Monday’s trial is about damages owed to the Osage Minerals Council and is not meant to litigate the issue of whether or not Osage Wind LLC, Enel Kansas and Enel Green Power North America should have gotten a permit or committed continued trespass. Those issues have been settled in previous rulings at the 10th Circuit Court of Appeals in 2017 and in December of 2023.
But both sides seem to be very far apart on what amount is owed and why.
Lawyers for the wind farm companies said they should only be on the hook for $68,993 to $247,979.
The United States Attorney’s office, arguing on behalf of the Osage Minerals Estate, said the amount is much higher. They said the Osage is owed $12,504,918 for trespass damages and $18,603,696 for future operating fees.
However, in a pre-trial order submitted in March, Judge Jennifer Choe-Groves lists something called “trebled” damages that the OMC said it is owed. Trebled is a legal term that basically means tripled.
This is what the U.S. Attorney’s office and Patterson Earnhart Real Bird & Wilson LLP said is the calculation that should be considered to compensate their client. The wind companies’ failure to obtain a lease to erect the 84 turbines, mine and crush rocks and use soil for the base of the turbines and their continued use to keep the wind turbines running.
“For forcibly ejecting or excluding a person from the possession of real property, the measure of damages is three times such a sum as would compensate for the detriment caused to him by the act complained of,” according to the Oklahoma Statute cited by the OMC and the U.S. in the order.
The multiplication or trebling of the damages above would amount to $37,514,754 for trespass damages before trial and $55,811,088 for future operating fees after the trial.
Lawyers for the wind farm companies scoffed at those figures and said both sides agreed on their much lower amount, according to briefs filed on May 13.
“The only issue for trial is the amount of compensatory damages. Specifically, what would OMC have received if Defendants had obtained the lease required by 25 C.F.R. Part 214,” wrote lawyers for Osage Wind LLC, Enel Kansas and Enel Green Power North America.
Those lawyers claim the amount for those damages is based on other leases OMC negotiated.
To compute what the damages are, Enel’s argument is that they could have gone out and bought crushed rock from somebody else and hauled it in and not used the OMC’s rock and this ($68,000-$274,000) is what they would have paid for it.
The expert for the United States, Stephen J. Hazel disagrees and will argue that the way you compute the damages is to look at what the OMC would have agreed to through a voluntary contract. They argue the appropriate amount is similar to what the surface landowner got for the wind farm.
Hazel works at FTI Consulting and has a background in computing damages and assessments and has been an expert witness in state and federal courts.
Lawyer for the wind farm companies said Hazel is not an appropriate expert to call and instead relies on their own, John Pfahl, a mining industry expert; and Kimberly Centerra, who has worked in the field of wind farm development.
“Mr. Hazel’s opinion is irrelevant here and the Court should give it no weight. He has no experience with the terms a wind energy developer might negotiate with a mineral rights holder; the theories underlying his conclusions have been rejected by the Court; and his central contention that the mineral estate was ‘at least as integral’ to the construction of the Osage Wind project as the surface estate is contrary to market reality and the facts of this case,” wrote the defendants’ lawyers in their pre-trial brief.
The United States brief lists Oklahoma Statute 23 section 71 which allows for damages to be trebled based on invading someone’s property.
“This statute allows treble damages if exclusion of the rightful owners (Plaintiffs) was accomplished by ‘force.’ The ‘active force’ of massive dynamite blasts across 82 turbine sites coupled with the scale of the wind farm’s construction project demonstrates not only the application of considerable force, but an obvious oppressive intent. By Defendants’ own estimates, removal of the structures placed by Defendants will cost millions and require a year’s work,” wrote Nolan Fields of the United States Attorney’s office.
Defendants said they didn’t use force or act out of malice. Instead, they continued to maintain they needed no lease to construct turbines on the OME.
“Plaintiffs’ attempt to treble their damages under Section 71 of Chapter 23 of the Oklahoma Statutes is equally flawed. To recover under Section 71, Plaintiffs must show both (1) that Defendants acted with ‘malice’ or ‘bad faith,’ and (2) that Defendants dispossessed Plaintiffs from ‘real property’ with ‘violence’ or ‘active force.’ Plaintiffs cannot meet either element. Defendants ‘honestly believed’ they were ‘legally within [their] rights’ in constructing the wind project without a mining lease,” according to the defendants’ pre-trial brief.
Indeed, the Surface Leases provide for a signing bonus, development period rent, exercise of option payment, fees during the construction period, construction payment, pasture damages, and turbine operating fees,” wrote Fields from the U.S. Attorney’s office.
But the U.S. Attorney’s office said the OMC had every right to negotiate a lease similar to what the surface owners had, “the Defendants ran roughshod over the OMC’s trust Indian mineral rights and the United States’ responsibilities regarding them,” wrote Fields from the U.S. Attorney’s office.
The other issue to be decided after this trial is the fate of the wind turbines on the OME.
What happens next? An order may be issued to recover attorney’s fees as well as an order for damages related to the case and ultimately removal of the wind farm, which Osage Wind, Enel Kansas and Enel Green Power North America can appeal. In order to appeal the damages, the judge, similar to the Trump case for financial misdeeds, could issue a bond order for the companies.
There is no timeline for when the judge will rule after the damages trial.
