Robbins Geller Secures $40 Million for Cabot Oil Investors in Securities Fraud Suit

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July 9, 2024

A federal court gave preliminary approval to a $40 million investor recovery in a long-running securities fraud class action case against Cabot Oil & Gas Corporation (now Cottera Energy Inc.). United States District Court Judge Lee H. Rosenthal of the Southern District of Texas will hold a hearing to consider final approval of the settlement in October 2024.

The Case Against Cabot Oil

Cabot Oil develops and exploits oil and gas properties in Susquehanna County, Pennsylvania and elsewhere. Investors alleged that Cabot and certain senior executives were aware that the company’s fracking and gas extraction operations violated environmental law and that Cabot failed to remediate faulty wells. Nevertheless, the lawsuit alleges that defendants misrepresented the company’s compliance with its environmental and remediation obligations.

In June 2020, the Pennsylvania Office of the Attorney General charged Cabot with 15 criminal charges for repeated violations of environmental law, alleging Cabot had failed to repair faulty gas wells that were leaking methane into residential water supplies of communities surrounding Cabot’s wells. Following a grand jury presentment of charges finding that Cabot “knowingly” violated Pennsylvania laws, the Pennsylvania Attorney General stated that “Cabot took shortcuts that broke the law” and noted that the grand jury “found evidence of a company that placed profits over our laws.”

When Cabot disclosed receiving notices of violations from Pennsylvania regulators and when the criminal charges were announced, the price of Cabot common stock dropped from its artificially inflated price, allegedly causing significant damage to investors.

Investors Secure $40 Million Recovery

Delaware County Employees Retirement System represented the class of investors as lead plaintiff in the securities class action case against Cabot. The court denied Cabot’s motion to dismiss the case in late 2022.

“Delaware County Employees Retirement System’s leadership was the difference in this case. They provided the critical leadership and determination that resulted in a strong recovery for investors harmed by the alleged fraud,” said partner Darryl J. Alvarado, lead counsel for the investors.

Robbins Geller attorneys Darryl J. Alvarado, Kevin A. Lavelle, and Jack Abbey Gephart obtained this result for the class.

About Robbins Geller

Robbins Geller Rudman & Dowd LLP is one of the world’s leading complex litigation firms, representing plaintiffs in securities fraud, shareholder derivative, antitrust, corporate takeover, and consumer fraud and privacy cases. With 200 lawyers in 10 offices, Robbins Geller is one of the world’s largest plaintiffs’ firms, and the Firm’s attorneys have obtained many of the largest securities, antitrust, and consumer class action recoveries in history.

Over the last decade, our Firm has been ranked #1 on the ISS Securities Class Action Services law firm rankings for six out of the last ten years for securing the most monetary relief for investors. In the last four years, Robbins Geller recovered $6.6 billion for investors in securities-related class action cases – over $2.2 billion more than any other law firm during that time. The Firm secured the largest-ever securities fraud class action settlement – $7.2 billion – in In re Enron Corp. Securities Litigation

For media inquiries, please contact media@rgrdlaw.com or call (619) 338-3821.

Delaware County Employees Retirement System v. Cabot Oil & Gas Corporation, No. 4:21-cv-02045 (S.D. Tex.).

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