The Superior Court of Pennsylvania recently sided with a lessee in a class action royalty dispute. In Hall v. CNX Gas Co., LLC, the lease contained a royalty provision providing that royalties were to be calculated on the net amount realized at the point of sale. The lessors asserted that because the provision did not authorize the pro rata allocation of lost and used gas among lessors, CNX was limited to deducting only actual volumes of lost or used gas from each lessor’s share when calculating royalties. CNX maintained that there was no volume of lost or used gas to allocate at the point of sale. The court agreed, holding that even though the lease was silent as to the allocation of lost and used gas, the language of the royalty provision obviated the need for an express term addressing the subject. The court reasoned that lost and used gas was not a part of the royalty calculation since the royalty calculation was based on the net amount realized at the point
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