New Bankruptcy Opinion: FORTUNE NATURAL RESOURCES CORPORATION v. UNITED STATES DEPARTMENT OF INTERIOR – Court of Appeals, 5th Circuit, 2015





FORTUNE NATURAL RESOURCES CORPORATION, Appellant,

v.

UNITED STATES DEPARTMENT OF INTERIOR; ATP OIL & GAS CORPORATION, Appellees.

No. 15-20151.

United States Court of Appeals, Fifth Circuit.

Filed November 19, 2015.

Before: STEWART, Chief Judge, and CLEMENT and ELROD, Circuit Judges.

EDITH BROWN CLEMENT, Circuit Judge.

Fortune Natural Resources Corporation (“Fortune”) owns a percentage working interest in a lease with ATP Oil & Gas Corporation (“ATP”), who filed for bankruptcy. [1] Fortune asserted a claim in ATP’s bankruptcy proceedings for decommissioning costs related to the lease. ATP sought and received approval from the bankruptcy court—over Fortune’s objection—to sell certain shelf and deepwater assets. The Final Sale Order was not stayed, and the sale closed. Fortune appealed the Final Sale Order to the district court. The district court dismissed the appeal, holding that Fortune lacked standing to appeal the bankruptcy court’s ruling and that, in any event, the appeal was statutorily moot. Fortune appeals this dismissal order contending that it has standing to appeal and that the appeal is not moot. Because Fortune has failed to prove that it was directly and adversely affected pecuniarily by the ruling of the bankruptcy court, it lacks standing to appeal, and we AFFIRM.

I.

ATP, a former offshore oil and gas exploration and production operator on the Outer Continental Shelf in the Gulf of Mexico, filed for bankruptcy relief on August 17, 2012. Fortune owned a 12.5 percent working interest in a lease that was considered one of ATP’s assets (the “Fortune Lease” or “Lease”). Fortune and ATP were parties to a Joint Operating Agreement, which mandated that any plugging and abandonment operations be accomplished by ATP, as operator, with the costs, risk, and net proceeds, if any, to be shared by co-lessees in proportion to their participating interests. The Fortune Lease terminated on November 11, 2010. As a result, ATP was required to conduct decommissioning operations on two wells,

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