09.01.13 8:45 AM ET
Can You Silence a Child? Inside the Hallowich Case
For anyone who lives near a natural gas shale, the story of the Hallowich family of Washington County, Pennsylvania, is a familiar one. It begins with a knock on the door from a representative from a multi-billion dollar natural gas company offering an enticing sum of money in exchange for the mineral rights to the land. Then comes the drilling, followed by reports of headaches, or nosebleeds, or worse. Then the legal fees. Then silence.
What’s not familiar in the case is what may have happened to Chris and Stephanie Hallowich’s children.
The Hallowiches's dream home, which they built on ten acres of land in southwestern Pennsylvania, sat atop the site of one of the biggest fracking operations in the country: the Marcellus Shale. A sedimentary rock that runs thousands of feet below ground from upstate New York through Pennsylvania, parts of Ohio, and into West Virginia, its millions of years’ worth of decomposition creating so-called natural gas, the Marcellus Shale is currently on track to produce the gas equivalent of about 550 million barrels of oil this year alone. In the Hallowiches' case, it was the previous owner of their property who had cut several deals to cash in on this underground resource. The gas processing plant, compressor station, underground pipelines, three-acre plastic-lined holding pond, and four natural gas wells that sprouted up around the Hallowiches’ two-story house as a result of these deals soon became more health hazard than eyesore, the family says.
After opposing the fracking industry for years—accusing the businesses that had set up shop on their land of contaminating their air and water, making them and their small children sick, and devaluing their property—the Hallowiches sued the companies Range Resources, MarkWest Energy and Williams Gas/Laurel Mountain Midstream. Without accepting responsibility for the family’s health claims, the gas companies agreed to pay the Hallowiches $750,000 so that the family could move out—in exchange for their signatures on a non-disclosure agreement.
Such agreements aren’t uncommon outcomes for these types of suits, neither is having the details of the settlement sealed, as this one was. But two years after being barred from attending the Hallowiches’ settlement hearing, the Pittsburgh Post-Gazette requested that the court release a transcript and discovered something odd. By signing the agreement, it appeared that Chris and Stephanie were not only promising never to speak about Marcellus Shale gas drilling or any of the companies with which they settled—they were also ostensibly vowing that their 7 and 10-year-old children would keep their mouths shut about fracking. Forever.
Two years after their suit was settled, the unsealed transcript thrust the Hallowiches into national news headlines, symbolizing the apparent lengths to which corporations would go to keep adversaries quiet. At least one of the companies jolted into damage control mode, sending a letter to a Hallowich family lawyer insisting that, contrary to what was said in the hearing, it "has never, at any time, had the intention of seeking to hold a minor child legally accountable for a breach of that provision of the settlement agreement.”
But the companies' intention and the actual effect on the children are two different things—both of which continue to be debated.
Hydraulic fracturing, or fracking, is still somewhat of a mystery to most of the country. It’s probably best identified as what Matt Damon’s character tries to push on a small Pennsylvania farming town in the 2012 film Promised Land. Or it’s what (arguably) caused a Colorado man to light his tap water on fire two years earlier in the Academy Award-nominated documentary Gasland.
Though fracking has been around for well over 65 years, it wasn’t until the method of injecting water, sand, and chemicals into the ground to break up oil and rock formations was introduced on an industrial scale in the U.S. that the process became newsworthy. In the past 25 years, with the discovery of gas-rich shales and the introduction of industrial fracking, shale gas production has gone from zero to 23 percent of all U.S. gas production. That percentage is predicted to balloon to 49 percent by 2035, moving the U.S. closer to its universally endorsed goal of “ending our dependence on foreign oil.” When President Obama says he wants to boost natural gas exports from the U.S., he’s talking about fracking.
Douglas Shields, a former Pittsburgh City Councilman who passed a ban on fracking for Pittsburgh in 2010, says he first started getting calls from constituents who’d been offered cash for their mineral rights in 2008. Shields had been around the gas industry his entire life—from working on an oil field boat in the Gulf of Mexico in 1974 to building a legal career in environmental and regulatory law—and Pennsylvania has had a long history of gas drilling. So when gas companies promised to bring business back to a state that had been in decline since the end of the industrial era, most people, including Shields, were excited.
But Pennsylvanians, as well as people sitting on natural gas shales around the country, would soon discover that fracking is unlike anything they’d ever encountered before. By the time Stephanie Hallowich and others complained of headaches and nosebleeds and contaminated water, Shields says, “it was too late for anyone to do anything politically effective.”
The research on the health impacts of fracking is mixed and relatively limited. According to a recent National Institutes of Health Environmental Health Science podcast, it’s clear to scientists who’ve studied fracking that the process emits chemicals into the air and possibly water. What’s unclear is the amount of chemicals that are released and the extent to which people might be exposed. Back in May the Obama Administration unveiled new fracking regulations that require companies to disclose which chemicals are used in the process and to have management plans in place to ensure that contaminated liquids don’t make their way into groundwater. And while some in the oil and gas industry like Chevron CEO John Watson have come out in favor of stricter fracking restrictions to mitigate risks, many others maintain that the practice is not responsible for air and water contamination or the health issues that could cause.
Attorney Mark Bern estimates that there have been somewhere between 50 and 100 civil lawsuits against natural gas companies just like the Hallowiches’—his Chicago-based firm Napoli Bern Ripka Shkolnik LLP has handled about 40 of them—and he predicts that number will only continue to grow. “The litigation is still very young, partially because all of this fracking has happened so fast throughout the country,” Bern told The Daily Beast. “Even though there has been a lot of contamination, I don’t believe it will really manifest itself for another 10 to 20 years because we won’t be drinking water from many of the aquifers that have been contaminated for that long.”
Have the Hallowich kids really been gagged? The court transcript in the case reveals a hearing wrought with confusion over the settlement’s implications for Chris and Stephanie Hallowich's children. Peter Villari, the family’s attorney, notes that he has never seen a request to silence minor in his 30 years of practicing law. In the transcript, he repeatedly asks Chris and Stephanie Hallowich if they understand that by signing the agreement they may be giving up the First Amendment rights of their child—if that’s possible. They question how they were to be expected to control what their children say when out from under their supervision.
James C. Swetz, the attorney representing Range Resources at the hearing, is quoted saying that “the Hallowiches are defined as the whole family. That’s the way the contract has been written. That’s what we’ve agreed to.” The judge states flatly that he doesn’t know whether parents could make such a promise on behalf of their children, calling it “a law school question.” Swetz doubles down, clarifying, “I guess our position is that it does apply to the whole family. We would certainly enforce it.”
Gabe Rottman, a free speech expert at the American Civil Liberties Union, is concerned about the constitutionality of such an agreement. “They can’t comment on Marcellus Shale or fracking at all, ever,” Rottman said in an email to The Daily Beast. (Emphasis his.) “Aside from the contract law issues, I would argue that’s unenforceable as a violation of the First Amendment. This would cover speech that has little or nothing to do with the terms of the agreement between the company and the Hallowiches.” Rottman also pointed out that children have the right to disaffirm a contract they’re entered into before they turn 18. He says they should do that.
Bern, however, says the answer to this question is simple: the Hallowich kids, like all children included in a lawsuit settled with any kind of major corporation, are most likely bound by the agreement. Minors can’t sign settlements, but they are often plaintiffs in these types of suits, with their parents arguing for them that drilling made them sick or created an unsafe environment for them to live. Trials, Bern explained, make cases public. So if corporations don’t want to open themselves up to bad press or future lawsuits, they will settle out of court and insist on a non-disclosure agreement. Generally, he said, those who sign “are bound forever.”
Pittsburgh’s Douglas Shields called this “an extortion process” but added, “I don’t blame anyone in these circumstances for taking the money and getting the hell out.”
“You’re giving me goose bumps,” says Jane, who spoke to The Daily Beast under the condition of anonymity, when asked about the idea of permanently prohibiting her two children from talking about fracking. “Oh, that’s sick.” She says she, her husband, and their two kids were lucky enough to get the hell out.
They didn’t lease their land to the gas company that came to their small Colorado town because they didn’t own the mineral rights to their property. But the neighbors did. And two weeks after fracking began on the land around her house, Jane says, “our water went bad.”
Jane and her husband sued the drilling company that had paid the neighbors to frack on their land, claiming the fumes and chemicals emitted by the company’s rigs had caused the family nosebleeds, blackouts, rashes, constant coughing, and other illnesses. Their case was initially dismissed, but just last month—with the help of Bern’s firm—they won an appeal. And they didn’t have to sign a non-disclosure agreement—though she knows people who’ve had to.
While Jane is certain that she and her family haven’t gotten any sicker since they had to do a constructive eviction—in which a home is declared uninhabitable—and move towns, she says their health is still suffering. “I’m really worried about our children’s future, what they’ve been exposed to,” she said. Still, it’s hard for her to say what she would have done in the Hallowiches’ position. “We’ve always said from day one we want to let people know what’s happening so it happens to as few people as possible,” she said.
It’s been weeks since the Hallowiches’ court transcripts were released, and Range Resources's communications director Matt Pitzarella objects strongly to the way the story has played out. “To be very clear, the agreement was never intended to be applied to the elementary school aged children,” he wrote in an email to The Daily Beast. “The agreement begins by mentioning the names of the children only once, because they were named in the lawsuit. But matters like the real estate covenant, nondisclosure, and those matters are all clearly in reference to the parents.”
Pitzarella referred to Swetz’s comment that the order would apply to the entire family and be enforced as “one of several made by a former outside counsel to Range, who never informed us of the questions surrounding the children. When we learned of it, we immediately sent a letter to the plaintiff’s attorney.” Swetz is no longer employed by the prestigious law firm K&L Gates, where he was working at the time of the Hallowich hearing. He’s also no longer representing Range Resources. When asked if the outcome of the case had anything to do with this, Pitzarella replied, “We were unsatisfied with many aspects of the handling of the settlement.” The Daily Beast made multiple unsuccessful attempts to reach Swetz. (Requests to Williams Gas/Laurel Mountain Midstream were unreturned as well. MarkWest Energy declined to comment.)
Hallowich lawyer Villari doesn’t deny receiving the letter, but he isn’t buying any of it. “There was no doubt in anyone’s mind that the moment [Swetz] opened his mouth he was speaking on Range’s behalf. He did what he was hired to do.” Villari said that he sent a letter in response to Range Resources, MarkWest Energy and Williams Gas/Laurel Mountain Midstream—the companies involved in the original settlement agreement—inviting all of them to enter into a joint stipulation withdrawing the gag order against the children. No one has responded. In fact, other than Range Resources, the rest of the defendants in the agreement have, like the Hallowiches, remained silent.
Corrections: The original version of this article incorrectly cited the amount of natural gas the Marcellus Shale is on track to produce this year. It also stated that the Hallowiches weren't aware that their home sat atop a fracking operation; court records show the family was aware that the previous owner had leased natural gas rights.