Miller shareholder case nears conclusion

A federal judge in Tennessee has granted preliminary approval of a financial settlement between Miller Energy Resources Inc. and some of its shareholders.

The settlement would resolve lawsuits investors filed after Miller’s stock price tanked in 2011. The suits were consolidated into a single case, with the Oklahoma Firefighters Pension and Retirement System designated as lead plaintiff.

The shareholders alleged Miller executives overstated the value of Alaska oil and gas assets acquired in 2009, and violated accounting principles. This had the effect of artificially inflating the price of Miller’s stock, with investors suffering losses after the fraud was exposed, the plaintiffs alleged.

Miller denied misleading investors and defended its asset valuation.

In July, Miller said it had reached a reached a settlement of the class-action case. The settlement involves a payout of $2.95 million, with the money coming from the company’s insurer, Miller said. Now lawyers are working through the details of notifying potential claimants and finalizing the settlement.

A “final fairness hearing” on the proposed settlement is scheduled for Feb. 3 in U.S. District Court in Knoxville, where Miller is headquartered.

Judge Thomas A. Varlan preliminarily approved the settlement in an Oct. 8 order.

The judge certified a class consisting of “all persons and entities who purchased or otherwise acquired shares of common stock of Miller during the period between December 16, 2009 and through and including August 8, 2011, inclusive, and who were damaged thereby.”

The case number is 3:11-cv-386.

Miller Energy trades on the New York Stock Exchange. The company, through its Anchorage-based subsidiary Cook Inlet Energy LLC, operates a number of producing oil and gas properties in Alaska including the Osprey offshore platform, the West McArthur River oil field, and the North Fork natural gas field.

- Wesley Loy