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Texas Jury Awards Client Antero Resources $11.9 Million in Kickback and Bribery Trial

June 2022

Quinn Emanuel client Antero Resources Corp. is one of the largest natural gas operators in the country. Since 2010, Antero focused primarily on its natural gas operations in West Virginia. During the relevant time, Defendant John Kawcak had total operational control in West Virginia, including the authority to hire the vendors that Antero used to complete wells, and he was otherwise in charge of the over $1 billion that Antero was spending on operations.

Between 2012 to 2015, Kawcak took bribes and kickbacks from a vendor named Tommy Robertson. Those bribes and kickbacks included $729,000 in cash transfers and a free private jet. Shortly after receiving those bribes and kickbacks, Kawcak made Robertson’s companies the sole or preferred vendor for some of Antero’s most important operations, including a particular operation called “frac plug drill outs.” Kawcak pushed out the professional companies that had previously been providing drill outs and installed Robertson’s companies as the drill out providers. The data showed that Robertson’s companies inflated their billings by delaying operations through a combination of intentional misconduct and downright shoddy performance. When comparing the performance of the Robertson companies to the vendors that Kawcak pushed out, the Robertson companies took roughly twice as long to perform operations. These delays ultimately cost Antero roughly $11 million in inflated payments to Robertson’s companies.

Kawcak and Robertson stonewalled Antero’s attempts to uncover the existence of the kickback and bribery scheme, which Antero did not even become aware of until a year into the litigation. Originally, this case began as a simple overbilling case based on the Robertson companies charging Antero a price that exceeded the agreed-upon price on a “price list.” Antero suspected Kawcak’s corruption after holding interviews with over 20 “wellsite managers,” who were the Antero personnel that supervised operations on each individual wellsite. Nearly every person with whom the Quinn Emanuel team spoke advised that the firm should further investigate the relationship between Kawcak and Robertson because they all suspected some type of improper relationship between the two based on the preferential treatment that Robertson’s companies received despite their substandard work.

After prevailing on at least six motions to compel and multiple motions to enforce, Antero finally uncovered the scope of Kawcak’s corruption. On top of the secret bribes and kickbacks, Antero further learned that Kawcak manipulated Antero’s invoice verification system to ensure that invoices from Robertson’s companies avoided review from Antero’s senior executives. Moreover, Kawcak gave an order that any wellsite manager that questioned or otherwise refused to approve a bill from the Robertson companies would be terminated.

The Quinn Emanuel trial team focused heavily on the bribes and kickbacks as well as Kawcak’s shifting explanations for the payments and benefits, which defied all reality. For example, when questioned with evidence that Kawcak never paid any value for the private jet, he responded that he paid for it with $300,000 in cash that was just sitting around his house. When asked why his financial records never showed any withdrawals that corresponded to the $300,000, Kawcak claimed that the $300,000 was the product of weekly $500 ATM withdrawals that had been going on for 20 years. Because the case largely hinged on his credibility, Kawcak’s inability to offer any remotely credible explanation for the payments and benefits was a driving factor in why Antero prevailed and the jury awarded roughly $12 million against an individual employee.