Marcellus Shale boom has pressed law firms to boost their staffs, but experts are in short supply
The same year Bill Caroselli finished law school, Bob Dylan first told the world that the times were a-changin'.
A half-century later, the birth of the multibillion-dollar Marcellus Shale industry has transformed the region's legal landscape, pushing lawyers like Mr. Caroselli to practice oil and gas law after decades of specialization in other fields.
Firms that already had oil and gas practices are making them bigger. Firms that didn't have a practice are rushing to create one. Small firms and solo practitioners are also catching up, hoping to represent landowners as Big Law allies with the gas companies.
"All of us were taught property rights and real estate when we were in law school, but haven't really thought about those issues for 20, 30, 40 years," Mr. Caroselli said. "So it's a whole new mindset for what you have to do."
A partner at Pittsburgh's Caroselli, Beachler, McTiernan & Conboy LLC, Mr. Caroselli specializes in fields like personal injury and malpractice law. Now, his practice also represents landowners in legal encounters with the natural gas companies entering the area to drill.
"Just keep reading," he said. "I keep reading statutes, I keep reading articles, I keep reading what the Legislature is doing, and that's what you have to do to stay current."
Staying current is particularly important to Mr. Caroselli and his clients because the lawyers on the other side of the table almost always have more experience in oil and gas law, the body of law that contains most legal issues emerging from development in the Marcellus Shale region and the adjacent Utica Shale.
One of those industry veterans is Michael Joy, who moved to Pittsburgh last month to join law firm Reed Smith. In addition to a law degree, Mr. Joy has a doctorate in geology.
"As a lawyer, I can fundamentally understand what my clients are trying to do," he said. "That has been immensely helpful to me."
Mr. Joy has been practicing gas law since graduating from school 10 years ago.
The area's largest law firms, which represent natural gas companies rather than local landowners, are recruiting lawyers from across the country with his type of resume. Reed Smith has 16 lawyers working on its oil and gas team.
Mr. Joy also taught an oil and gas law course at Buffalo Law School. Buffalo was the first school east of the Mississippi to offer a course on the subject, he said. As the industry moved from New York to Western Pennsylvania, Pittsburgh's law schools have augmented their curriculum.
Kevin Abbott, who is teaching Pitt's first course on the subject this year, is one of the rare local experts. A colleague of Mr. Joy's at Reed Smith, he has been practicing oil and gas law in Pittsburgh for 30 years.
"When I started practicing oil and gas law, you could've had all the oil and gas lawyers in Pittsburgh meet in my office. There just weren't that many people doing it," he said.
"With Marcellus development and now Utica, this has become such a hub for energy law that somehow the void had to be filled. With the industry stemming around Pittsburgh, it made sense for Pitt to have an oil and gas class, and to get some of our young lawyers in the business."
Oil and gas lawyers are the only in-demand specialists in an otherwise-stagnant legal community, Mr. Joy said.
"That's not just regionally; that's on a national level," he said. "And Pittsburgh is probably the largest market for oil and gas lawyers in the country."
But there are hundreds of lawyers already out of law school looking to learn oil and gas law. For them, the nonprofit Pennsylvania Bar Institute will be in town next month to help.
Stephen Saunders runs an oil and gas law practice out of Scranton, but is going on a four-city tour of Pennsylvania next month to teach a fundamentals course to attorneys.
"In the last three or four years, the initial wave of work surrounded negotiating gas leases," Mr. Saunders said. "There were a lot of attorneys who had general practices or real estate practices and looked at lease negotiations as simply contract law.
"The theory was, 'Hey, I've been working with contracts my whole career. How difficult can it be?' But there's a lot more to oil and gas law than just negotiating leases."
As gas companies continue to obtain leases, legal needs will shift from lease negotiations to parts of the law that actually involve the use of the land, Mr. Saunders said.
Those areas -- including environmental law, permitting compliance, toxic tort actions, regulatory compliance and mineral rights disputes -- will be the focus of next month's course. Including a simulcast of the seminar, the Bar Institute expects about 300 Pennsylvania lawyers to attend.
The program will include a lecture about malpractice issues.
"One of the big message we'll convey is this isn't an area in which people should dabble," Mr. Saunders said. "It takes a lot of work to learn any area of law, and people who want to practice in this area for a career really need to be willing to put in the time to learn the full scale of oil and gas law."
While small firms and solo practitioners adjust to the new legal landscape, larger firms are providing their own in-house training when necessary.
When Kevin Colosimo was a student at Duquesne Law School, chances are he didn't even know what Marcellus Shale was. Fifteen years later, he's working for Burleson LLP
"I did a fair amount of mining and minerals stuff, but my background's in commercial litigation," he said.
The only law firm that operates in every shale basin in the country, Texas-based Burleson practices exclusively oil and gas law. It hired Mr. Colosimo to form a Pittsburgh team in 2010.
Since then, he has hired 33 lawyers and eight other staffers. But with a limited number of oil and gas experts licensed to practice in Pennsylvania, Mr. Colosimo had to look for lawyers from different backgrounds.
"I went for people with traditional real estate experience. From there, we developed the model. We send our lawyers through an oil and gas training program that either involves spending time in our office in Houston or bringing trainers from Houston up here."
The program involves about 40 hours of training, followed by a mentoring program with a more experienced lawyer. A neophyte will be ready to work on his own within a few months.
At K&L Gates, the oil and gas team has expanded over the past five years from three or four lawyers to about 45 who spend a significant amount of time in the field. Five of the firm's lawyers are registered lobbyists.
The firm is awaiting the arrival of the region's first ethane cracker and the legal needs it will produce. A cracker is a refinery that converts raw natural gas into usable products such as ethylene, which is used to produce plastics.
"A cracker will be in operation for 30 to 40 years," said Michael Zanic, the firm's practice area leader in energy, infrastructure and resources. "With thousands of workers involved in the manufacturing process, that's a tremendous economic boom for the industry, and a cracker will bring the plastics industry and other industries."
Lawyers who practice environmental, permitting and labor law will all be in demand as producers move into the area.
K&L Gates also plans to host a natural gas seminar next month, but instead of targeting lawyers, the lessons will be for business leaders from the industry itself.
Buchanan Ingersoll & Rooney PC has added more than 20 lawyers to its oil and gas team in the past two years, said Sean Moran, co-chair of the firm's Energy Section and Oil & Gas Practice Group.
The large firm's team of 80 energy lawyers -- spread throughout Pittsburgh, Harrisburg, Philadelphia and Washington, D.C. ---- has been involved in about $15 billion of gas law transactions over the past few years, he said.
First Published February 13, 2012 12:00 am