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Woman sues to remove Lupo from managing Gasearch



Published: Sat, February 23, 2013 @ 12:10 a.m.

Plaintiff: Defendant cannot effectively manage Gasearch

SEE ALSO: Kasich’s $63B budget plan would tighten fracking rules

By Peter H. Milliken

milliken@vindy.com

YOUNGSTOWN

The federal criminal complaint against Ben Lupo concerning the Jan. 31 discharge of oil-field waste into a storm sewer flowing into a Mahoning River tributary has spilled over into the civil lawsuit arena.

Because of the repercussions from that criminal complaint, Susan A. Faith of Girard, a plaintiff in a civil lawsuit against Lupo, wants Lupo to be removed as acting manager of Gasearch LLC, a gas-marketing company at 2761 Salt Springs Road, which is Lupo’s office address and the site of the discharge.

“Given his present federal charge and admitted wrongdoing, Benedict Lupo is not able to successfully market oil and gas to end users, which are not only oil and gas producers, but also the public at large,” according to a motion filed Wednesday by Faith’s lawyers.

“We will be preparing an appropriate response, and it’ll be decided on the merits, not on newspaper articles,” Lupo’s Akron lawyer, David Bertsch, said of the motion. “You don’t try it in the newspaper,” he said of the civil lawsuit.

The U.S. attorney has charged Lupo with a single criminal count of violating the federal Clean Water Act in what was alleged to have been an intentional nighttime discharge of brine and oil-based drilling mud.

Lupo, 62, of Poland, has pleaded innocent to that charge in federal court.

However, earlier this month, the Ohio Department of Natural Resources ordered one of Lupo’s companies, D&L Energy Inc., to immediately cease all injection-well operations in Ohio. ODNR also revoked the brine-hauling permit of another of his companies, Hardrock Excavating LLC.

According to a U.S. Environmental Protection Agency affidavit supporting the federal criminal charge, Lupo admitted to an Ohio EPA emergency responder that he directed a Hardrock employee to make the Jan. 31 discharge from a storage tank, and Lupo admitted to the same official he had ordered five earlier storage-tank discharges.

Faith is one of 16 plaintiffs in a complex November 2011 civil breach of contract lawsuit against Lupo and three of his companies. That case is now before visiting Judge Thomas J. Pokorny of Mahoning County Common Pleas Court.

When the civil lawsuit was filed, the complaint said Faith owned 49 percent of Gasearch, and Lupo, 2 percent. It also said Faith had a 51 percent interest, and Lupo, a 49 percent interest, in Hardrock. “Susan Faith had absolutely nothing to do with the illegal waste dumping,” according to the motion to remove Lupo as Gasearch manager.

The lawsuit alleges that, in the summer of 2011, Lupo began taking over management of Gasearch and other companies “for his own benefit and in breach of his fiduciary duties to such companies and without consultation with Susan Faith.”

In October 2011, Lupo barred Faith from the Salt Springs Road premises and told her she was terminated as president of D&L, the company that operated an injection well near the premises.

The ODNR shut down that well last year after a series of earthquakes were linked to it.

The lawsuit says Lupo owns 85 percent of D&L, which he manages, and Faith owns 15 percent of it.

“Benedict Lupo should not be permitted to run Gasearch LLC into the ground, as he already has Hardrock Excavating LLC,” according to the motion to remove Lupo as Gasearch’s acting manager.

“Benedict Lupo has given a black eye, not only to the companies he owns and manages, but also to the oil and gas industry in general. There is no way in which Benedict Lupo can effectively run his companies, or protect the interests of his innocent investors and employees,” the motion says.

Keeping Lupo in charge of Gasearch now that he “has become a lightning rod for all that is perceived to be wrong in the oil and gas industry, is tantamount to a company death sentence,” Faith’s motion says.

Judge Pokorny has not yet ruled on the motion.

The next pretrial hearing in the civil case is scheduled for 1:30 p.m. Friday.


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