McCormick v. HRM Resources, LLC

The federal district court for the District of Colorado denied motions to dismiss a lawsuit brought by Colorado landowners who alleged that defendants that had owned orphaned oil and gas wells on the plaintiffs’ property had engaged in fraudulent transfers of the wells to escape the costs of plugging the wells. The court ruled that the plaintiffs did not have to exhaust administrative remedies and rejected the defendants’ argument that the landowners did not have standing. The court found that the plaintiffs pleaded cognizable injury with allegations of trespass, aesthetic injury, exposure to pollutants, and lower property values and also found that the plaintiffs adequately pleaded that the injuries were fairly traceable to the defendants’ allegedly fraudulent scheme of transferring the orphan wells. The court also found that the plaintiffs adequately alleged the elements of a claim under the Colorado Uniform Fraudulent Transfer Act as well as claims of civil conspiracy to commit fraudulent transfer, trespass, conspiracy to commit trespass, aiding and abetting trespass, unjust enrichment, and negligence.