Deutsch Energy Co. v. Sherman Mazur Richard Wall Jerome Weiner New Century Energy Corp. New Century Oil & Gas Supply Corp. Jack Ralston

Deutsch Energy Company (“DEC”) appeals from the district court’s grant of summary judgment in favor of defendants Sherman Mazur, Gerald Weiner, New Century Energy Corporation (“NCEC”), New Century Oil and Gas Supply Corporation (“NCOGSC”), and New Century Oil and Gas Supply Corporation Income Development Program 1982-1983 (“Program”), and dismissal of its complaint against the remaining defendants, Richard Wall, Jack Ralston, Courtney Ralston, and Sand Dollar Energy Corporation (“Sand Dollar”). We find that no genuine issue of material fact exists as to whether the transaction among the parties constitutes a security because there was no expectation that profits would be derived solely from the efforts of individuals other than the investors. Accordingly, we affirm the district court’s grant of summary judgment.

BACKGROUND

In April 1981, defendants Mazur and Weiner formed NCEC, a California corporation, to acquire oil and gas producing properties. NCEC subsequently purchased the mineral and extraction rights over a 400-acre parcel located in Kansas referred to as the “Morton Lease.” At the time of the purchase, twenty-two wells had been drilled and were operating on the…