015 15 Eastern Pipe Line index price is the same price that we 10402$ 16 have been -- that is described on Exhibit 91 is that 104CT12 17 correct 10ltWt2 18 A Yes sir 1040J4 19 Q Okay And its your understanding that under 10404320 this contract that is Graham Exhibit 29 the price is 104055 21 the index price the Panhandle index price plus 20 1crltW5922 cents is that correct Hl4100 23 A Thats what it says 104103 24 Q Now if in fact this contract is in existence 10411425 and the price is index price plus 20 cents is it my

Page 48 104121 1 understanding that the manner in which royalty presently IMI2Ii 2 is calculated would not include the 20 cents per Mc1Btu IMI36 3 that is referred to 104139 4 MR McCLAIN I want to object to that 104141 5 question It assumes facts not in evidence He does 104141 6 not know if that contract is in existence or not It 104141 7 assumes facts not in evidence and it calls for 104111 8 speculation on the part of the witness so I object to lo~l54 9 the form of the question 1041S~ 10 Q (BY MR STUCKy) You may answer 104(l 11 MR McCLAIN Well you can answer to the 10420) 12 extent you know or dont know 1[gt4205 13 MR STUCKY I aSsume the contracts-shy1-4206 14 MR McCLAIN I mean you are asking him 104201 15 to make an assumption -shy104209 16 MR STUCKY I told bim to make the 10042lI 17 assumption Assume the contract is in existence 10421~ 18 MR McCLAIN Well I object to it as it 104211 19 calls for speCUlation because it assumes facts not in 104zzI20 evidence It assumes a contract is in existence that lMlZ4 21 mayor may not be in existence and I dont want the 1l)4217 22 witness to speculate about a matter like this on a 104229 23 contract that we dont even know whether its in 104231 24 existence or lOt

H)42) 25 MR STUCKY Are you instructing the

Page 45 - Page 48 JOHNSTON REPORTING SERVICE

JONDBROWN Multi-PageTh September 29 1999 Coulter amp Leighnor vs Anadarko No 98-1413-VVIaa

Page 49 e- 1 witness not to answer the question

2 MR McCLAIN Well Im asking him to 10amp 3 answer it to the extent he knows or doesnt know and not lo42AI 4 to speculate Thats my instruction So with that )4245 5 instruction Mr Brown you can proceed please I04H8 6 A The royalty price as we have described would

104253 7 have been the Inside PERC less the gathering and fuel 104258 8 deduction

lWl259 9 Q (BY MR STUCKy) So in other words a royalty lOA)OO 10 would not be paid on the additional 20 cents is that lMl06 11 correct

IMl06 12 A I guess Ive answered it Utat it would be paid 1031013 on Inside PERCs Gas Market Report price

104H3 14 Q But it would not be paid on the 20 cents is lo4U5 15 that correct IM315 16 A Thats correct

1M35 17 Q Now I want to shift gears a little Mr Brown 1Ml18 so kind of bear with me 104351 19 A Okay

Q We have been discussing Interrogatory 1 which is contained in Brown Exhibit 91 Now are you aware

104440 22 with respect to at least some of the production that is 10445123 described in or referred to in that interrogatory that

the gas flows through the National Helium plant

A Yes

Page 51 104711 1 manner in which royalty is calculated for helium yet is I04UI 2 that correct 104721 3 A Thats correct 104723 4 Q Okay And good counsel has referred us to U)471 5 answer to Interrogatory 8 -by dont we go there which 104132 6 is 1 104733 7 AOkay 104742 8 Q It says Anadarko calculated and paid royalty 104146 9 on helium that was extracted from the gas in issue based 104749 10 upon the gross proceeds received by Anadarko from the 1O47SZ 11 purchasers of the helium Anadarko paid royalties on 10475amp 12 the gas in issue based upon said proceeds okay Lets IO48)4 13 stop there okay 104805 14 A Yes sir 1048~ 15 Q Now let me make sure lunderstand whats being 104813 16 said there Anadarko Petroleum Corporation receives 104825 17 proceeds from purchasers of the helium is that correct lo4821 18 A We receive the proceeds from National Helium UI1gt6 19 Q And National Helium would be the purchaser of 1041) 20 the helium

104842 21 A National Helium would be the seller of the 10-4S 22 helium

lolt8~ 23 Q And who is themiddotmiddot Im Dot trying to be too 1048$3 24 technical here but you receive proceeds from National

bull10905 25 Helium in regard to the Anadarko gas in regard to the

Page 50 Page 52 I 1 Q Do you know whether or not some Anadarko entity jI0915 1 Anadarko helium extracted at the National Helium plant

2 receives revenues in connection with the activities that 10920 2 is that correct

1045)1 3 are perfonned in that plant 10w 3 A Thats correct 104541 4 A Yes 1O2Z 4 Q And then you turn around Anadarko Petroleum 104542 5 Q Can you describe to me what types of 11026 5 Company turns around and makes payment to its royalty 104546 6 revenues - 100n 6 owners without deducting any amounts from the proceeds 104$47 7 A Anadarko Petroleum receives helium payments 10-4939 7 it receives from National Helium is that correct IIM551 8 payments for helium thats extracted 11~942 8 A Thats correct Quite frankly I cant recall 104555 9 Q Does anyone else receive -- in the Anadarko 1049~8 9 right now whether the helium was taxable in Kansas or 10455 10 family receive any payments as a result of the 104951 10 not If its taxable we would deduct the severance 104601 11 activities that take place iii that plant 104955 11 taxes Iom 12 A I dont know IIM9s12 Q SO in other words if the helium is worth $20 a 104606 13 Q Now lets start with helium Does the 10-5M4 13 particular volume and Its coming from one well and the 104631 14 interrogatory response to Interrogatory No1 of Brown 105018 14 royalty owner has a 18th royalty then you would pay

10463715 Exhibit 91 reflect whether or not royalty is received 10502J 15 the royalty owner 18th of the $20 is mat correct 104700 16 for helium 105023 16 A If the $20 is what we received from National

104703 17 A In response to Interrogatory 11 UlSo-32 17 Helium yes thats correct 10470518 Q Yes 1105041 18 Q Okay now lets go to the last sentence in the 104706 19 A I dont believe so no 110504719 response to Interrogatory 8 Anadarko does not receive 10700 20 MR OCONNOR For the record IGlOSl 20 any payments for the natural gas liquids if any that 1IG9 21 Interrogatory 8 does loSO5721 are removed from the natural gas in issue subsequent to 104711 22 MR STUCKY I understand that sir 10-5101 22 the sale of that gas by Anadarko Do you see that

104711 23 Counsel I was just trying to make sure that we are 105105 23 A Yes 10471424 tracking 105107 24 Q I guess here we have some definitional issues

1471525 Q (BY MR STUCKy) So we havent discussed the 1051125 we are going to have to deal with We have a reference

Page 49 - Page 52 JOHNSTON REPORTING SERVICE 71 l lcc _oc

FLEESON GOOING COULSON amp KITCH LLC 125 North Market Suite 1600 Wichita Kansas 67202 Telephone (316) 267-7361

IN THE TWENTY-SIXTH JUDICIAL DISTRICT DISTRICT COURT STEVENS COUNTY KANSAS



vs ) )


Defendant

AFFIDAVIT OF GERALD H GRAHAM PhD

STATE OF KANSAS ) ss

COUNTY OF SEDGWICK

COMES NOW the affiant Gerald H Graham and upon his oath states that the following facts are true

A That I am a Professor and immediate past Dean of the W Frank Barton School of Business at the

Wichita State University

B That at the request of counsel for the plaintiffs I have reviewed materials regarding this case in order to

determine whether Anadarko Petroleum Corporation and its subsidiaries (Anadarko Gathering Company and

Anadarko Energy Services Company) meet the factors of the alter ego test set out in International Union United

Auto Etc v Cardwell Mfg Co 416 F Supp 1267 1286 (D Kan 1976) and other Kansas court decisions

C That my opinion is based on my training and experience and on my review of the following materials

the depositions of ONeil J Toups Randall Tonnesen Joe Toups Mike Ross Diane Dickey and documents

pertaining to officers and directors as well as various other financial documents provided to me by plaintiffs

counsel

D That my conclusions and the bases therefore with respect to each of the factors are set forth below

APPENDIX II

1

1 Whether parent owns all or majority of capital stock in subsidiary-The parent company Anadarko Petroleum owns all of the capital stock of Anadarko Energy Services and Anadarko Gathering

a Anadarko Petroleum is listed as the Sale Stockholder of AES (41699 minutes)

b Anadarko Petroleum is listed as the Sale Stockholder of AGC (3-2-99 minutes)

2 Whether corporations have common directors or officers--All of the officers of Anadarko Energy and Anadarko Gathering are either directors or officers of Anadarko Petroleum

a AES directors Allison Seitz Rose and Martin are either directors or officers of Anadarko Petroleum and they are also directors of AGC(4-6-99 minutes)

b All 13 officers of AES are also officers of Anadarko Petroleum and officers of AGC and have essentially the same titles in all three companies (3-2-99 minutes)

c AGC directors Allison Seitz Rose and Martin are either directors or officers of Anadarko Petroleum and AES (3-2-99 minutes)

d The lists of officers and directors of APC AGC and AES from 1995 through 1999 also confirms this conclusion

3 Whether the parent fmances the subsidiary-It appears that the parent finances 100 percent of the subsidiaries The parent initially financed each of the subsidiaries 100 percent by issuing 10000 shares of stock to each subsidiary that apparently was set up as a receivable on the books of the parent Further later injections of capital of which there are only two or three instances came from the parent It also appears that the subsidiaries do not borrow on their own

a Parent provides funding required to meet whatever their (AGC) capital or operating needs are (Tonnesen p5)

b All of the funding except for internally generated funds are provided with loans from affiliates (Tonnesen p7-8)

c In general the flow of funds among the three companies operates more like one firm ~ith profit centers rather than three different companies For all practical purposes the funds are treated as if they belong to one company (Tonnesen pp 7-13)

d APC provided all of the initial capital for AGC and AES and has injected additional capital since the inception of AGC and AES (Dickey pp 9-10) (Dickey pp 4-8 May 18)

e AGC and AES do not borrow money on their own all of their borrowing is internal from other entities withinAPC

4 Whether the parent subscribes to all of the capital stock of the subsidiary-The parent subscribes to all of the capital stock of the subsidiaries

a Anadarko Petroleum owns all of the capital stock of Anadarko Energy Services and Anadarko Gathering

S Whether the subsidiary has grossly inadequate capital-Apparently the subsidiaries have no capital and no access to capital except that which is provided by the parent The issue of capital then would depend upon the adequacy of APCs capital

2

a From the depositions it appears that AGC and AES have for all intent and purposes no capital apart from APe It is intermingled in the data base and there does not appear to be a systematic reporting that separates the three entities as you would expect if they were truly three different companies

6 Whether the parent pays salaries expenses or losses of the subsidiary-The parent pays the salaries and expenses or losses of the subsidiaries

a AGC and AES apparently have no employees All personnel who do the work for AGC and AES are on the payroll of APe only (p 89 Toups)

b The parent provides all employment services of AGC and AES (Dickey pp 8-9 May 18)

c Under the management services agreement it appears that APe provides all of the personnel necessary to operate AGC and AES Apparently there are time sheets but these appear to be more of a formality of documentation (Dickey pp 13-21 May 18)

7 Whether the subsidiary has substantially no business except with the parent or no assets except those conveyed by the parent-8ubsidiaries appear to have no business or assets except those supplied by the parent

a From several depositions it appears that the subsidiaries do almost all of their business in the Hugoton Field with the parent

b Further the parent provides all of the assets to the subsidiaries and the co-mingled data base does not provide separate reporting as you would expect if there were truly three different companies

8 Whether subsidiary is referred to as a department or division-It appears that there are many aspects of a AES and AGC functioning as a department within a corporation rather than existing as a separate subsidiary of another corporation

a Reference to departments in the context of describing flows of information regarding pricing eg bull those are integrated systems where data is input in one part and utilized by departments in another part of the system (p 24 Toups)

b Although the m8Lketing department was described by Toups as being associated with AES not Anadarko Petroleum his only way of identifying which cooperate entity they worked for was his personal knOWledge for instance My personal knowledge of the personnel involved tells me who is doing what functions (p 25 Toups)

c All employees of AES are also employees of Anadarko Petroleum

d Several people seem to be doing work using a highly integrated accounting system for three different entities with no clear demarcation among the entities nor functions of employees

e Mr Toups functions are referred to several times as my department or your department and since his efforts are approximately 100 percent for AES and AGe it appears that his functions are considered as a department within APe As one instance Mr Toups says that he has a budget for his department and to exceed the budget he has to get approval from his superior presumably an employee of APe (again implying a departmental relationship with APC (p 110 Toups)

f References to production departments and measurement department There appears to several references to entities as a department that implies that Ross does not think of the functions as existing in different companies (pp 6-8 Ross)

3

9 Whether directors or executives of the subsidiary do not act independently of the parent-It appears that Mr Toups as the Manager of Marketing Accounting for Anadarko petroleum does not act independently of the parent even though he states that approximately 100 percent of his time is allocated to the costs of AES and AGS

It also appears that other persons who are listed as officers and directors of the subsidiaries do not act independently and this is especially noticeable regarding budgeting pricing and cost allocation decisions

a It seems unusual that Toups acting as an executive in AGe had no input into the decisions of important items such as contract terms for gathering services for example to the question Are you familiar with what goes into the rate or the fee that charged under these contracts how it was computed and what it consists of Mr Toups response was No (p 49 Toups)

b Further Mr Toups apparently had no involvement in the creation of budgets concerning the operating of the gathering service (p 52 Toups)

c From the deposition it appears difficult to isolate sales of AES independently from Anadarko Petroleum Rather a formula rate is applied to AES and Mr Toups has no say-so in the contracted formula rate (pp 56-63 Toups)

d APe sets the budget for the total company including AES and AGS and according to Mr Toups testimony the subsidiaries do not operate as independent budget units as they do not prepare separate budgets for the subsidiaries (pp 92-93 Toups)

e It does not seem reasonable to set up three different companies for the primary purpose of internal controls eg a good double-check to have separate entities performing similar operation in order to catch discrepancies (p 97 Toups)

f Mr Tonnesens testimony also suggests that there is no distinction between his responsibilities with the parent and AGe

g In putting together the operating and capital budgets the entities appear to operate as one system For example the board of APC approves the budgets Although both AGe and AES have directors they appar~tly do not approve budgets for AGe or AES Rather budgets are consolidated and approved by the APe board (Dickey)

h Even though income statements are prepared for AGe and AES they appear to function primarily as input to the consolidated statement Thus AGe and AES are more like a profit center of APe (Dickey pp1O-l1 May 18)

i No periodic reports that flow between people in AES and APe and there is reference to fully integrated systems from which reports might be extracted But there are not regular and periodic reporting between AES and APe that you would expect if AES were truly a subsidiary acting independently of APC (Toups p 10-11)

j No separate financial statements for AGe If AGe were truly separate you would expect to see financial statements (Dickey p 30)

k APe apparently provides comprehensive services (engineering accounting etc) to AES and AGe There do not appear to be services necessary to run operations that are not provided by the parent (Dickey p 17-19)

4

I Mr Tonnesen makes no distinction between what he does as an officer of the company and what he does as a division or department of the company (Tonnesen p 6)

m The funds appear to be so co-mingled among APe AGe and AES that it would be hard to conclude that they are operating as three separate entities The co-mingling can be illustrated on three levels (1) APe manages the cash for all the total corporation (meaning APe AGe and AES) (2) there is no payment of interest for any funds that might be loaned from one group to another and (3) gathering fees are merely reflected in reports and monthly settlements (loans are increased or decreased) are made with no actual transfer of funds (Tonnesen pp 10-13)

10 Whether the formal legal requirements of the subsidiary as a separate and independent corporation are not observed-I did not have the evidence or the expertise to evaluate this item one way or the other

E From the evidence that I have reviewed it appears that APe AES and AGS clearly meets nine the

conditions set forth by Cardwell to determine whether companies are as a practical matter functioning as one

company rather than three separate companies (I did not have the data or the expertise to evaluate condition 10)

For example

1 The parent owns all of the stock of the subsidiaries

2 All three corporations have common directors and officers

3 The parent finances the subsidiaries

4 The parent subscribes to all of the capital stock of the subsidiaries

5 The subsidiaries have no capital except that which is supplied by the parent

6 The parent pays salaries of the subsidiaries employees and expenses or losses

7 The subsidiaries have substantially no business nor assets excepts those provided or owned by the parent

8 Subsidiaries are referred to and appear to be treated as departments within one company

9 There is no evidence that directors or officers act independently of the parent For instance Mr Toups who

devotes approximately 100 percent of his time to the subsidiaries does not appear to be acting independently of

the parent

F In short the boundaries between the three companies seem nonexistent I do understand that

for accounting and reporting purposes costs and revenue are allocated to the three entities

However there does not appear to be value added by allocating costs to three entities

5

FURTHER AFFIANT SAYETH NAUG~ ~ f)~P~JL Gerald H Graham PhD

Sworn to and subscribed before me thisdstkay of July 2000

6

hereinl thereby giving rise to a claim for punitive damages

From the outset of this lawsuit plaintiffs have asserted claims for breach of fiduciary duty

and constructive fraud against Anadarko Petroleum Corporation (Anadarko) as the result ofits

failure to fully disclose the manner in which it calculates their royalty payments (Petitionat p 5

1M Defendant has breached its fiduciary duty by reducing royalty payments to members of the

plaintiff class and by failing to disclose such reductions By such conduct defendant has engaged

in constructive fraud) Plaintiffs now seek leave ofcourt pursuant to KSA 1999 Supp 60-3703

to pursue punitive damages in connection with those claims

Anadarkos hTItten information accompanying its royalty checks concealed material facts

Specifically it omitted all reference to the following

(1) the value which it was ( and is) using to calculate royalties is not the result

of an actual arms -length sale but is instead based upon a sampling ofprices which

included transactions to which Anadarko was not even party (commonly referred to

as an index price)

(2) From the amount based on that artificial value Anadarko deducts from royalty

payments expenses incurred for services performed between the wellh~d and the point at

which the gas enters the transmission pipeline

(3) Anadarko was not (and is not) basing the royalty payment on the amount

which it actually receives for the gas which often exceeds the index price

(4) Anadarko was (and is) relying on a transaction between itself and its

wholly-owned subsidiary Anadarko Energy Services Company whereby the former

lPlaintiffs claim for breach ofcontract is separate from and in no way dependent upon the independent tort claims for constructive fraud and breach of fiduciary duty

-2shy



payments





















-3shy























-4shy

















-5shy




















-6shy






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them



































Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

Page 51 104711 1 manner in which royalty is calculated for helium yet is I04UI 2 that correct 104721 3 A Thats correct 104723 4 Q Okay And good counsel has referred us to U)471 5 answer to Interrogatory 8 -by dont we go there which 104132 6 is Page 11 104733 7 AOkay 104742 8 Q It says Anadarko calculated and paid royalty 104146 9 on helium that was extracted from the gas in issue based 104749 10 upon the gross proceeds received by Anadarko from the 1O47SZ 11 purchasers of the helium Anadarko paid royalties on 10475amp 12 the gas in issue based upon said proceeds okay Lets IO48)4 13 stop there okay 104805 14 A Yes sir 1048~ 15 Q Now let me make sure lunderstand whats being 104813 16 said there Anadarko Petroleum Corporation receives 104825 17 proceeds from purchasers of the helium is that correct lo4821 18 A We receive the proceeds from National Helium UI1gt6 19 Q And National Helium would be the purchaser of 1041) 20 the helium
















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6



payments





















-3shy























-4shy

















-5shy




















-6shy






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)











Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6























-4shy

















-5shy




















-6shy






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

















-5shy




















-6shy






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

1 104711 1 manner in which royalty is calculated for helium yet is I04UI 2 that correct 104721 3 A Thats correct 104723 4 Q Okay And good counsel has referred us to U)471 5 answer to Interrogatory 8 -by dont we go there which 104132 6 is Page 11 104733 7 AOkay 104742 8 Q It says Anadarko calculated and paid royalty 104146 9 on helium that was extracted from the gas in issue based 104749 10 upon the gross proceeds received by Anadarko from the 1O47SZ 11 purchasers of the helium Anadarko paid royalties on 10475amp 12 the gas in issue based upon said proceeds okay Lets IO48)4 13 stop there okay 104805 14 A Yes sir 1048~ 15 Q Now let me make sure lunderstand whats being 104813 16 said there Anadarko Petroleum Corporation receives 104825 17 proceeds from purchasers of the helium is that correct lo4821 18 A We receive the proceeds from National Helium UI1gt6 19 Q And National Helium would be the purchaser of 1041) 20 the helium
















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6




















-6shy






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6






















-7shy















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6















1012 (1995)





-8shy













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6













-9shy












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6












CONCLUSION





-10shy




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6




-and-



-11shy






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

Page 51 104711 1 manner in which royalty is calculated for helium yet is I04UI 2 that correct 104721 3 A Thats correct 104723 4 Q Okay And good counsel has referred us to U)471 5 answer to Interrogatory 8 -by dont we go there which 104132 6 is 104733 7 AOkay 104742 8 Q It says Anadarko calculated and paid royalty 104146 9 on helium that was extracted from the gas in issue based 104749 10 upon the gross proceeds received by Anadarko from the 1O47SZ 11 purchasers of the helium Anadarko paid royalties on 10475amp 12 the gas in issue based upon said proceeds okay Lets IO48)4 13 stop there okay 104805 14 A Yes sir 1048~ 15 Q Now let me make sure lunderstand whats being 104813 16 said there Anadarko Petroleum Corporation receives 104825 17 proceeds from purchasers of the helium is that correct lo4821 18 A We receive the proceeds from National Helium UI1gt6 19 Q And National Helium would be the purchaser of 1041) 20 the helium
















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6






-12shy





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6





vs ) )


Defendant )













APPENDIX I

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

them























Page 2













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6













Graham PhD)







Page 3





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6





Page 4

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

10






Oljl23 J NCR a- U

I 60 i l~pO


O 0 GO 1 14PO 03 0 20 3j67 Elo 0

yen II( lUUSI B

o 0 (0 ~ sloo o 0 20 ~143SPO

i

~

I i

~ 1

~ i

~ sect i ~

lRlC

~ 99l600 lSlSOO

3812100 148400

-4236000 137000

lTV

706

lOn9

583

iIOSS VALUE

nb4 1~3

54~1 ~97~a

l2 Ita 13f54 3

bull

i 1

~

~

i

1 ~ ~ l

I

TA~

b~~o ~4 l l ~I jH31s1

i ~12 1633ps i ~

l i i i

~

~ ~ ~ ~ ~ ~ i

~

riT VLI

j 7t 114 l2~4EPS

i S ~6 7iS33~7

i j 2(26

13zU7 ~

I

I~

i

i

II j

~ I i I

~ I

~ ~

INT middotC

TAAN TYPIi coce

az 00 ItI 00

RI 00 ar 00

iU 00 Itt 00

I

~ ckV

J


OeCIMA~

C0071UZSO C007Sl2S0

C007B1250 0011781250

C007812$0 ( 00711250

I 1




i 2 1 10~O UrO i sa185

7 0~6 ~O1~3 jJ02~i

i i i

I

I 1

i

bull E ~ ~

i i

~ ~

I ~

~ ~ i

~

~ 2111874-3342


EXHIBIT







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6







Defendant )

-----------------------------)






GENERAL OBJECTIONS








EXHIBIT

I eurogt


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6


Defendant Company






gas















9

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

1



Plaintiffs



Defendant

ORAL DEPOSITION OF

JON D BROWN

September 29 1999 -

----__----_-___----------_----------_----_-------shy


I


-





Telephone (713) 355-9252 (713) 626-2629

Fax (713) 622-7701

Restel (713) 869-8202 Resfax(713 8S9-9601

janjpdqnet

Lshy __________________________________________________________I EXHIBIT


I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

I
























I





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6





1027 22

1l2134 23 10213124

102750 25

1 102756 2

HUM 3

102810 4 10lSl$ 5 101821 6 10282 7 102833 8 1021)7 9 102131 10 102140 11 102amp412

102141 13

102854 14 0215$ 15 1(gt2901 16 102910 17 10291lt 18 102917 19 10292120

10292721

10-~l322

10-29lt12 23

10_324

UI2944 25
















102gt49 1 102953 2 102gt5J 3 102956 4

10-2959 5 103006 6 10raquo08 7 103010 8 103013 9 IOlOI6 10 103025 11 103032 12 103030 13

103031 14 103045 15 100JOSJ 16 103101 17 100lltl1 18 03111 19 IOll2120

103113 21

10313122

i 10-31 J) 23

i i03I3J24

1031)525

1031)9 1 103146 2

jO3UO 3


1131221

1011222

103442 23

10 24

1103451 25


A Thats correct

















I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6

I


Page 45

-






















A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6












A Yes

















vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6





vs ) )


Defendant



COUNTY OF SEDGWICK











counsel


APPENDIX II

1


















2
















3














4







For example











the parent




5



6


















2
















3














4







For example











the parent




5



6
















3














4







For example











the parent




5



6














4







For example











the parent




5



6







For example











the parent




5



6



6

DISTRlCT,··~6,:~,·.;:-:;--· i… · oftheir royalty instruments or Kansas law. Anadarko's...

Documents

Transcript of DISTRlCT,··~6,:~,·.;:-:;--· i… · oftheir royalty instruments or Kansas law. Anadarko's...