pa state ethics commission settlement with william capouillez

InRe: WilliamCapouillez, : FileDocket: 13-032Respondent : X-ref: OrderNo. 1695-2

DateDecided: 8/10/16DateMailed: 8/11/16

Before: NicholasA. Colafella, ChairMarkR. Corrigan, ViceChairRogerNickMelanieDePalma

ThisisafinaladjudicationoftheStateEthicsCommission.

Procedurally, theInvestigativeDivisionoftheStateEthicsCommissionconductedaninvestigationregardingpossibleviolation(s) ofthePublicOfficialandEmployeeEthicsAct (“EthicsAct”), 65Pa.C.S. § 1101etseq., bytheabove-namedRespondent. Atthecommencementofitsinvestigation, theInvestigativeDivisionserveduponRespondentwrittennoticeofthespecificallegation(s). Uponcompletionofitsinvestigation, theInvestigativeDivisionissuedandserveduponRespondentaFindingsReportidentifiedasan “InvestigativeComplaint.” AnAnswerwasfiledandahearingwasrequested. AStipulationofFindingsandaConsentAgreementweresubsequentlysubmittedbythepartiestotheCommissionforconsideration. TheStipulatedFindingsaresetforthastheFindingsinthisOrder. TheConsentAgreementhasbeenapproved.

I. ALLEGATIONS:

ThatWilliamA. Capouillez, apublicofficial/publicemployeeinhiscapacityastheDirectoroftheBureauofWildlifeHabitatManagementforthePennsylvaniaGameCommission, violated \[Section1103(a)\] oftheStateEthicsAct (Act93of1998) whenheutilizedtheauthorityofhispublicemployment, and/orconfidentialinformationreceivedthroughhisholdingpublicemployment, fortheprivatepecuniarybenefitofhimselfand/orabusinesswithwhichheisassociated, namelyGeologicalAssessmentandLeasingLLC, whenheorganized, negotiated, and/orarrangedleaseagreementswithprivateindustryrepresentativesforOil, GasandMineral (“OGM”) explorationonPennsylvaniaGameCommissiongamelands, whilesimultaneouslyperformingthesameactionsforprivatelandownerswithintheCommonwealthforafee.

II. FINDINGS:

C’ EWHAPOUILLEZS DUCATIONAND ORK ISTORY

1. WilliamA. Capouillez (hereinafter “Mr. Capouillez” or “Capouillez”) wasemployedbythePennsylvaniaGameCommission (hereinafter “PGC”) astheDirectoroftheBureauofWildlifeHabitatManagement (hereinafter “BWHM”) fromapproximatelyDecember2, 2006, throughMay18, 2015.

a. Mr. CapouillezwashiredtoprovidethePGCwithincreasedknowledgeandexperienceregardinggeology—specificallyasitrelatestomineral, oil, andnaturalgasissues. Additionally, hewashiredtobuildaPGCstaffwiththecapabilitytoprovidemaximumprotectiontotheconservationofstatelands

Capouillez, 13-032Page2

andtomaximizeCommonwealthincomederivedfromtimber, mineral, oil, andnaturalgasactivity.

b. Mr. Capouillez’soriginaltitlewasDirectoroftheBureauofLandManagement. (ThePGCchangedthenamefromtheBureauofLandManagementtotheBWHMinoraboutJune2006).

2. Mr. CapouillezobtainedadegreefromPennStateUniversityin1987inthefieldofEarthandMineralScience, withanemphasisongeology.

3. InJanuary1990, Mr. CapouillezbeganworkingforthePennsylvaniaDepartmentofEnvironmental Protection (hereinafter “DEP”) asaGeologistTrainee, andwassubsequentlypromotedtothepositionofHydrogeologist1, effectiveJanuary1991.

4. InApril1993, Mr. CapouillezacceptedalateraltransfertothePGCinhispositionofHydrogeologist1.

5. InApril1994, Mr. Capouillez, onhisowninitiative, obtainedaProfessionalGeologistLicense (LicenseNumberPG000453G) fromtheCommonwealthofPennsylvania, DepartmentofState, BureauofProfessionalandOccupationalAffairs. Thislicenseiscurrentlyinactive.

6. Mr. CapouillezheldvariouspositionsduringhistenurewiththePGC, asfollows:

Hydrogeologist1: April17, 1993 - March8, 1998Hydrogeologist2: March9, 1998 - January14, 2000LicensedProfessionalGeologist: January15, 2000 - May24, 2002EnvironmentalPlanningManager: May25, 2002 - December1, 2006

a. Mr. Capouillez’sclassificationasaHydrogeologist1wasreviewedandupgradedtoaHydrogeologist2effectiveMarch9, 1998.

b. Mr. Capouillez’spositionasaHydrogeologist2wasreclassifiedtoLicensedProfessionalGeologisteffectiveJanuary15, 2000.

c. Mr. CapouillezwaspromotedtoEnvironmentalPlanningManagereffectiveMay25, 2002. AstheEnvironmentalPlanningManager, Mr. CapouillezwastheChiefofthePGCEnvironmentalPlanningandHabitatProtectionDivision.

7. EffectiveDecember2, 2006, Mr. CapouillezwasappointedastheDirectoroftheBureauofLandManagement (currentlytheBWHM).

8. AsaHydrogeologist1, andsubsequentlyasaHydrogeologist2, Mr. Capouillezhadmultipledutiesandresponsibilities, whichincluded, amongothers, oil, gas, andmineralrecovery/leasing.

9. AsaLicensedProfessionalGeologist, Mr. Capouillezhadnospecificwrittenjobdescription.

10. Capouillez’sjobdescriptioninhispositionasanEnvironmentalPlanningManagerforthePGCdocumentedmultipledutiesandresponsibilitieswhichincluded, amongothers, oil, gas, andmineralrecovery.

a. Capouillez’sdutiesandresponsibilitiesinrelationtooil, gas, andmineralrecoveryincluded, amongothers, thefollowing:


1. AdministeringtheCommission’soil, gas, andmineralresourcemanagementprogramaswellasdirectingtheworkoftheenvironmentalplanningandhabitatprotectionunit;

2. AdvisingtheBureauDirectorontechnicalmattersrelatedtooil, gas, andmineralresourcemanagementinthePennsylvaniaGameLandssystem;

3. Planning, implementing, andmonitoringapprovedoil, gas, andmineralleasingprogramsinaccordancewithagencyguidelinesandpolicies;

4. PreparationofformalagendaitemsinvolvingleasingofCommonwealthownedoil, gas, andmineralsforCommissionconsiderationandformalapproval;

5. Preparationofleasesandagreementsinvolvingexplorationfor, andrecoveryofoil, naturalgas, coal, andothermineralsfromlandsownedorcontrolledbytheGameCommission;

6. Receivingdevelopmentrequestsforremovalofprivatelyownedoil, gas, andmineralsfromunderGameLandssurfacewhichrequiresreviewingandanalyzinglegaldocumentsanddeterminationofenvironmentalimplications;

7. Monitoringprogressofleasedevelopmentandanalyzingtechnicalaspectsofmineralrecoveryprojectsforpotentialadverseenvironmentalimpacts;

8. Preparingadvisorymemosandbriefingreportsforregionalofficeandfieldstaffonrecommendedcoursesofactiontobeimplementedatoil, gas, andmineralrecoverysites;

9. Planningandcoordinationofoil, gas, andmineralrecoveryprojectstoinsurecompatibilitywithotherGameLandmanagementprograms;

10. Planningandconductinginternalauditcontrolstoinsurefullpaymentofoil, gas, andmineralproductionroyaltiesduetotheCommission; and

11. Maintainingliaisonwithmajorenergycompanystaffsandnegotiatingdetailsofoil, gas, andmineralleasingprogramswithprivatecompanyrepresentatives.

b. Capouillezwasresponsibleforthesedutiesasassociatedwithoil, gas, andmineralrecoveryfromatleastMay25, 2002, throughDecember1, 2006.

11. Capouillez’smostrecentjobdescriptionforthepositionofDirectoroftheBWHMsetsforthmultipledutiesandresponsibilitiesregardingtheposition.

a. Thedefinitionofthepositionasdocumentedonthejobdescriptionstates:

Thisisadministrativeandmanagerialworkindirectingthestatewidegamelandmanagementprogram.”

b. Dutiesforthepositionasdocumentedonthejobdescriptioninclude, inpart, theadministrativedirectionofthestatewidelandacquisitionandleasing


program, includingtheoil, gas, andmineralrecoveryprogramwhichisincludedwithin/isacomponentofthestatewidelandacquisitionandleasingprogram.

c. CapouillezhasbeenresponsiblefortheadministrativedirectionofthestatewidelandacquisitionandleasingprogramsinceDecember2, 2006.

1. Nospecificduties, responsibilities, actions, etc., tobecompletedareidentifiedinthejobdescriptioninassociationwith “administrativedirection.”

OFPGCPRGANIZATIONAL RAMEWORKOFTHE ANDTHE ROCEDURESFORLOGRSGLEASING ILAND AS IGHTSOF TATE AME ANDS

12. ThePGCwasestablishedbytheStateLegislaturein1895asanindependentpublicwildlifeprotectionagency. ThePGCisgovernedbyaneightMemberBoardofCommissionersthatareselectedbytheGovernorandconfirmedbyamajorityvoteoftheSenate. TheBoardofGameCommissionersisresponsiblefortheprotectionandpreservationofstategame, birds, andmammals, andenforcementofCommonwealthlawsrelatingthereto.

13. TheBWHMisresponsibleformultiplefacetsofoperationsforthePGCincluding, inpart, thefollowing:

a. ManagementofPGClandspurchasedaswellasthoseobtainedthroughcooperativeleasearrangements;

b. Comprehensiveplanningforthedevelopmentofthelandsforwildlifehabitats, timberharvests, andremovalofoil, gas, and/orminerals; and

c. Directmanagementofapproximately1.4millionacresofStateGameLandshereinafter “SGL”) andassistingwithanadditionalapproximate3million

acresofprivatelandenrolledintheagency’sPublicAccessProgram.

14. Alloil, gas, andmineral (hereinafter “OGM”) leasingofassetsownedandmanagedbythePGCmustadheretospecificPGCpolicyandstateregulationsrequiringthatsuchleasingbebasedonsoundwildlifemanagementprinciplesandwillnotinvolveanylongtermimpactonwildlifeorthewildlifedevelopmentprogram. SeePGCPolicySection6211.211-214; seealsoTitle34, ChapterSevenoftheGameandWildlifeCode (shorttitle).

15. TheleasingofOGMrightsonPGCSGLfortheOGMrightscontainedthereinmaybeaccomplishedviaa “publicbid” or “solesource” process.

16. The leasingofPGCSGLfortheOGMrightscontainedthereinviapublicbid1processgenerallyfollowsthestepsidentifiedbelow:

a. OGMsectionoftheEnvironmentalPlanningandHabitatProtectionDivisionpreparestheleasemap, lease, andbidpackage.

b. BWHMDirectorreviewstheapplicablebidpackagetodetermineifanycorrections/changesareneeded.

1However, theorigination, negotiation, andcompletionofleasesofPGClandstypicallybeganwithandwasadministeredbyPGCpersonnelnotwithintheBWHM. SomeleaseactivitieswerehandledoutsidetheBWHMentirely, includingthoserelatingtotrespassandwrongfultakingofOGMresources.


c. Ifnocorrections/changesarerequired, thePGCCommissionersareformallynotifiedofthepotentialbidandforwardedacopyoftheleasemapandsitespecificdrillingorminingrestrictions.

d. IftheCommissionersapprovemovingforwardwiththeprocess, theOGMSectionpreparespublicnoticeofthepotentialbidareatobeadvertisedinatleasttwolocalnewspapersforthreeconsecutiveweekswithallrequests, commentsorconcerns, tobefullyaddressed.

e. TheOGMSectionsubsequentlysendspersonalwrittenbidinvitationsandbidpackagestoprobablebidders.

f. InterestedbiddersprepareandsubmitbidswhichareopenedbyrepresentativesofOGMSectionwiththehighestbidderrecommendedforawardofthelease.

g. TheOGMSectionpreparesthecommentaryregardingthepotentialleaseasanagendaitemwhichisthenscheduledforreviewandapprovaloftheExecutiveOffice, tobeplacedinthefinalagendaforameetingofthePGCBoardofCommissioners, whichentityalonehastheauthoritytoapproveorrejectanyleaseofGameLands.

1. IftheleasereceivesBoardapproval, theOGMSectionpreparestheleaseandforwardsthesuccessfulbidderthefinalizedagreementforsignature.

2. IftheBoarddoesnotapprovethelease, theprocessisterminated.

h. Uponsignaturebythesuccessfulbidder, theOGMSection, whichwassupervisedbyMr. Capouillez, forwardstheleasetotheChiefCounselofthePGCforreview, signature, andapproval, thentothePGCExecutiveDirectorforreview, signature, andapproval, thentotheCommonwealth’sAttorneyGeneral, forreview, signature, andapproval.

i. PGCHarrisburgpersonnelandregionalpersonnelmustconductameetingwiththeoil/gasorminingcompanytoreviewallleasetermsandconditionswithfullyexecutedleasecopiestobegiventoallappropriatepartiestoinclude: lessee, PGCregionalpersonnel, andPGCHarrisburgpersonnel.

j. PeriodicfieldreviewsareconductedbyPGCpersonnelandDepartmentofEnvironmentalProtectionpersonnel (BureauofOilandGasorMining) toensurecompliancewithallapplicablestateandfederalregulationsgoverningoil/gasorminingoperations.

17. TheleasingofOGMrightsonPGCSGL pursuanttoasolesourceprocessgenerallyfollowsthestepsidentifiedbelow:

a. PGCsectionoftheEnvironmentalPlanningandHabitatProtectionDivisioncalculatesandnegotiatesleaselanguage, terms, fees, andbonding.

b. IftheapplicantagreeswiththetermsaspresentedbytheOGMSection, theleaseispresentedtotheBWHMDirectorforreview.

c. IftheformoftheleaseisfoundappropriatebytheBWHMDirector, theOGMSectionpreparesandsendsaconditionedcommitmentlettertotheapplicantforsignature.


d. Uponreceiptofthesignedcommitmentletterfromtheapplicant, theOGMSectionpreparestheleasecommentaryasanagendaitemwhichisthenscheduledforreviewandapprovaloftheExecutiveOffice, tobeplacedinthefinalagendaforameetingofthePGCBoardofCommissionersforfundapproval.

1. IftheleasereceivesBoardapproval, theOGMSectionforwardsthesuccessfulbidderthefinalizedagreementforsignature.

2. IftheBoarddoesnotapprove, theleasingprocessisterminatedandnoOGMleaseisentered.

e. Uponsignaturebythesuccessfulbidder, theOGMSection, supervisedbyMr. Capouillez, forwardstheleasetotheChiefCounselofthePGCforreview, signature, andapproval, thentothePGCExecutiveDirectorforreview, signature, andapproval, thentotheCommonwealth’sAttorneyGeneral, forreview, signature, andapproval.

f. OnceapprovedforlegalitybythePGC’sChiefCounselandsignedbytheExecutiveDirector, theleasetermsandconditionsaretobeapprovedforlegalitybytheOfficeofAttorneyGeneral.

g. PGCHarrisburgpersonnelandregionalpersonnelaretoconductameetingwiththeoil/gasorminingcompanytoreviewallleasetermsandconditionswithfullyexecutedleasecopiestobegiventoallappropriatepartiestoinclude: lessee, PGCregionalpersonnel, andPGCHarrisburgpersonnel.

h. PeriodicfieldreviewsaretobeconductedbyPGCpersonnelandDepartmentofEnvironmentalProtectionpersonnel (BureauofOilandGasorMining) toensurecompliancewithallapplicablestateandfederalregulationsgoverningoil/gasorminingoperations.

18. Mr. Capouillez’spositionasBWHMDirectorincludedresponsibilitiesandauthorityintheleasingprocesses, specifically:

a. Inthepublicbidprocess, theBWHMDirectorisresponsiblefordeterminingifOGMstandardoperatingproceduresandOGMpolicyhavebeenmetorifcorrectionstothebidpackagearerequired.

1. Ifcorrectionsarerequired, thepackageissenttotheOGMSectionforchanges.

b. Inthesolesourceprocess, theBWHMDirectorisresponsiblefordeterminingifOGMstandardoperatingproceduresandOGMpolicyhavebeenmet, ifthepotentialleaseshouldbeconsideredforfurtherprocessing, orifthetermsoftheleaseshouldbemodifiedthroughthePGCchainofcommand.

1. TheBWHMDirectorhastheauthoritytoapprove, modifyorterminatetheleaseprocess.

2. Mr. Capouillezassertsthatsuchleasesrepresentedlessthan1% ofallOGMleases.

c. LeasescouldalsobeenteredwithoutBWHMinputvianegotiationswiththeChiefCounselandExecutiveOffice.


1. Suchleasesdidnottypicallyoccur.

19. TheDivisionofEnvironmentalPlanningandHabitatProtection, BWHM, isprimarilyresponsiblefordeterminingtheSGLtractstobeleased, whenthetractsareofferedforlease, themethodbywhichtheleaseisawarded, andnegotiationofleasetermsincludingpayments, buttheCommissionershavefinalsoleauthoritytoenterintoOGMleases.

a. Mr. Capouillezinteractedwithoilandnaturalgasexplorationand/orproductioncompaniesandtheirrepresentativesthroughhisPGCemployment.

b. Mr. CapouillezhasbeeninvolvedintheleasingprocessofSGLtovaryingextentsthroughouthistenurewiththePGC.

c. AsDirectorofBWHM, Mr. CapouillezhadtheauthoritytoreviewleasingactionswithintheBureauastotheircompliancewithOGMstandardoperatingproceduresandOGMpolicyandmakerecommendationstothePGCchainofcommandregardingwhethertoapprove, modify, orterminatetheOGMleaseprocess, althoughMr. Capouillezwasnotthefinalauthority.

d. EvenifapprovedbyPGCstaff, allleaseprocessesweresubjecttoformalapprovalbyPGCChiefCounsel, PGCDeputyExecutiveDirector, PGCExecutiveDirector, PGCBoardofCommissioners, andreviewedbytheCommonwealth’sOfficeofAttorneyGeneral.

e. FinalapprovalofleasesmadebyPGCchainofcommandaboveCapouillezreliedprimarilyonrecommendationsmadebyCapouillezandhisstaff.

1. ThereisnorecordofanyofCapouillez’srecommendationsnotbeingapproved.

20. DuringCapouillez’semploymentwiththePGC, Capouillez’sformaljobresponsibilitiesinhisvariouspositionsheldhaveincludedinvolvement/participationinthepotentialleasingofSGLtooilandnaturalgasentitiestosomeextent.

a. InhispositionofDirectoroftheBWHM, Capouillez’sformalleasingresponsibilitiesincluded:

1. Directingthestatewidelandacquisitionandleasingprogram.

2. Preparing, recommending, andexplaininglandmanagementactivitiesandprogramstothePGCforconsideration.

3. Trainingsubordinatesinallaspectsofthelandmanagementprogram.

b. FromapproximatelyJanuary2003throughMay2015, Capouillezwasresponsiblefortheoversightoftheoil, gas, andmineralleasingprogramasitrelatedtoSGL.

BRMSFACKGROUND EGARDINGTHE ARCELLUS HALE ORMATION

21. MarcellusShaleisageologicformationthatcoversapproximatelysixtypercentofPennsylvaniaandisestimatedtocontainover500trillioncubicfeetofnaturalgas.


a. GeologistsandpetroleumengineershaveknownoftheMarcellusShaleformationanditsnaturalgaspotentialforanextendedperiodoftime. Althoughcostprohibitiveatonetime, improvementsintechnologysuchashorizontaldrilling, hydraulicfracturing, andthree-dimensionalimaginghavemadenaturalgasproductionfromtheMarcellusandothershaleformationseconomicallyfeasible.

22. Inordertoconductdrillingactivity, companiesmustacquirethesubsurfaceoiland/ornaturalgasrightsfromtheownerofsuchrights.

23. Leasingofpropertyfromlandownersbyoiland/ornaturalgascompaniesroutinelyfollowsthegeneralprocessasoutlinedbelow:

a. Companyidentificationofanareaofgeologicalinterest;

b. Solicitingandobtaininglandownerinterest;

c. Negotiatinganddevelopingalease;

d. Executingthelease;

e. Runningtitleontheland; and

1. Runningtitleonthelandconsistsofresearchingthepropertytoconfirmtheidentityofthepropertyowner(s) andtoensuretheoiland/ornaturalgasrightsarestillavailableforlease.

f. Issuingpaymenttothepropertyowner.

24. Companiesinterestedinoiland/ornaturalgasexplorationroutinelyutilizetheservicesofgeologiststoidentifyprospectiveareasinwhichdrillingisexpectedtobeproductive.

a. Onceanareaisidentified, companiesmayattempttoconsolidateleaseacreageviasolicitationofpropertyownerswithinthedesiredarearegardinginterestinleasingtheproperty’ssubsurfaceoiland/ornaturalgasrights.

25. Negotiationofoiland/ornaturalgasleasesprimarilyoccursbetweenarepresentativeorrepresentativesofthepotentialleasingcompanyandthepropertyowneroranindividual/companyretainedbythepropertyownertorepresenthim/her.

a. Multipletermsincludedwithinanoiland/ornaturalgasleasemaybenegotiatedincluding, butnotlimitedto, thefollowing:

1. Bonuspayments, shut-inpayments, delaypayments, androyaltypaymentpercentage;

2. Althoughroyaltypaymentpercentagesarenegotiable, aminimumroyaltypercentageof1/8or12.5% ismandatedbyPennsylvanialaw.

3. Theprimaryleaseterm (whichidentifiesthelengthoftimethattheleasingcompanymayholdaleasebeforecommencingdrillingoperationsontheleasedproperty);

4. Meansofingressandegress;


5. Reclamationandenvironmentalrequirements; and

6. Otherworkandoperationalcommitments.

26. Propertyownerswithlargetractsoflandand/orgroupsofpropertyownersoftenhavemoreleverageandnegotiatingpowerthandoindividualpropertyownerswithsmalleracreage. Similarly, largetractsofSGLaffordthePGCmoreleverageandnegotiatingpowerthansmallertractsofland.

EC’ PCBSTABLISHMENTOF APOUILLEZS RIVATE ONSULTING USINESSGA& LEOLOGICAL SSESSMENT EASING

27. WhileemployedasaHydrogeologist1forthePGC, Mr. Capouillezsoughtapprovaltoperformgeologicconsultingservicesforprivatelandownersasaformofsupplementaryemployment, whichapprovalwasgrantedonJuly23, 1996.

28. OnoraboutJuly23, 1996, Mr. CapouillezcreatedGeologicalAssessment & Leasing. Mr. CapouillezisthesoleproprietorandsoleinterestholderofGeological2Assessment & Leasing/GeologicalAssessment & Leasing, LLC (bothentitiesarehereinafterreferencedas “GAL”).

29. GALisanentitythatprovidesconsultingservicestolandownersregardinggeologicalassessmentoftheirpropertyandnegotiationanddevelopmentofoiland/ornaturalgasleases.

30. IndividualsemployedwithGALhaveincludedCapouillez, membersofCapouillez’simmediatefamilyandotherindividuals, someofwhomservedascontractors/sub- contracted/professionalemployees.

31. Mr. Capouillez’sbusinessmodelforGALwasuniqueincomparisontootherindividuals/entitiesthatprovidedsimilarservices.

a. Mr. CapouillezmarketedhisconsultingservicesthroughGALasperformance-based.

b. Mr. Capouillezsolicitedoil/naturalgascompaniesregardinginterestinpotentialacreageavailableforleasethroughacompetitivebidprocess.

c. Mr. Capouillezworkedunderaprivatelandownercontract, asapart-ownerofleasestobeperformed, inleasescompetitivelybid.

d. Mr. Capouillezcontractually, andasapracticalmatter, actedunderthedirectionandthefinalauthorityofthelandownerswhomheadvised.

e. ThesecontractscontainedaclausethatindicatedMr. CapouillezwouldrefuseanycompensationhewasdueasaresultofanyprivateleasesthatwereaffectedinanywaybyactivityonneighboringSGL. Inthesecircumstances, theportionoffundspotentiallyduetoMr. Capouillezwouldrevertbacktotheprivatelandowner.

32. Mr. Capouillezutilizednormalprintandinternetadvertisingtomarkethisservices, aswellasword-of-mouth.

2GALisregisteredasaDomesticLimitedLiabilityCompanywiththePennsylvaniaDepartmentofStateCorporationBureau. GAL’scertificateoforganizationwasfiledwiththePennsylvaniaDepartmentofStateonMarch21, 2008. GAL’sapplicationforRegistrationofFictitiousNamewasfiledonJuly9, 1997.


a. Mr. Capouillezattimesprovidedmarketingmaterialatseminarsand/orconferencesintheformofaself-createddocumentoutlininghisqualificationsandexperience, hispotentialfeesandbusinessmodel, andhisleasingstrategy/services. ThematerialexplainedMr. Capouillez’spotentialfeeandbusinessmodelasfollows:

1. GAL’sservicecontractwasstrictlyperformance-based.

2. GALreceivedcompensationonlyifMr. Capouillez/GALwasabletoachievemoreinleaserentsand/orroyaltythanthepropertyowner(s) hadalreadybeenoffered.

b. ThematerialexplainedMr. Capouillez’sleasingstrategy/servicesasfollows:

1. Negotiationandsolicitationofallpotentialoil/gasdevelopersinthearea.

2. Recommendingdraftingoffarmoreprotectiveleaseprovisionsforthepropertyowner.

3. Biddingoutoftheparcel(s) availableinanattempttoobtainabetterleaseandvalueratefortheproperty.

4. ContinuedoversightmanagementbyGALofthepropertyowner’sleaseforthedurationofthelease.

33. ThelandowneroftendirectedthatMr. Capouillez’s/GAL’scompensationwastobeissueddirectlyfromtheoilandnaturalgascompanies. ThisarrangementwasmemorializedinthetermsandconditionsinthecontractbetweenthelandownerandMr. Capouillez/GAL.

34. Oncehavingsecuredgroupsofpropertyownersasclientsandbidsfrominterestedoil/naturalgascompanies, Mr. Capouillezorganizedmeetingswiththegroupstodiscussbidsreceivedandtoawardaleasetothesuccessfulbidder.

35. Uponselectionofanoil/gascompany’sbid, Capouillezorganizedadateordatesonwhichthepropertyownerscouldmeetwiththeoil/gascompanyrepresentative(s) tosigntheirindividualleases.

a. Capouillezand/oranotherrepresentativeforGALwereoftenpresentattheleasesignings.

36. Mr. Capouillezroutinelysignedtheleasesoraddendumsthatwereattachedtotheleasesasaninterestedpartyintheleases. Asaninterestedparty, CapouillezretainedtherighttoapproveanyproposedrevisionstotheleasewhichaffectedCapouillez’sdelayrentaland/orroyaltypayments, aswellastheobligationsofLessor/LesseetoCapouillezascontainedwithinthelease.

37. ThePGC’sPolicyManualdirectsthatemployeesarenotpermittedtoholdanelectiveorappointedoffice, ortoengageinsecondaryemploymentwithoutspecificapprovaloftheExecutiveDirector.

38. In additiontothePGCPolicyManual, thePGCadherestoCommonwealthManagementDirective515.18, SupplementaryEmployment, Section5, whichrequiresthatallemployeeswhoworkforcompensationorremunerationinanycapacity, includingself-employment, outsideoftheirCommonwealthemploymentarerequiredtofilesupplementaryemploymentrequestswiththeiragencyheador


designatedofficialwhowilleitherapproveordisapprovetherequests. EmployeesarealsorequiredtoresubmitrequestswhenchangingsupplementaryemploymentorwheneverthedutiesofeithertheirCommonwealthorsupplementaryemploymentpositionchangesubstantially.

a. ThePGCisanindependentagencyandnotdirectlyundertheGovernor’sjurisdiction.

39. CapouillezcompletedandsubmittedaSupplementaryEmploymentRequestforapprovalonoraboutJuly23, 1996, tothePGCinrelationtohispotentialself- employmentthroughGAL.

40. CapouillezprovidedinformationpertainingtohisPGCjobduties, aswellasinformationrelatedtodutiesassociatedwithhispotentialself-employment, onhisJuly23, 1996, SupplementalEmploymentRequest.

a. CapouillezoutlinedhisjobdutiesasaHydrogeologist1as:

to\] actasadvisortohydrologicimpactsfrommining/constructionandoverseeoil/gas & mineraldevelopmentofPAGameLandsthroughleasingprogram.”

b. Capouillezidentifiedthefollowingasbeingincludedinhisdepartmentaljobduties:

1. Participationinthenegotiationofordecisiontoawardcontracts, orotherwisetakeorrecommendofficialactionofadiscretionarynaturewithregardtocontractingorprocurement;

2. Participationinthesettlementofclaimsorchargesinacontract;

3. Participationinthefixingofrates;

4. Participationintheissuanceofpermits, certificates, guaranteesorotherthingsofvalue; and

5. Thetakingorrecommending \[of\] officialactionofadiscretionarynaturewithregardtoinspecting, licensing, regulating, orauditinganybusiness, individual, corporation, union, association, firm, partnership, committee, cluborotherorganizationorgroupofpersons.

c. CapouillezdocumentedontheSupplementalEmploymentRequestthatallofthedutieswerederivedfromhisdirectinvolvementinleasingofPGCownedoil/gas & minerals, andonoccasionrecommendingactionsonpreviouslyawardedleasecompliance.

d. Capouillezdocumentedthetypeofbusinessasself-employmentconsultingasalicensedgeologistinrelationtohispotentialsupplementaryemployment.

1. Capouillezdocumentedthe dateheexpectedtobeginthesupplementaryemployment, “\[As\] soonaspossible.”

aa. TheinformationsuppliedbyCapouillezindicatedthatCapouillezhadnotyetperformedanyservicesthroughGALasofJuly23, 1996.


e. Capouillezidentifiedhisdutiesasageologyconsultanttoincludeactingasaconsultant/advisortoprivatepropertyownersastopotentialliabilityfromexisting/probablehydrologicimpactsfromconstructionanddevelopmentandadvisingpotentialrealestateownersastopotentialoil/gasandmineraldevelopmentoflands.

41. CapouillezacknowledgedontheJuly23, 1996, SupplementaryEmploymentRequestthathisself-employmentwouldinvolvehiminabusinessoranactivitywhichcouldpossiblyberelatedtohisdepartmentalduties, orwhichcouldpossiblycreateanactualorapparentconflictwithhisdepartmentalduties.

a. Capouillez’sSupplementaryEmploymentRequestrequiredthatawrittenexplanationofthispotentialconflictbeprovided.

1. Capouillez’sexplanationdeclared, “IfIwastoutilizemypositionwithintheCommonwealthandknowledgefromsuchsaidpositiontodirectlyinfluenceotherstobuy, sell, ortradeproperties. Knowingsuchpotential, ImustbeabletodiscernandconsistentlycheckonanypotentialconflictofinterestwiththeCommissionpriortoinitiatingemployment.”

42. Capouillez’sJuly23, 1996, SupplementaryEmploymentRequestwasreviewedandapprovedbyPGCChiefCounselPoussandHarryBenion, thenChiefofthePGCPersonnelServicesDivision. Therequestwasapprovedsubjecttothefollowingconditions:

a. ThesupplementalemploymentwouldnotinterferewithregularworkhoursorjobperformanceorviolatetheprovisionsoftheGovernor’sCodeofConductortheEthicsAct.

b. Mr. CapouillezcouldnotutilizeCommonwealthequipment, supplies, property, information, ideas, ordataderivedfromhisCommonwealthemploymentinthecourseofhissupplementalemployment.

c. Mr. CapouillezcouldnotparticipatethroughthesupplementalemploymentinanymatterthatpresentedaconflictwithhisresponsibilitiesasanemployeeofthePGC.

d. Mr. CapouillezcouldnotparticipatethroughthesupplementalemploymentinanytransactioninwhichtheCommonwealthhadadirectandsubstantialinterest.

e. Mr. CapouillezcouldnotusehispositionasanemployeeofthePGCoranyconfidentialinformationgainedthroughhispositionasHydrogeologistintheBureauofLandManagementinthecourseofhissupplementalemployment.

43. OnoraboutMay14, 2001, Mr. CapouillezsubmittedaSupplementaryEmploymentRequestseekingaPGClegalopinionandpotentialapprovalregardingaspecificpotentialGALclient: theWashingtonCountyPlanningCommission.

a. Intherequest, Mr. Capouillezidentifiedpossibleand/orapparentconflictswithhisdepartmentaldutiesatthePGC.

b. Mr. Capouillezexplainedthathehadbeenconsultingandrepresentingprivatelandownerswhosepropertieswereadjacenttothisparticulararea. ThePlanningCommissionrequestedthatherepresenttheirinterests, since


hehadindirectlyinfluencedthesolicitationofoil/gasinterestintheparkarea. Mr. Capouilleznotedthattheinformationhewouldutilizeand/ordevelopthroughtherepresentationofthePlanningCommissionwaseitherpublicorinformationhegatheredbyrepresentingprivateinterestsnearthepark.

c. OnJune13, 2001, afterhearingtheresultsofthePGClegalopinion, Mr. Capouillezwithdrewthissupplementalemploymentrequestbecauseitwasapparentthatapotentialforaconflictofinterestexisted. UponrequestofChiefCounselPouss, Mr. CapouillezsentthefollowingemailtoChiefCounselPoussandHarryBenion:

Harry:

Pleasebeadvised, IhaverecentlyreceivedtwoseparatecontractsfromWashingtonCounty, PlanningCommission, regardingoil/gaspotentialonSGL117. UpuntilthispointIhaveneverhadanofficialcontactfromtheWashingtonCountyOffice, becauseIcanseeapotentialconflictwithfutureoil/gasdevelopmentonSGL117andnowtheAlleghenyPowerExchangeParcel. Iwishtowithdrawmysupplementalemploymentapproval (onlywithregardtothePlanningCommission). Ihaveofferedtoassistthembothonanofficialbasisandifneededwithoutcompensationonmyowntimeastheyprepareandoil/gasbidpacket. Ifyouhaveanyquestions, pleasefeelfreetocontactmedirectly.

Thankyou.

d. Mr. CapouillezthuselectedtoavoidpotentialconflictsofinterestwithregardtoWashingtonCountyPlanningCommission.

44. Inthemidtolate1990sandearly2000s, privateindustryinterestinnaturalgasexplorationandrecoveryeffortsbegantoincreasesignificantlywithintheCommonwealth.

a. Farmersandotherpropertyownerswereroutinelysolicitedbyrepresentativesofand/orcontractorsonbehalfofthecompaniesregardingoilandgasleasing.

b. Limitedoutsideresourcesexistedatthattimetoassistpropertyownersinrelationtodecidingtoleaseornot, negotiationwithprivateindustry, leasetermsandrestrictions, etc.

45. Inorabout1999-2000thePennsylvaniaFarmBureau (hereinafter “PFB”) wasworkingwithseveralCountyFarmBureausandfarmerswithintheCommonwealthregardingleasingpropertyfornaturalgasexplorationandrecovery. In2001, PFBrequestedthePGC’sassistanceinprovidingaguestspeakerforPFBmembersataPFBRegion5RallyDayPrograminrelationtooilandnaturalgasleasing. CapouillezwasassignedtoattendtheprogramasthePGC’sexpertspeakeronoilandnaturalgasleases.

46. Capouillezdisclosed/identifiedhisCommonwealthemployment, thespecificagencyhewasemployedwith, andhisspecificpositionwithintheagencyatthetopofthefirstpageoftheoutlineCapouillezpresentedattheprogramasshownbelow:

WilliamA. CapouillezSpeaker: , PAGameCommissionChief, SectionofOil/Gas & MineralDevelopment

BureauofLandManagement (717) 783-4919EXT. 3626

a. Duringhisportionoftheprogram, Capouillezpresentedinformationregardinglandownerdeeds, miningleases, oil/gasleases, andexistingregulationsandprotectionstandards.


b. Capouillezdidnotspecificallyidentifyormarkethisprivateconsultingbusinessduringhispresentation.

c. ChrisSweger, whowastheWashingtonCountyFarmBureauPresidentatthetime, waspresentatthepresentationandapproachedCapouillezduringthelunchportionoftheeventtoaskifCapouillezknewofanyonewhocouldhelpagroupoflandownersfromWashingtonCountyinnegotiatingaleasewithprivateindustry.

d. CapouillezinformedSwegerthathedidprivateconsultingrelatingtooilandnaturalgasleasing.

47. Subsequenttothatprogram, Mr. CapouillezsolicitedbidsfrommultipleoilandnaturalgascompaniesonbehalfofclientsoftheWashingtonCounty, HopewellTownshipgroup. ThebidfortheWashingtonCounty, HopewellTownshipgroupwasultimatelyawardedtoGreatLakesEnergyPartners, LLC (nowRangeResources).

48. PublicityofthesuccessoftheHopewellTownshipgroupspreadaftertheleasesweresigned. ThesuccessofthisgroupfollowedbyCapouillez’sworkwithanumberofotherfarmers, veterans, andsimilarsocialgroupsinthenextfewyearsspurredadditionalbusinessforMr. Capouillez/GAL.

49. OnDecember15, 2010, BarbaraAdams, GeneralCounselfortheOfficeoftheGovernor, directedcorrespondencetoCarlG. Roe, thenExecutiveDirectorofthePennsylvaniaGameCommission, concerninganactualand/orperceivedconflictofinterestregardingCapouillezandhisactivitiesregardingGAL. TheDecember15, 2010, correspondencefurtherdirectedthatCapouillezsubmitanewsupplementalemploymentapplicationonayearlybasis, andthatthePGCconductafullexaminationintothismatter, specificallyaddressingCapouillez’sactionspursuanttotheEthicsAct, theGovernor’sCodeofConduct, andtheStateAdverseInterestAct.

50. InresponsetotheDecember15, 2010, correspondencefromtheOfficeofGeneralCounsel, BradleyC. Bechtel, AssistantCounseltothePennsylvaniaGameCommission, drafted amultipage, interofficememorandum toCarlRoe, thenExecutiveDirectorofthePGC, outlininghis (Bechtel’s) opinionthatnoconflictofinterestexistedastoMr. Capouillez’sactions, includinghisthen-currentemploymentwiththePGCandhissupplementalemploymentwithGAL.

a. AlthoughBechtel’smemorandum wasnotaddressedtohim, Capouillezindicatesthathewasotherwiseawareofits (thememorandum’s) existence, andcontinuedoperatingGALinrelianceonBechtel’sopinion.

51. OnJanuary11, 2011, AttorneyBechtelforwardedanunsignedcorrespondencetoBarbaraAdams, ChiefCounsel, inresponsetoherinitialcorrespondencedatedJanuary15, 2010, whereinMr. Bechtelindicatedthat “thePennsylvaniaGameCommission (PGC) hasconductedareviewofthesupplementalemploymentofWilliamA. CapouillezinconnectionwithhisworkwithGeologicalAssessmentLeasing (GAL).” Mr. Bechtelcontinuestoindicatethat “\[o\]urreviewdoesnotfindMr. Capouillez\] privytoconfidentialinformationthatwouldgivehimanadvantage

orwhichhecouldusetomakeaprofitintheprivatesector. … Essentially, shortofsometypeofspecificfacts, wecannotfindanyconflictofinterestwithMr. Capouillez’ SupplementalEmployment.” Thecorrespondenceconcludeswith “aswithyouroffice, wecanonlytakeactionbasedontheinformationbeforeus. Ifyou


believewehavefailedtotakeintoaccountsomeinformationtowhichyouareprivy, wewouldliketoreviewthatinformationbeforewetakeanyfurtheraction.”

52. AlthoughMr. Bechtel’sJanuary11, 2011, correspondenceindicatesthathereviewedMr. Capouillez’semploymentundertheEthicsAct, atnotimepriorto, orafterJanuary11, 2011, didMr. CapouillezmakecontactwiththePennsylvaniaStateEthicsCommissiontospecificallyseekanyAdviceofCounseland/orOpinionoftheCommissionasisprovidedforpursuanttothePennsylvaniaPublicOfficialandEmployeeEthicsAct.

53. Insummary, Mr. Capouillez’s/GAL’srepresentationoflandownergroupsinleasenegotiationswithoilandnaturalgasentitiesremainedconsistentfrom2001through2013andgenerallyincludedsolicitationofinterestfromoilandnaturalgascompaniesregardingacreageavailableforleasinginspecificareas. Followingtheacceptanceofabid, thelandownersauthorizedMr. Capouilleztoprovidecompanyrepresentativeswithinformationregardingpropertylocations, ownershipinformation, surrenderdocuments, etc. Mr. Capouillezwouldnotifythelandownersoftheschedulingofleasesigningsbetweenthelandownersgroupsandtheleasingoilandnaturalgasentities

THEFOLLOWINGFINDINGSRELATETOCAPOUILLEZ’SINTERACTIONWITHVARIOUSOIL/GASCOMPANIESINAPRIVATECAPACITYTHROUGHGALWHILEATTHESAMETIMESERVINGASTHEDIRECTOROFTHEBWHM.

C’ IEXCORAPOUILLEZS NTERACTIONWITH ESOURCES

54. EXCOResources, Inc. (hereinafter “EXCO”) isanaturalgasandoilcompany. EXCOResources (PA), LLC, (hereinafter “EXCOPA”) isa50/50jointventurebetweenEXCOandBGGroup, aliquefied naturalgascompany.

55. EXCO/EXCOPAhasenteredintosix (6) contracts/agreementsfortheleasingofoilandnaturalgasrightsfromunderSGLfromatleast1994throughthepresent.

56. Mr. CapouillezwasincontactwithvariousEXCOand/orEXCOPArepresentativesregardingSGLleasingduringhisemploymentwiththePGC. Forexample:

a. WhileemployedastheDirectoroftheBWHM, Mr. CapouillezattendedvariousmeetingswithEXCOPArepresentativesandotherPGCemployeesinrelationtotheleasingofSGL.

b. WhileemployedastheDirectoroftheBWHM, Mr. CapouillezwascourtesycopiedbyEXCOPArepresentativesonvariousemailstoPGCrepresentativesregardingleasingofSGL.

c. WhileemployedastheDirectoroftheBWHM, Mr. CapouillezwascourtesycopiedonvariouscorrespondencesfromthePGCtoEXCOPAinrelationtotheleasingofSGL.

57. Capouillez, inhisprivatecapacitywithGAL, solicitedinterestfromEXCOPAonmultipleoccasionsduringtherelevanttimeperiodoftheinvestigationofthismatter, inrelationtoGALclientsandthepotentialleaseacreageavailablethroughhisclientsasdocumentedviaemailmessagesreferencedbelow:

Date To From Subject1/19/10 JHeiser Capouillez ClintonCtyGrps


2/16/10 FRotunda TiogaCtyAcreageCapouillez2/16/10 FRotunda TiogaCtyAcreageCapouillez4/08/10 JHeiser BradfordCtyGrpCapouillez4/08/10 FRotunda BradfordCtyOil/GasLeaseBidCapouillez4/12/10 FRotunda BradfordCtyOil/GasLeaseBidCapouillez5/17/10 JHeiser Potter & McKeanCtyGrpsCapouillez5/17/10 FRotunda Potter & McKeanCtyAcreageCapouillez12/28/10 FRotunda LycomingCtyCapouillez12/29/10 FRotunda LycomingCtyCapouillez4/13/11 FRotunda LycomingCtyCapouillez4/14/11 FRotunda LycomingCtyCapouillez4/20/11 FRotunda LycomingCtyCapouillez6/16/11 FRotunda LycomingCtyPotentialLeaseTractsCapouillezDate To From Subject6/22/11 FRotunda UpdatedSchedule, LycomingLeasesCapouillez8/15/11 FRotunda LycomingCtyLeasesCapouillez8/17/11 FRotunda LeaseCapouillez8/22/11 FRotunda LycomingLeaseOfferCapouillez8/23/11 EBuddenbohn LycomingCtyRevisedOil/GasLeaseCapouillez8/28/11 EBuddenbohn LycomingCtyRevisedOil/GasLeaseCapouillez8/29/11 EBuddenbohn AdditionalLycomingLeaseTractCapouillez8/30/11 EBuddenbohn LycomingCtyRevisedOil/GasLeaseCapouillez9/09/11 EBuddenbohn Lease & AddendumInfoCapouillez9/11/11 EBuddenbohn EXCOLeaseSigningUpdatesCapouillez9/21/11 EBuddenbohn EXCOLeasemistakesCapouillez9/21/11 EBuddenbohn CapouillezOGLFinalCapouillez9/22/11 EBuddenbohn ChrisMetzgerCapouillez10/10/11 EBuddenbohn LeasingUpdatesCapouillez10/16/11 EBuddenbohn HenneLeasingOpportunityCapouillez10/20/11 EBuddenbohn DaleHenneLeaseLycomingCtyCapouillez12/30/11 EBuddenbohn LycomingPotentialLeaseCapouillez2/27/12 EBuddenbohn NextStepsinLeasingProcessCapouillez3/10/12 EBuddenbohn Capouillez NextStepsinLeasingProcess8/31/12 EBuddenbohn Capouillez AdditionalLycomingLeaseTract1/14/14 EBuddenbohn Capouillez GregoryBrownLeaseAmend & Ratif.

58. EXCOPArepresentativeswhoreceivedemailcommunicationsfromMr. CapouillezinrelationtoservicesprovidedthroughGALand/orpropertyownersrepresentedbyGALincluded:

a. RobertCrissinger, SeniorGMofOperationsb. FrankRotunda, DirectorofBusinessDevelopmentc. AdamVincent, SeniorLandmand. JudithErickson, SeniorLandmane. JoelHeiser, Vice-PresidentofLegalf. EricBuddenbohn, Landman


59. Capouillez, inhisprivatecapacitythroughGAL, activelysolicitedandcommunicatedwithEXCOPArepresentativesinrelationtoEXCOPA’spotentialinterestinacquiringprivatelandownerleasesatatimewhenEXCOPAwasnegotiatingforand/orengagedinactiveleasingofSGLwiththePGC.

60. Specifically, Mr. CapouillezcontactedFrankRotunda (“Rotunda”), theEXCOPADirectorofDevelopment, viaemailonoraroundDecember28, 2010, inquiringaboutEXCOPA’sinterestinapproximately10,000acresofGALclientpropertylocatedinLycomingCounty. Mr. CapouillezinformedRotundathathe/GALwasintheprocessofsolicitingbidsatthattimeandplannedtoscheduleameetingofthelandownergroupinJanuary2011. RotundarespondedtoMr. Capouillezviaemailthatsamedayrequestingtoseetheavailableproperty. Mr. CapouillezrespondedtoRotundaonDecember29, 2010, andincludedanattachmentofaregisterofavailablepropertiesinLycomingCounty.

61. Approximatelyamonthlater, onoraboutJanuary24, 2011, EXCOrepresentativeTroyRobertsonspokewithMichaelDiMatteo, oftheBWHM, regardingEXCOPA’spotentialleaseinterestinSGL #114.

a. DiMatteoalsobegancommunicatingwithRotundaonoraboutFebruary4, 2011, inrelationtoEXCO’sinterestinacreagewithinSGL #114.

b. Mr. CapouillezwasMr. DiMatteo’simmediateSupervisoratthePGCatthattimeandwasultimatelyresponsibleforMr. DiMatteo’sactivitiesinrelationtoanyleasingofPGClands.

c. Mr. DiMatteoroutinelyinformedMr. Capouillezofanentity’sinterestinleasingSGLoncenegotiationshadbecomeestablishedtoasignificantextent.

62. EffortsbythePGCandEXCOPAtonegotiateasole-sourceleaseawardforSGLTract114B-11culminatedwithapprovaloftheproposedleasebythePGCBoardofCommissionersattheApril12, 2011, PGCpublicmeeting.

63. OnedayafterthePGC’spublicleaseapprovalforSGL114B-11, Mr. CapouillezemailedRotundatofollow-uponEXCOPA’spotentialinterestintheGALclientacreageidentifiedinDecember2010.

a. Mr. Capouillezadvisedthathewasfinishingupthecompetitivebidprocess, andrequestedaresponseassoonaspossibleifEXCOPAhadaninterestinenteringacompetitivebid.

b. Mr. CapouillezprovidedRotundawithanupdatedclientregister.

c. RotundarespondedtoMr. CapouillezviaemailonApril14, 2011, statingthatthepotentialleaseacreagepreviouslyforwardedbyMr. Capouillezhadbeenlost. RotundaaskedifMr. Capouillezcouldresubmittheacreagethatwasstillavailable, andifitwaslimitedtotheacreagedocumentedinMr. Capouillez’sApril13, 2011, emailattachment.

d. Mr. Capouillezrespondedviaemailthatsameday (April14, 2011) andresubmittedtheavailableacreageaswellasacopyoftheLycomingCountybidprospectussuppliedtointerestedentities. TheprospectusidentifiedthatbidsweretohavebeenreceivedbyMarch9, 2011, 5:00p.m. EasternTime.


e. Mr. CapouillezinformedRotundathathewasmeetingwiththegroupduringthenextweek (April21, 2011). Mr. CapouillezinstructedRotundatoinformhim “ASAP” ifEXCOPAwasinterestedinanyorallofthetracts.

f. Mr. CapouillezrepeatedhisinquiryinaprivateemailtoRotundadatedApril20, 2011. Mr. Capouillezdirectlyquestioned, inpart, asfollows:

Frank . . . isExcointerested. Iammeetingtomorrownightwiththegroupandwillbepresentedalloffersandrequests. Doyouneedmoretime?

g. RotundarepliedtoMr. CapouillezviaprivateemaildatedApril21, 2011, andindicatedthatEXCOPAneededmoretime. RotundaindicatedthatEXCOPA “obviously” wasinterestedintheareaasEXCOPA’sdrillingfocusatthattimewasLycomingCounty.

h. InmultipleprivateemailtransmissionsbetweenRotundaandMr. Capouillez, spanningfromMay6, 2011, throughJune23, 2011, RotundaexpressedinterestinpursuitofthemajorityoftheavailableacreagepresentedbyMr. CapouillezwhichwaslocatedintheGambleandLewisTownshipareaofLycomingCounty.

i. InaprivateemailtoRotundadatedJune16, 2011, Mr. CapouillezidentifiedameetingtobeheldwithhisclientsonJune18, 2011, andquestionedRotundaaboutwhichspecifictractsEXCOPAwasinterestedinleasing. RotundaspecificallyidentifiedleasesthatEXCOPAwasinterestedinobtaininginanemailandattachmentdatedJune17, 2011, senttoT. Capouillez’semailaddress. Intheemail, RotundadocumentedEXCOPA’sofferof18% royaltyand $3,500.00pernetacreregardingroyaltyandbonusconsiderationrespectivelyforafiveyearpaiduptermlease.

j. PrivateemailcommunicationbetweenMr. CapouillezandEXCOPArepresentativesregardingleasereview, potentialadditionalacreageavailable, andleasefinalizationcontinuedintoAugust2011.

k. OnAugust17, 2011, Mr. CapouillezsentaprivateemailtoRotundathatidentifiedtheneedtogettherevisedleasedown “asap” sothatMr. CapouillezcouldreconvenewiththelandownergroupmembersinvolvedandpresentEXCOPA’sofferforconsideration.

l. Mr. CapouillezsenttheprivateemailtoRotundathedayafterreceivingaprivate emailfromKarenBrowninformingMr. CapouillezthatRiceEnergyhadofferedanareapropertyowner $5,000.00peracre. BrownsuppliedtheinformationtoMr. CapouillezspeculatingthatMr. Capouillezmaywanttoknowand/orcontactRiceEnergy.

m. EricBuddenbohnbecameinvolvedintheleasenegotiationsbetweenEXCOandMr. Capouillez/GALonoraboutAugust19, 2011. BuddenbohnprovidedMr. Capouillezwithaleaseformforreviewviaprivateemailonthisdate.

n. Mr. CapouillezrespondedtoBuddenbohnonAugust23, 2011, andpresentedhisbeliefthatthepartieswerecloseinregardtotheactualleaseform. Mr. Capouillezexpressedsurpriseregardingadjustmentsmadetotheroyaltyandbonusconsiderationofferedtoprivatelandowners.


1. AdjustmentsproposedbyBuddenbohnincludedareductioninroyaltypercentagesfrom18% to17% andareductioninbonusconsiderationfrom $3,500.00pernetacreto $3,020.00pernetacre.

2. Mr. CapouillezbasedhissurpriseonwhatheidentifiedSenecaResources, RiceEnergy, andBigStarEnergyofferingintheareatoprivatelandowners (19% and $4,000.00; $5,000.00; and18% and4,000respectively).

o. Mr. Capouillezdocumentedintheprivateemail, inpart, thefollowing:

TherearemanyreasonswhyIwantExcotobethesuccessfulbidder . . . butattheratereductionyouareproposing, IseriouslydoubtIwillbeabletopersuademygrouptoexecutethelease.

p. TheroyaltypercentageandbonusconsiderationweresubsequentlychangedbacktotheoriginalamountsofferedbyRotunda.

64. Throughthecompetitivebidprocessandwiththeapprovalofhislandownerclients, Mr. Capouillez’scommunicationswithEXCOPArepresentativesinrelationtoleaseacreageavailableinLycomingCountyultimatelyresultedintheexecutionofeighteenleasesbetweenMr. Capouillez/GALclientsandEXCOPA.

a. Mr. Capouillez, asarepresentativeofGAL, signedalleighteenoftheleasesexecutedbetweentheprivatelandownersandEXCOPA.

b. SteveArea, EXCOVicePresidentofLand & BusinessDevelopment, alsosignedtheleasesonbehalfofEXCOPA.

c. Pertheexecutedleasetermsandconditions, Mr. Capouillez/GALwasduecompensationintheamountof $20.00peracreinbonusconsiderationand0.75% ofallroyaltiesforeachlease. TheportionsofwhichweredirectlyrelatedtoMr. Capouillez’sprivatelandownercontracts \[sic\].

65. Duringthistimeframe, asdescribedinpartabove, EXCOPAwasnegotiatingand/orengagedinleasingofSGLwiththePGCforthefollowing:

a. EXCOhashadexistingleaseinterestsineffectforSGLTracts100A-00, 100A-01, and100B-01duringthetimeperiodofNovember2, 2004, throughthepresent.

b. EXCOPAexecutedaleaseforSGLTract114B-11onJuly7, 2011, andwasnegotiatingwiththePGCregardingthisleaseasearlyasJanuary2011.

66. Mr. Capouillezparticipatedinand/orwasresponsiblefordirectionandoversightofthestatewidelandacquisitionandleasingprogramduringthetimeframesnotedabove.

67. WhileservingastheBWHMDirectorforthePGC, Mr. CapouillezrepresentedGALclientsinthecompetitivebidprocessbynegotiatingandexecutingleaseswithEXCO, atatimeconcurrentwithPGCleasenegotiationswithEXCOPAonSGLproperties, whichledtoafinancialgaintoMr. Capouillez/GALof $31,358.70.

C’ IEMEAPOUILLEZS NTERACTIONWITH NDLESS OUNTAIN NERGY


68. EndlessMountainEnergyPartners, LLC (hereinafter “EME”), isanaturalgasexplorationandproductioncompanyfocusedondevelopmentofMarcellusacreageintheprolificregionsoftheMarcellusfairway, primarilyClintonandTiogaCounties.

69. EMEhashadanexistingcontract/agreementfortheleasingofoilandnaturalgasrightsunderSGL268A-11, locatedinTiogaCounty, fromAugust2011throughthepresent.

a. EMEhadinitialinterestinSGL268asofFebruary2010.

70. Mr. CapouillezfirstinteractedwithrepresentativesofEMEsometimebeforeearly2010inhiscapacityastheBWHMDirector.

71. Inoraboutearly2010, EMErepresentativesbecameawareofMr. Capouillez’sself- employment, throughmeansotherthanMr. Capouillez, abouthisconsultingworkafterattemptingtosolicitleasesfromprivatelandownersinClintonCounty.

72. BetweenFebruary2010andJanuary2011, Mr. Capouillez, throughGAL, inquiredandcommunicatedwithEMErepresentativesregardingacquiringprivateleaseswithGALclientsinClintonCountyatthesametimethatEMEexpressedinterestinleasingSGLinTiogaCounty.

73. Mr. Capouillez’sinquiriesandnegotiationswithEMErepresentativesultimatelyresultedintheexecutionofapproximatelysixty-fiveleasesbetweenGALclientsandEME.

a. Mr. CapouillezsignedtheleasesexecutedbetweenGALclientsandEME.

b. TheleaseswerealsosignedbyBrianKaufman, ChiefOperatingOfficer, orCarolKaufman, EMERegionalLandManager, asrepresentativesofEME.

c. PerthetermsandconditionsoftheprivatelandownercontractswithGAL, Mr. Capouillez/GALwasduecompensationintheamountof $50.00peracreinbonusconsiderationand1.75% ofallroyaltiesforeachlease.

d. AlloftheleaseswerelocatedinClintonCounty, nonewereinTiogaCounty.

74. WhileservingasBWHMDirectorforthePGC, Mr. CapouillezrepresentedGALclientsinnegotiatingandexecutingleasesinClintonCounty, atatimewhenEMEhadexpressedinterestinand/orwasactivelyinvolvedinnegotiationswiththePGCfortheleasingofSGLinTiogaCounty.

a. TherespectivelandandleaseswerenotsufficientlycloseintimeorgeographicproximitytoenabletheInvestigativeDivisiontorecommendthatanyuseofauthorityofofficebyCapouillezwasinviolationofSection1103(a) oftheEthicsAct. SeeThuy, Order1588, pg. 37.

THEFOLLOWINGFINDINGSRELATETOCAPOUILLEZ’SINTERACTIONSWITHVARIOUSGASCOMPANIESASAREPRESENTATIVEOFPRIVATEINDIVIDUALS/ GAL, WHILEATTHESAMETIMEMAINTAININGRESPONSIBILITYFORTHESTATEWIDELANDACQUISITIONANDLEASINGPROGRAMINHISCAPACITYASTHEDIRECTOROFTHEBWHM.

75. TheStateEthicsCommissionhasheldthatit “mustobservethefiveyearstatuteoflimitationsatSection1108(m) oftheEthicsAct, 65Pa.C.S. § 1108(m)” andassuchtheCommission “maynotconsideranyallegedviolationsoftheEthicsActpriortothefiveyearstatuteoflimitations.\] SeeThuyOrder1588pg37.


76. Inapplyingthefive-yearstatuteoflimitationsofSection1108(m) oftheEthicsAct, 65Pa.C.S. § 1108(m), theCommissionhasheldthat “procedurally, theinvestigation \[is\] commenced . . . whentheInvestigativeDivisionmailed

Respondent\] aletterviacertifiedmail, informinghimofthenatureoftheallegedviolationsoftheEthicsActandthattheInvestigativeDivisionwouldbeundertakinganinvestigationastosuchallegations.” SeropianOrder1547pg. 42.

a. Accordingly, forthepurposesoftheConsentAgreement, thereviewintheinstantmatterislimitedtoactswhichoccurredfromJanuary10, 2009, forward. SeeThuyOrder1588; SeropianOrder1547.

C’ ITEU.S.A. APOUILLEZS NTERACTIONWITH ALISMAN NERGY

77. TalismanEnergyU.S.A., Inc. (hereinafter “Talisman”) isanoilandgasproductioncompany \[anda\] whollyownedsubsidiaryofTalismanEnergy, Inc., basedinCalgary, Alberta.

a. Talismannowholdsapproximately217,000Tier1netacresinPennsylvania.

78. Talismanhasenteredintocontracts/agreementsfortheleasingofoilandnaturalgasrightsunderSGLorhasbeenajointoperatorwithanentityleasingSGLforsuchfromatleast2007throughthepresentasshowninthechartbelow.


Execution SGL Original AwardMethod Capouillez LeaseActivew/ DescriptionDate Tract Execution Position Talisman

04/07/2004 123A-03 Columbia PublicBid BWHM No TalismanhadJOA^ w/ChesapeakeNatRes Director Appalachia, LLCasof 01/01/07;

however, leaseexpired04/14

11/15/2011 219A-13 Talisman SoleSource BWHM Yes N/ADirector

10/17/2013 140A-13 Talisman SoleSource BWHM Yes N/ADirector

ReferstoCapouillez’spositionwhenTalismanreceivedtheleasesorbecameapartytotheleaseJOA = JointOperatingAgreement

79. TalismanrepresentativesspecificallycontactedtheOGMDevelopmentSectionoftheEnvironmentalPlanningandHabitatDivisionoftheBWHMasearlyasAugust2009regardingSGL219, November2009regardingSGL66, andJune2010regardingSGL140.

a. CapouillezinteractedwithrepresentativesofTalismaninassociationwithhispositionwiththePGCastheBWHMDirectorresponsibleforoversightofthePGCstatewideleasingprogram.

1. CapouillezsupervisedPGCemployeesnegotiatingleases.

b. CapouillezwasoperatingGALatalltimesfromJanuary2010throughJune2014.

80. CapouillezhadknowledgeofTalisman’sinterestinleasingSGLand/orcommunicatedwithTalismanrepresentativesregardingsuchonatleastsix (6) occasionsbetweenJanuary2010andFebruary10, 2012.

a. WhileemployedastheDirectoroftheBWHM, CapouillezparticipatedinvariousmeetingswithTalismanrepresentativesinrelationtotheleasingofSGL, wasdirectlyaddressedorcopiedbyTalismanrepresentativesonemailtoPGCrepresentativesregardingleasingofSGL, andwascourtesycopiedonemailfromPGCrepresentativestoTalismaninrelationtotheleasingofSGL.

81. CapouillezservedasaconsultantthroughGALforleasesexecuteddirectlybetweenGALclientsandTalismanin2010.

a. ThemajorityoftheleasesexecutedbetweenTalismanandGALclientswereexecutedinJune2010.

82. BetweenAugust29, 2009, andOctober2010, multiplecommunicationsoccurredbetweenCapouillezandTalismanrepresentativesDavidWhedbeeandJonathanWoodsregardingleasesforwhichCapouillez/GALservedastheprivatelandownerconsultant.

83. Capouillezactivelycommunicatedin2009and2010withTalismanrepresentativesregardingTalisman’sinterestinacquiringprivateleaseswithGALclientsatatimewhenTalismanwasnegotiatingforand/orengagedinactiveleasingofSGLwiththePGCatthetimewhenCapouillezhadcompleteoversightofthestatewidelandacquisitionandleasingprogram.

a. TalismanhadexistingleaseinterestsineffectforSGLTract123A-03duringthetimeperiodofAugust2009untilatleastApril2014.


b. TalismanwaspursuingitsinterestinthepotentialleasingofSGL66, 140, and/or219viacommunicationwithmultiplePGCrepresentatives, includingCapouillezin2010.

1. HerrickprovidedTalisman’ssolesourcerequestforSGL219toCapouillezviaemailonJune4, 2010, approximatelyoneweekpriortotheexecutionofatleastseventyleasesbetweenTalismanandGALclients.

c. TalismanhashadexistingleaseinterestsineffectforSGLTract219A-13and140A-13fromthetimeperiodofNovember15, 2011, throughthepresentandOctober17, 2013, throughthepresentrespectively.

84. Capouillez’s2009and2010negotiationswithTalismanrepresentativesinrelationtoleaseacreageavailablefromclientsrepresentedbyCapouillez/GALultimatelyresultedintheexecutionofapproximatelyseventy-threeleasesdirectlybetweenCapouillez/GALclientsandTalisman.

a. Capouillez, asarepresentativeofGAL, signedallseventy-threeoftheleasesexecutedbetweentheprivatelandownersandTalisman.

b. TheleasessigneddirectlywithTalismanweresignedbyDarinZanovich, AttorneyinFact, onbehalfofTalisman.

c. Pertheexecutedleasetermsandconditions, Capouillez/GALwasduecompensationinanamountrangeof $50.00peracreinbonusconsiderationand1.75% ofallroyaltiesforeachlease.

85. Inadditiontotheseventy-threeleasesexecuteddirectlybetweenTalismanandclientsrepresentedbyGAL, anadditionaltwohundredtwenty-oneleasesinvolvingCapouillez/GALclientswereassignedtoTalismanfromRangeResourcesand/orEOGResources.

a. CapouillezplayednoroleintheassignmentoftheleasesfromRangeResourcestoTalismanorEOGResourcestoTalisman.

86. CapouillezactivelyrepresentedclientsthroughGAL, hisprivateconsultingbusiness, beforeTalismanrepresentativesfortheleasingofprivatelandsandhadalsooriginallyservedasaconsultantforGALclientswhichwereultimatelyassignedtoTalisman, whilesimultaneouslyservinginthepositionoftheBWHMDirectorforthePGCresultinginpaymenttoCapouillez/GALofanundeterminableamountduringthesametimeperiodTalismanwasengagedinanexistingbusinessrelationshipwiththePGCregardingtheleasingofSGLandwasactivelyinvolvedinnegotiationswithPGCrepresentativessupervisedbyCapouillezfortheleasingofadditionalSGL.

a. CapouillezwasresponsiblefordirectionandoversightofthePGCstatewidelandacquisitionandleasingprogramatalltimesduringthenegotiationsbetweenTalismanandthePGCforSGLTract219A-13and140A-13andduringthenegotiationsbetweenTalismanandprivatelandownersrepresentedbyCapouillez/GAL.

C’ IEQTCAPOUILLEZS NTERACTIONWITH ORPORATION

87. EQTCorporationisanintegratedenergycompanyinvolvedinnaturalgasproduction, gathering, andtransmission.


a. InoraboutDecember2009, EQTenteredintoajointventurewithEMEforthepurposeofsecuringoilandgasleasesinnortheasternPennsylvania, includingprivateaswellasSGLleases.

88. In2010, astheBWHMDirector, CapouillezhadinteractionsandcommunicationswithvariousEQTrepresentativesregardingpotentialSGLleasing.

a. Specifically, astheDirectoroftheBWHM, CapouillezattendedmeetingswithEQTrepresentativesinrelationtothepotentialleasingofSGLduringtheweekofApril26, 2010.

b. AstheDirectoroftheBWHM, CapouillezauthoredcorrespondencedatedMay26, 2010, toTimothyMatthews, SeniorVicePresidentofAmericanExplorationCompany, regardingtheassignmentofSGLLease014A-01toEQTandthePGC’sintenttoapprovetheassignmenttoEQTwaspre- conditionedonAmericanExplorationCompanyfullycomplyingwiththetermsandconditionssetforthinCapouillez’sandMatthews’smostrecenttelephoneconversation.

c. Capouillez, astheDirectoroftheBWHM, wasthespecificaddresseerelatingtocorrespondenceauthoredbyHodgesdatedJune4, 2010, regardingpotentialleaseamendmentsuponassignmentoftheleaseforSGL014A-01fromAmericanExplorationCompanytoEQT, whichreferenceddiscussionthathadoccurredthemorningofJune4, 2010, betweenCapouillezandHodges, includingthepotentialleaseamendments.

d. In2010, astheDirectoroftheBWHM, CapouillezwasalsocopiedonallcorrespondencefromthePGCtoEQTinrelationtotheleasingofSGL.

89. Capouillez’semploymentasDirectoroftheBWHMBureauforthePGC, andhisprivateconsultingbusinessGAL, wasthesubjectofemaileddiscussionsamongEQTrepresentativesinFebruary2011.

a. Theemailconversationwasinitiatedasaresultofa2008newspaperarticlewhichoutlinedCapouillez’ssimultaneousserviceasDirectoroftheBWHMandhisoutsidebusinessinterestswithGAL.

b. EQTofficialshadconcernsofapotentialconflictofinterestforCapouillezattheCommonwealth, ifCapouillezwouldgetcitedfor “moonlighting” andthatalthoughCapouillezhadbeenhelpfultoEQT, hemaynotbeabletodosointhefuture.

90. Capouillez’sinvolvementwiththeassignmentofSGLleaseswithAmericanExplorationCompany toEQToccurredduringthesametimethathewasrepresentingGALclientswhoseleaseswithEMEwereassignedtoEQT.

a. AlloftheleasesinitiallyexecutedbetweenprivatelandownersrepresentedbyCapouillez/GALandEMEwereassignedtoEQTinJune2010.

b. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, playanyroleintheassignmentofEMEleasestoEQT.

c. Capouillezreceivedpaymenttotaling $56,301.34fromEQTasaresultoftheassignmentofthoseleasesfromEME, atatimewhenhewasalsoservingasDirectoroftheBWHM.

RR( GLEP) ANGE ESOURCES PREVIOUSLYKNOWNAS REAT AKES NERGY ARTNERS


91. RangeResourcesCorporationwascreatedasaresultofthemergerofLomakPetroleumInc. andDomainEnergyin1998.

a. In2007, RangeResourcesCorporationopenedanofficeinPittsburgh, Pennsylvania, tofocusontheMarcellusShaledrilling.

92. Sinceatleast1994, Mr. CapouillezinteractedwithrepresentativesofRangeResources (“Range”) inrelationtoRange’sleasingofSGL, situatedinvariousmunicipalitiesofVenangoCounty.

a. Rangeenteredintoatleasteight (8) contractsfortheleasingofoilandgasrightsfromSGLbeginningin1994withthemostrecentleaseeffectiveonApril29, 2008.

93. Between2001and2008, Mr. Capouillez, inhisprivatecapacitythroughGAL, inquiredofandcommunicatedwithRangerepresentativesinrelationtoRange’spotentialinterestinsecuringprivatelandownerleasesatatimeortimeswhenRangewasengagedinexistingleaseswiththePGCand/orhadexpressedaninterestinadditionalSGLleases.

94. Mr. Capouillez’sinquiries, negotiations, andcommunicationswithRangerepresentativesultimatelyresultedintheexecutionofanumberofleasesbetweenRangeandGALclients, noneofwhichleaseswerelocatedinVanango, Crawford, orFayetteCountywhereRangesubsequentlyenteredintoleaseswiththePGC, orwerefinalizedwithintheapplicablelimitationperiod.

95. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, executeanycontractsonbehalfofprivateclientswithRangeand/oritsaffiliatesaftercalendar \[year\] 2008.

a. AnyactionsofCapouillezresultinginaprivatepecuniarybenefitoccurredpriortoJanuary10, 2009, andperpriorconsistentrulingsoftheStateEthicsCommission, areoutsideoftheapplicableStatuteofLimitationsasdelineatedwithin65Pa.C.S. § 1108(m). SeeThuyOrder1588; SeropianOrder1547.

b. InlightofpriorrulingsoftheStateEthicsCommission, andforpurposesofthisConsentAgreement, thereceiptofcontractuallypre-fixedpayments, negotiatedoutsideoftheapplicablestatuteoflimitationsoftheEthicsAct, doesnotgiverisetoaviolationofsame.

EOGRESOURCES

96. EOGResources (hereafter “EOG”), anindependent (non-integrated) crudeoilandnaturalgascompany, hasmaintainedabusinesscontract/agreementfortheleasingofoilandnaturalgasrightsunderSGLfromatleast2008throughthepresent.

a. EOGwasformerlyknownasEnronOil & GasCompany.

97. CapouillezdevelopedabusinessrelationshipwithEOGbeginninginoraboutJuly2009throughGALasaresultoftheassignmentofforty-twoleasesfromRange (31) andTalisman (11) toEOGfrom2009into2013.

a. Oftheforty-oneleasesoriginallyexecutedwithRange, onewasexecutedin2002, twowereexecutedin2003, andthirty-eightwereexecutedinApril/June2008.


b. TenoftheleasesoriginallyexecutedwithRangewerelaterassignedtoTalisman.

98. Mr. CapouillezhadnospecificnegotiationwithEOGrepresentativesinrelationtotheassignmentoftheseleases, butMr. CapouillezwasincontactwithEOGrepresentativesin2007and2008atatimewhenEOGwasengagedinactiveleasingofSGLwiththePGC.

99. Mr. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, playanyroleintheassignmenttoEOGofpreviouslyexecutedcontractsbetweenclientsofGALandRange/Talisman. BecauseRangelostanumberoforiginalleases, itsrecordsregardingtheseassignmentsandrelatedleaseslackdetailsoftimeandspecificleaseidentification.

100. Mr. Capouillez’ssimultaneouscontactwithEOGand/oritsrepresentatives/affiliatesasarepresentativeofGALandasDirectoroftheBWHMdidnotresultinadditionalpecuniarybenefitbeyondthatcontainedwithintheoriginal/assignedcontractsnegotiatedbetween2003and2008.

a. AnyactionsofCapouillezresultinginaprivatepecuniarybenefitoccurredpriortoJanuary10, 2009, andperpriorconsistentrulingsoftheStateEthicsCommission, areoutsideoftheapplicableStatuteofLimitationsasdelineatedwithin65Pa.C.S. § 1108(m). SeeThuyOrder1588; SeropianOrder1547.

CE, I. ONSOL NERGY NC

101. ConsolEnergy, Inc./CNXGas (hereinafter “Consol”) isapubliclyownedproducerofnaturalgasandcoalthathasenteredintonolessthanthree (3) contracts/agreementsfortheleasingofoilandnaturalgasrightsfromunderSGLfromatleast2010throughthepresent.

102. InAprilandMay2010, Mr. CapouillezinquiredofConsolregardingConsol’sinterestinleasingpropertyfromGALclients. However, Consoldidnotexecuteanyleasesasaresultofthisinquiry.

103. Mr. CapouillezalsohadexposuretoConsolthroughGALasaresultofapartialassignmentofoneleasefromRangeResourcestoConsolinDecember2011, butwasnotspecificallyinvolvedinthenegotiationsofthispartialassignment.

a. ConsoldidmakepaymentstoCapouilleztotaling $643.88duringtherelevanttimeperiodasaresultofaleaseassignmentfromRangetoConsol.

104. AtthetimeCapouillezsoughtinterestfromConsolregardingthepotentialleasingofpropertyfromGALclients, hewasinvolvedasDirectorofBWHMwithactionsrelatingtotheassignmentoftheleaseforSGL195BfromDominionTransmissiontoConsol.

a. TheassignmentoftheleaseforSGL195BfromDominionTransmissiontoConsolwasgrantedbythePGCeffectiveMay18, 2010.

1. CapouillezsignedthePGCConsenttoAssignmentofOilandGasLeaseonbehalfofthePGCinhispositionofBWHMDirector.

105. InlightofpriorrulingsoftheStateEthicsCommission, forthepurposesofthisConsentAgreement, $643.88isdeminimis, aswellastheresultofacontractually


pre-fixedpayment, negotiatedoutsideoftheapplicablestatuteoflimitationsoftheEthicsAct, anddoesnototherwisegiverisetoaviolationofsame.

XTOENERGY

106. XTOEnergy, Inc. (hereinafter “XTO”) isanaturalgasandoilentitythathasenteredintonolessthanthree (3) contracts/agreementsfortheleasingofoil, naturalgas, andmineralrightsunderSGLfromMay2008throughthepresent.

107. Mr. Capouillezwasawareofand/orgainedknowledgeofXTO’sinterestinSGLleasingaroundMay2008asaresultoftheassignmentofexistingSGLleasesfromLinnEnergytoXTO.

108. InAugust2010, whiletheXTOleasesforSGLwerestillinplace, oneoftheleasespreviouslyexecutedbetweenaGALclientandRangeResourceswasassignedtoXTO.

a. CapouillezdidnotplayanyroleintheassignmentofGALleasesfromRangetoXTO.

109. Mr. Capouillez’ssimultaneouscontactwithXTOand/oritsrepresentatives/affiliatesasarepresentativeofGALandasDirectoroftheBWHMdidnotresultinadditionalpecuniarybenefitbeyondthatcontainedwithintheoriginal/assignedcontracts.

a. AnyactionsofCapouillezresultinginaprivatepecuniarybenefitoccurredpriortoJanuary10, 2009, andperpriorconsistentrulingsoftheStateEthicsCommission, forthepurposesofthisConsentAgreement, areoutsideoftheapplicableStatuteofLimitationsasdelineatedwithin65Pa.C.S. § 1108(m). SeeThuyOrder1588; SeropianOrder1547.

APNADARKO ETROLEUM

110. AnadarkoPetroleumCorporation (hereinafter “Anadarko”) isthelargestindependentoilandgasexplorationandproductioncompanywithintheUnitesStates.

111. Anadarkohasenteredintonolessthannine (9) contracts/agreementsfortheleasingofoilandnaturalgasrightsfromSGLorhasheldajointinterestwithanentity/entitiesleasingSGLsinceapproximately2008.

112. Mr. Capouillez’sinteractionwithrepresentativesfromAnadarkowhilerepresentingGALclientsresultedintheexecutionofatleasttenleasesbetweencalendaryears2006and2008.

113. During2006-2008AnadarkowasinvolvedinnegotiatingasolesourceleasewiththePGCforSGL114A-10.

114. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, executeanycontractsonbehalfofprivateclientswithAnadarkoand/oritsaffiliatesaftercalendar \[year\] 2008.



CEHESAPEAKE NERGY

115. ChesapeakeEnergyCorporation (hereinafter “Chesapeake”) isacompanyengagedintheexploration, development, andacquisitionofpropertiesfortheproductionofnaturalgasandoil.

116. Chesapeakehasenteredintonolessthaneleven (11) contracts/agreementsfortheleasingofoilandnaturalgasrightsfromunderSGL, andhasheldjointinterest(s) withanentity/entitiesleasingSGLfromMay2008throughthepresent.

117. Mr. CapouillezhadknowledgeofChesapeake’spotentialinterestinleasingSGLasearlyasAugust2007, asaresultofanemailreceivedfromChesapeake’slandmanonoraboutAugust13, 2007.

118. BetweenMay2007andJuly2010, Mr. Capouillez, inhisprivatecapacitythroughGAL, inquiredofChesapeakerepresentativesinrelationtoChesapeake’spotentialinterestinacquiringGALclientleasescontemporaneoustotimeswhenChesapeakewasnegotiatingforand/oractivelyinvolvedinleasingofSGLwiththePGC.

119. Mr. Capouillez’sinquiriesandnegotiationswithChesapeakerepresentativesultimatelyresultedintheexecutionofthirtyleasesbetweenGALclientsandChesapeake, between2007and2008.


PGEC, LLCENNSYLVANIA ENERAL NERGY OMPANY

120. PennsylvaniaGeneralEnergyCompany, LLC (hereinafter “PGE”) isaprivatelyowned, independentoilandnaturalgasexplorationandproductioncompanythathasenteredintonolessthantwo (2) contracts/agreementsfortheleasingofoilandnaturalgasrightsunderSGLorhasbecomeapartytosuchaleasethroughassignmentfromanotherentityfromMay2002toMarch2007, andfromFebruary5, 2013, throughthepresent.

121. Mr. CapouillezwasawareofPGE’sinterestinleasingthroughanoperatingagreementwithanotherentitysinceapproximatelyApril5, 2002.

122. InOctober2009, tenGALclientleaseswereassignedfromRangeandAnadarkotoPGE.

a. CapouillezservedasaconsultantthroughGALfornineleasesinitiallyexecutedbetweenGALclientsandRangein2006-2007, whichwereultimatelyassignedtoPGEonOctober13, 2009.

b. Capouillez/GALservedasaconsultantforoneleaseinitiallyexecutedbetweenprivatelandownersandAnadarkoin2007, whichwasultimatelyassignedtoPGEonJuly9, 2013.

123. BetweenNovember2002andMay2011, Mr. CapouillezinquiredofPGEinrelationtoPGE’spotentialinterestinobtainingGALclientacreageduringthetimeframethatPGEhadanactiveleaserelationshipwiththePGCforSGL049A-01. TheseinquiriesdidnotleadtoanycontractsbetweenPGEandGALclients.


124. Mr. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, playanyroleintheassignmenttoPGEofpreviouslyexecutedcontractsbetweenclientsofGALandRange/Anadarko.

125. Mr. Capouillez’ssimultaneouscontactwithPGEand/oritsrepresentatives/affiliatesasarepresentativeofGALandasDirectoroftheBWHMdidnotresultinprivateleasesforGALclientsnorinadditionalpecuniarybenefittothemorMr. Capouillezbeyondthat containedwithintheoriginal/assignedcontracts.


THEFOLLOWINGFINDINGSRELATETOACTIONSTAKENBYTHEPGCTOREVOKEWILLIAMCAPOUILLEZ’SSUPPLEMENTALEMPLOYMENTAUTHORIZATION.

126. CapouillezoperatedGALatalltimesfromJuly23, 1996, throughMarch17, 2014, withtheapprovalofthePGCasprovidedinCapouillez’sJuly23, 1996, SupplementaryEmploymentRequest.

a. Commonwealthemployeeswishingtoengageinsupplementalemploymentmustreceiveapprovalpriortoengaginginsuch.

127. Capouillez’sJuly23, 1996, supplementaryemploymentrequestneverdisclosedtothePGCthathewouldbesimultaneouslyrepresentingprivatelandownersinoilandgasleasenegotiationswiththesamecompaniesthatwerenegotiatingoilandgasleaseswiththePGC.

a. CapouillezidentifiedhisdutiesasaGeologyConsultant, whichwouldincludeactingasaconsultant/advisortopropertyownersastopotentialliabilityfromexisting/probablehydrologicimpactsfromconstructionanddevelopmentandadvisingpotentialrealestateownersastopotentialoil/gasandmineraldevelopmentoflands.

128. AlthoughCapouillezhadsoughtsupplementalemploymentauthorization, hiscontinuedroleastheDirectoroftheBWHMandhisrepresentationofGALclientswasthesubjectofspeculationamongstsomemembersoftheOGMcommunity, andwasdiscussedprivatelyinemailtransmissionbetweenJakeStranskyrepresentativeofUltraResources) andMarcDunn (representativeofEdgewood

Energy, Inc.)

1. InanemailtoDunndatedApril12, 2010, regardinganSGLupdate, Stranskyauthoredthefollowing:

Thankyoufortheupdate. IamcurioustoseeifthefolksatStateGameshaveanyhelpfulinformation. ThewordisUltrahasaskedthemseveraltimestoprovideuswithinformationonwhattheyownandhaveneverbeenabletodoso.”

2. DunnrespondedtoStranskyviaemailonApril12, 2010, statingthat:

IhearyouontheGameLandsissue. OneoftheproblemswiththeGameLandsstuffisthatakeyplayerintheadmin., BillCapouillez, theagency’sdirectorofWildlifeHabitatManagement, alsodealsonthesidewithOGMandfrequentlyputslandownergroupstogether


andthensellsthepkg. ofac. tooperators. SoIthinktheagencyisalittle ‘slow’ incomingupwithanyinfo.”

129. InoraboutMarch2014, recommendationsweremadebyGovernorCorbettandlegislativeleaderstothePGCregardingMr. Capouillez’semployment, includingrevocationofanysupplementalemployment \[authorization\].

130. CapouillezwasinformedviacorrespondencedatedApril1, 2014, fromR. MatthewHough, ExecutiveDirectoratthattime, thathisapprovalforsupplementaryemploymentwith/throughGALhadbeenrescindedeffectiveMarch18, 2014.

a. HoughdocumentedthattheMarch18, 2014, rescindingofCapouillez’ssupplementaryemploymentwithGALwasinaccordancewith “ourdiscussionofthatdate.”

131. CapouillezisknowntohavecontinuedtoparticipateinactionsassociatedwithGALandtheprivateclientherepresented, particularlyEXCO, throughatleastJune17, 2014.

132. Capouillez’sactionsincontactingBuddenbohn/EXCOPAinrelationtoclientsrepresentedbyCapouillez/GALwereindirectviolationofManagementDirective515.18.

a. Capouillez’ssupplementaryemploymentwith/throughGALhadbeenrevokedeffectiveMarch18, 2014.

1. CapouillezwasissueddocumentationdatedApril1, 2014, confirmingsuchrevocationanditseffectivedateasMarch18, 2014.

b. ManagementDirective515.18isspecificallydocumentedasbeingapplicabletonotonlysupplementaryemploymentbutvolunteeractivitiesaswell.

c. Capouillezrealizednofinancialgaininthisactivity, asitwasanaccommodationtoaGALclientwithapre-existinglease.

C’ D2014IIDSAPOUILLEZS ECEMBER NTERVIEWWITH NVESTIGATIVE IVISION TAFF

133. OnDecember12, 2014, Mr. CapouillezparticipatedinaninterviewwithrepresentativesoftheInvestigativeDivision.

134. TheinterviewwasconductedattheofficeofandinthepresenceofAttorneyRobertDavis, Jr., Mr. Capouillez’sattorney.

135. DuringtheinterviewMr. Capouillezasserted, inpart, thefollowing:

a. Mr. CapouillezworkedintheprivatesectorpriortohisCommonwealthemployment. Mr. CapouillezperformedconsultingservicesforpropertyownersrelatedtooilandnaturalgaspriortohisemploymentwiththeCommonwealth, althoughnotunderanactualfictitiousnameuntilthemid- 1990s. Mr. Capouillezobtainedhisclientsprimarilythroughwordofmouth, hisexposuretootherconsultantswhileemployedwithMineTech, hismilitarycontacts, andhisFreeMasoncontacts.

b. Mr. CapouillezwasinitiallysolicitedbyPGCrepresentativestoworkforthePGCinanewlycreatedHydrogeologistposition.


c. Mr. Capouillezbecameinvolvedintheleasingaspectofoil, gas, andmineralrightsunderSGLshortlyafterbeinghiredbythePGC.

d. Mr. CapouillezdevelopedtheconceptofpubliclybiddingtheSGLOGMleasesthroughacompetitivebidprocess. Noformalleasingprogramexistedpriortohisinvolvement.

e. Priorto2002, whileemployedastheSectionChiefofOGMDevelopment, Mr. CapouillezwasresponsibleforthefacilitationofbidsfortheleasingofSGL, processingofsaidbids, obtainingrequiredapprovalsthroughthechainofcommand, andcoordinationeffortsbetweentheHarrisburgofficeandregionaloffices.

f. Between2002and2006, whileemployedastheDivisionChiefoftheEPHPD, Mr. CapouillezwascognizantofleasingSGLforOGMdevelopment; however, hewasnotinvolvedtothesamedegreeaswhenhewastheSectionChiefofOGMDevelopment.

g. From2006to2014, Mr. CapouillezhadnoresponsibilityinhispositionasDirectoroftheBWHMregardingtheleasingofSGLforoilandnaturalgas; rather, hisinvolvementwaslimitedtothatofamanagementperspective.

h. Mr. CapouillezsubmittedhisGALsupplementaryemploymentrequestinordertoobtainsupervisoryexperiencetoqualifyforpotentialpromotiontoDivisionChief.

i. Mr. Capouillez’s/GAL’sclient basefrommid-1996untilearly2001wasdwindling/limited. In2001Mr. Capouillez’sclientbasethroughGALgrewandsignificantlyincreasedoverthenextseveralyears.

j. Mr. Capouillezhadnotrepresentedanylargelandownergroups (morethantwotothreepeople) priortoworkingwiththeHopewellTownshipgroup.

k. Mr. CapouillezmadenospecificreferencetohispositionwiththePGCduringanypresentationsbeforeprivatelandownersuntilthelandownerswerereadytosignthelandownercontractwithMr. Capouillez/GAL. Priortoenteringintothecontractwiththelandowners, Mr. CapouillezdisclosedhisemploymentwiththeCommonwealth, avoidingidentificationofhisspecificposition, andinformedthelandownersthathecouldnottakeormakeprivatebusinesscallsduringtheday, thathecouldnottraveltomeetingsinaCommonwealthvehicle, etc.

l. Mr. Capouillez’slandownercontractidentifiedconstraintshehadtofollow, andcontainedaclausethatindicatedthathewouldrefuseanycompensationhewasdueasaresultofprivateleasesthatwereaffectedinanywaybyactivityonneighboringSGL. TheportionoffundspotentiallyduetoMr. Capouillezwouldrevertbacktotheprivatelandowner.

m. Mr. Capouillezhadnospecificknowledgeorrecollectionofsolicitinganyprivateentity/entitiesatthesametimethattheentity/entitieswerealsoattemptingtoleaseSGL.

n. Mr. Capouillezunderstoodtheconcernsraisedandcouldseetheappearanceofaproblemwithhisdualpositions.

III. DISCUSSION:


AstheDirectoroftheBureauofWildlifeHabitatManagement (“BWHM”) forthePennsylvaniaGameCommission (“PGC”) fromapproximatelyDecember2, 2006, throughMay18, 2015, RespondentWilliamCapouillez, alsoreferredtohereinas “Respondent,” RespondentCapouillez,” and “Capouillez,” wasapublicofficial/publicemployeesubjectto

theprovisionsofthePublicOfficialandEmployeeEthicsAct (“EthicsAct”), 65Pa.C.S. § 1101etseq.

TheallegationsarethatCapouillezviolatedSection1103(a) oftheEthicsActwhenheutilizedtheauthorityofhispublicemployment, and/orconfidentialinformationreceivedthroughhisholdingpublicemployment, fortheprivatepecuniarybenefitofhimselfand/orabusinesswithwhichheisassociated, namelyGeologicalAssessmentandLeasingLLC, whenheorganized, negotiatedand/orarrangedleaseagreementswithprivateindustryrepresentativesforoil, gasandmineral (“OGM”) explorationonPGCgamelands, whilesimultaneouslyperformingthesameactionsforprivatelandownerswithintheCommonwealthforafee.

PursuanttoSection1103(a) oftheEthicsAct, apublicofficial/publicemployeeisprohibitedfromengaginginconductthatconstitutesaconflictofinterest:

1103. Restrictedactivities

a) Conflictofinterest.— Nopublicofficialorpublicemployeeshallengageinconductthatconstitutesaconflictofinterest.

65Pa.C.S. § 1103(a).

ThefollowingtermsaredefinedintheEthicsActasfollows:

1102. Definitions

Conflict" or "conflictofinterest." Usebyapublicofficialorpublicemployeeoftheauthorityofhisofficeoremploymentoranyconfidentialinformationreceivedthroughhisholdingpublicofficeoremploymentfortheprivatepecuniarybenefitofhimself, amemberofhisimmediatefamilyorabusinesswithwhichheoramemberofhisimmediatefamilyisassociated. Thetermdoesnotincludeanactionhavingademinimiseconomicimpactorwhichaffectstothesamedegreeaclassconsistingofthegeneralpublicorasubclassconsistingofanindustry, occupationorothergroupwhichincludesthepublicofficialorpublicemployee, amemberofhisimmediatefamilyorabusinesswithwhichheoramemberofhisimmediatefamilyisassociated.

Authorityofofficeoremployment." Theactualpowerprovidedbylaw, theexerciseofwhichisnecessarytotheperformanceofdutiesandresponsibilitiesuniquetoaparticularpublicofficeorpositionofpublicemployment.

Business." Anycorporation, partnership, soleproprietorship, firm, enterprise, franchise, association, organization, self-employedindividual, holdingcompany, jointstockcompany, receivership, trustoranylegalentityorganizedforprofit.

Businesswithwhichheisassociated." Any


business inwhichthepersonoramemberoftheperson'simmediatefamilyisadirector, officer, owner, employeeorhasafinancialinterest.

Financialinterest." Anyfinancialinterestinalegalentityengagedinbusinessforprofitwhichcomprisesmorethan5% oftheequityofthebusinessormorethan5% oftheassetsoftheeconomicinterestinindebtedness.

65Pa.C.S. § 1102.

Section1103(a) oftheEthicsActprohibitsapublicofficial/publicemployeefromusingtheauthorityofpublicoffice/employmentorconfidentialinformationreceivedbyholdingsuchapublicpositionfortheprivatepecuniarybenefitofthepublicofficial/publicemployeehimself, anymemberofhisimmediatefamily, orabusinesswithwhichheoramemberofhisimmediatefamilyisassociated.

Asnotedabove, thepartieshavesubmittedaConsentAgreementandStipulationofFindings. Theparties' StipulatedFindingsaresetforthaboveastheFindingsofthisCommission. Weshallnowsummarizetherelevantfactsascontainedtherein.

ThePGCisanindependentagencygovernedbyaneightMemberBoardofCommissioners.

From1993throughMay18, 2015, CapouillezwasemployedbythePGCinvariouspositionsthatinvolvedleasingofStateGameLands (“SGL”) tooilandnaturalgasentities. FromapproximatelyJanuary2003throughMay2015, CapouillezwasresponsiblefortheoversightofthePGCoil, gas, andmineralleasingprogramasitrelatedtoSGL. Capouillezinteractedwithoilandnaturalgasexplorationand/orproductioncompaniesandtheirrepresentativesthroughhisPGCemployment.

AsPGC’sEnvironmentalPlanningManagerfromMay25, 2002, toDecember1, 2006, Capouillez’sdutiesandresponsibilitiesinrelationtooil, gas, andmineralrecoveryincluded, interalia, administeringthePGC’soil, gas, andmineralresourcemanagementprogram, maintainingliaisonwithmajorenergycompanystaffs, negotiatingdetailsofoil, gas, andmineralleasingprogramswithprivatecompanyrepresentatives, andpreparingleasesandagreements.

FromapproximatelyDecember2, 2006, throughMay18, 2015, CapouillezwasDirectoroftheBWHM. TheBWHMdirectlymanagesapproximately1.4millionacresofSGLandassistswithapproximately3millionmoreacresofprivatelandenrolledinPGC’sPublicAccessProgram. TheBWHMperformscomprehensiveplanningforthedevelopmentoflandsforwildlifehabitats, timberharvests, andremovalofoil, gas, and/orminerals.

Duetothefive-yearstatuteoflimitationssetforthatSection1108(m) oftheEthicsAct, 65Pa.C.S. § 1108(m), ourreviewinthismatterislimitedtothetimeperiodfrom

3January10, 2009, forward. CapouillezservedasDirectoroftheBWHMduringthetimeperiodunderreview.

3 See, StipulatedFinding76a. Section1108(m) oftheEthicsActprovides:

1108. Investigationsbycommission

m) Limitationoftime.—Thecommissionmayconductaninvestigationwithinfiveyearsaftertheallegedoccurrenceofanyviolationof \[theEthicsAct\].

65Pa.C.S. § 1108(m).


AsDirectoroftheBWHM, Capouillez’sdutiesincludeddirectingthestatewidelandacquisitionandleasingprogram, whichincludedtheoil, gas, andmineralrecoveryprogram. TheBWHM’sDivisionofEnvironmentalPlanningandHabitatProtectionisprimarilyresponsiblefordeterminingtheSGLtractstobeleased, whenthetractsareofferedforlease, themethodbywhichtheleaseisawarded, andnegotiationofleasetermsincludingpayments. Capouillez’spositionasBWHMDirectorincludedresponsibilitiesandauthorityintheleasingprocesses.

TheleasingofOGMrightsonPGCSGLmaybeaccomplishedviaa “publicbid” orsolesource” process. Inthepublicbidprocess, theBWHMDirectorisresponsiblefor

determiningifOGMstandardoperatingproceduresandOGMpolicyhavebeenmetorifcorrectionstothebidpackagearerequired. Ifcorrectionsarerequired, thepackageissenttotheOGMSectionforchanges. Inthesolesourceprocess, theBWHMDirectorisresponsiblefordeterminingifOGMstandardoperatingproceduresandOGMpolicyhavebeenmet, ifthepotentialleaseshouldbeconsideredforfurtherprocessing, orifthetermsoftheleaseshouldbemodifiedthroughthePGCchainofcommand.

AsBWHMDirector, CapouillezhadtheauthoritytomakerecommendationstothePGCchainofcommandregardingwhethertoapprove, modify, orterminatetheOGMleaseprocess. FinalapprovalofleaseswasmadebyPGCchainofcommandaboveCapouillezandreliedprimarilyonrecommendationsmadebyCapouillezandhisstaff. ThereisnorecordofanyofCapouillez’srecommendationsnotbeingapproved.

Negotiationofoiland/ornaturalgasleasesprimarilyoccursbetweenrepresentative(s) ofthepotentialleasingcompanyandthepropertyowneroranindividual/companyretainedbythepropertyownertorepresenthim/her. Multipletermsincludedwithinanoiland/ornaturalgasleasemaybenegotiatedincluding, butnotlimitedto, bonuspayments, shut-inpayments, delaypayments, androyaltypaymentpercentage.

AsaPGCemployee, Capouillezwassubjecttorequirements tofileaSupplementaryEmploymentRequestwithPGCofficial(s) andtoobtainapprovalofsamepriortoworkingforcompensationorremunerationoutsideofCommonwealthemployment. Capouillezalsowasrequiredtoresubmitsucharequestwhenchangingsupplementaryemploymentorwheneverthedutiesofeitherhis Commonwealthorsupplementaryemploymentpositionwouldchangesubstantially.

CapouillezisthesoleproprietorandsoleinterestholderofbusinessentitiesnamedGeologicalAssessment & Leasing/GeologicalAssessment & Leasing, LLC (bothentitiesarealsoreferredtohereinas “GAL”). OnoraboutJuly23, 1996, Capouillezcompleted

ThisCommission’sRegulationsprovide, inpart:

11.3. Statuteoflimitations.

TheCommissionmayinvestigateaviolationoftheactwithin5yearsofitsoccurrence. Theoccurrencetranspireswhenanactiscompleteorrequiresnofurtheraction. . . .

51Pa. Code § 11.3.

Section1108(c) oftheEthicsActprovidesthat “\[n\]oinvestigationmaybecommenceduntilthepersonwhoisthesubjectoftheinvestigationhasbeennotifiedandprovidedageneralstatementoftheallegedviolationorviolationsofthischapterandotherapplicablestatuteswithrespecttosuchinvestigation. Serviceofnoticeiscompleteuponmailingwhichshallbebycertifiedorregisteredmail. . . .” 65Pa.C.S. § 1108(c).

TheRegulationsofthisCommissionprovidethataninvestigationisconsideredcommencedwhentherespondentisnotifiedofthematterasrequired (51Pa. Code § 21.3(c)) andthatserviceoftherequisitenoticetoarespondentiscompleteuponmailingofthenoticebycertifiedorregisteredmail (51Pa. Code § 21.5(b)).


andsubmittedtothePGCaSupplementaryEmploymentRequestforapprovalinrelationtohispotentialself-employmentthroughGAL. TheinformationsuppliedbyCapouillezindicatedthatCapouillezhadnotyetperformedanyservicesthroughGALasofJuly23, 1996. Capouillezdocumentedthetypeofbusinessasself-employmentconsultingasalicensedgeologist. Capouillezidentifiedhisdutiesasageologyconsultantasincludingactingasaconsultant/advisortoprivatepropertyownersastopotentialliabilityfromexisting/probablehydrologicimpactsfromconstructionanddevelopmentandadvisingpotentialrealestateownersastopotentialoil/gasandmineraldevelopmentoflands. CapouillezacknowledgedontheJuly23, 1996, SupplementaryEmploymentRequestthathisself-employmentwouldinvolvehiminabusinessoranactivitywhichcouldpossiblyberelatedtohisdepartmentalduties, orwhichcouldpossiblycreateanactualorapparentconflictwithhisdepartmentalduties. Capouillez’sJuly23, 1996, SupplementaryEmploymentRequestdidnotdisclose tothePGCthathewouldbesimultaneouslyrepresentingprivatelandownersinoilandgasleasenegotiationswiththesamecompaniesthatwerenegotiatingoilandgasleaseswiththePGC.

OnJuly23, 1996, Capouillez’sJuly23, 1996, SupplementaryEmploymentRequestwasapprovedsubjecttothefollowingconditions: (1) thesupplementalemploymentwouldnotinterferewithregularworkhoursorjobperformanceorviolatetheprovisionsoftheGovernor’sCodeofConductortheEthicsAct; (2) CapouillezcouldnotutilizeCommonwealthequipment, supplies, property, information, ideas, ordataderivedfromhisCommonwealthemploymentinthecourseofhissupplementalemployment; (3) CapouillezcouldnotparticipatethroughthesupplementalemploymentinanymatterthatpresentedaconflictwithhisresponsibilitiesasanemployeeofthePGC; (4) CapouillezcouldnotparticipatethroughthesupplementalemploymentinanytransactioninwhichtheCommonwealthhadadirectandsubstantialinterest; and (5) CapouillezcouldnotusehispositionasanemployeeofthePGCoranyconfidentialinformationgainedthroughhisPGCpositioninthecourseofhissupplementalemployment.

FromJuly23, 1996, throughMarch17, 2014, CapouillezoperatedGALwiththeapprovalofthePGC.

Duringthetimeperiod underreview, GALprovided consultingservicestolandownersregardingnegotiationanddevelopmentofoiland/ornaturalgasleases. Capouillezperformedsuchworkunderaprivatelandownercontract, asapart-ownerofleasestobeperformed. ThelandownercontractscontainedaclausethatCapouillezwouldrefuseanycompensationhewasdueasaresultofanyprivateleasesthatwereaffectedinanywaybyactivityonneighboringSGL. Insuchcircumstances, theportionoffundspotentiallyduetoCapouillezwouldreverttotheprivatelandowner.

Capouillezsecuredgroupsofpropertyownersasclientsandsolicitedbidsfrominterestedoil/naturalgascompanies. Capouillezorganizedmeetingswiththegroupstodiscussbidsreceivedandtoawardaleasetothesuccessfulbidder. Uponselectionofanoil/gascompany’sbid, Capouillezorganizedadateordatesonwhichthepropertyownerscouldmeetwiththeoil/gascompanyrepresentative(s) tosigntheirindividualleases. Capouillezand/oranotherrepresentativeofGALwereoftenpresentattheleasesignings. Capouillezroutinelysignedtheleasesoraddendumsthatwereattachedtotheleasesasaninterestedpartyintheleases. Asaninterestedparty, CapouillezretainedtherighttoapproveanyproposedleaserevisionswhichaffectedCapouillez’sdelayrentaland/orroyaltypayments, aswellastheobligationsoftheLessor/LesseetoCapouillez.

ThelandowneroftendirectedthatCapouillez’s/GAL’scompensationwastobeissueddirectlyfromtheoilandnaturalgascompanies. ThisarrangementwasmemorializedinthetermsandconditionsinthecontractbetweenthelandownerandCapouillez/GAL.

C’ IEXCORAPOUILLEZS NTERACTIONWITH ESOURCES


EXCOResources, Inc. (hereinafter “EXCO”) isanaturalgasandoilcompany. EXCOResources (PA), LLC, (hereinafter “EXCOPA”) isa50/50jointventurebetweenEXCOandBGGroup, aliquefiednaturalgascompany.

EXCO/EXCOPAhasenteredintosixcontracts/agreementsfortheleasingofoilandnaturalgasrightsfromunderSGLfromatleast1994throughthepresent.

WhileemployedastheDirectoroftheBWHM, Capouillez attendedvariousmeetingswithEXCOPArepresentativesandotherPGCemployeesinrelationtotheleasingofSGLandwascourtesycopiedonvariousemailsfromEXCOPArepresentativestoPGCrepresentativesandonvariouscorrespondencesfromthePGCtoEXCOPAinrelationtotheleasingofSGL.

Duringtherelevanttimeperiod, inhisprivatecapacitywithGAL, CapouillezsolicitedinterestfromEXCOPAonmultipleoccasionsinrelationtoGALclientsandthepotentialleaseacreageavailablethroughhisclients. See, FactFinding57.

EXCOPArepresentativeswhoreceivedemailcommunicationsfromCapouillezinrelationtoservicesprovidedthroughGALand/orpropertyownersrepresentedbyGALincluded: RobertCrissinger, SeniorGMofOperations; FrankRotunda (“Rotunda”), DirectorofBusinessDevelopment; AdamVincent, SeniorLandman; JudithErickson, SeniorLandman; JoelHeiser, Vice-PresidentofLegal; andEricBuddenbohn

Buddenbohn”), Landman.

Capouillez, inhisprivatecapacitythroughGAL, activelysolicitedandcommunicatedwithEXCOPArepresentativesinrelationtoEXCOPA’spotentialinterestinacquiringprivatelandownerleasesatatimewhenEXCOPAwasnegotiatingforand/orengagedinactiveleasingofSGLwiththePGC.

CapouillezcontactedRotundaviaemailonoraroundDecember28, 2010, inquiringaboutEXCOPA’sinterestinapproximately10,000acresofGALclientpropertylocatedinLycomingCounty. CapouillezinformedRotundathathe/GALwasintheprocessofsolicitingbidsatthattimeandplannedtoscheduleameetingofthelandownergroupinJanuary2011. RotundarespondedtoCapouillezviaemailthatsamedayrequestingtoseetheavailableproperty. CapouillezrespondedtoRotundaonDecember29, 2010, andincludedanattachmentofaregisterofavailablepropertiesinLycomingCounty.

OnoraboutJanuary24, 2011, EXCOrepresentativeTroyRobertsonspokewithMichaelDiMatteo (“DiMatteo”) oftheBWHMregardingEXCOPA’spotentialleaseinterestinSGL #114. DiMatteoalsobegancommunicatingwithRotundaonoraboutFebruary4, 2011, inrelationtoEXCO’sinterestinacreagewithinSGL #114. CapouillezwasDiMatteo’simmediateSupervisoratthePGCatthattimeandwasultimatelyresponsibleforDiMatteo’sactivitiesinrelationtoanyleasingofPGClands. DiMatteoroutinelyinformedCapouillezofanentity’sinterestinleasingSGLoncenegotiationshadbecomeestablishedtoasignificantextent.

EffortsbythePGCandEXCOPAtonegotiateasole-sourceleaseawardforSGLTract114B-11culminatedwithapprovaloftheproposedleasebythePGCBoardofCommissionersattheApril12, 2011, PGCpublicmeeting.

OnedayafterthePGC’spublicleaseapprovalforSGL114B-11, CapouillezemailedRotundatofollow-uponEXCOPA’spotentialinterestintheGALclientacreageidentifiedinDecember2010. Capouillezadvisedthathewasfinishingupthecompetitivebidprocess, andrequestedaresponseassoonaspossibleifEXCOPAhadaninterestinenteringacompetitivebid. CapouillezprovidedRotundawithanupdatedclientregister.


RotundarespondedtoCapouillezviaemailonApril14, 2011, statingthatthepotentialleaseacreagepreviouslyforwardedbyCapouillezhadbeenlost. RotundaaskedifCapouillezcouldresubmittheacreagethatwasstillavailable, andifitwaslimitedtotheacreagedocumentedinCapouillez’sApril13, 2011, emailattachment.

Capouillezrespondedviaemailthatsameday (April14, 2011) andresubmittedtheavailableacreageaswellasacopyoftheLycomingCountybidprospectussuppliedtointerestedentities. TheprospectusidentifiedthatbidsweretohavebeenreceivedbyMarch9, 2011, 5:00p.m. EasternTime.

CapouillezinformedRotundathathewasmeetingwiththegroupduringthenextweek (April21, 2011). CapouillezinstructedRotundatoinformhim “ASAP” ifEXCOPAwasinterestedinanyorallofthetracts.

CapouillezrepeatedhisinquiryinaprivateemailtoRotundadatedApril20, 2011. FactFinding63f. RotundarepliedtoCapouillezviaprivateemaildatedApril21, 2011, andindicatedthatEXCOPAneededmoretime. RotundaindicatedthatEXCOPAobviously” wasinterestedintheareaasEXCOPA’sdrillingfocusatthattimewas

LycomingCounty.

InmultipleprivateemailtransmissionsbetweenRotundaandCapouillezfromMay6, 2011, throughJune23, 2011, RotundaexpressedinterestinpursuitofthemajorityoftheavailableacreagepresentedbyCapouillezwhichwaslocatedintheGambleandLewisTownshipareaofLycomingCounty.

InaprivateemailtoRotundadatedJune16, 2011, CapouillezidentifiedameetingtobeheldwithhisclientsonJune18, 2011, andquestionedRotundaaboutwhichspecifictractsEXCOPAwasinterestedinleasing. RotundaspecificallyidentifiedleasesthatEXCOPAwasinterestedinobtaininginanemailandattachmentdatedJune17, 2011. Intheemail, RotundadocumentedEXCOPA’sofferof18% royaltyand $3,500.00pernetacreregardingroyaltyandbonusconsiderationrespectivelyforafiveyearpaiduptermlease.

PrivateemailcommunicationbetweenCapouillezandEXCOPArepresentativesregardingleasereview, potentialadditionalacreageavailable, andleasefinalizationcontinuedintoAugust2011. OnAugust17, 2011, CapouillezsentaprivateemailtoRotundathatidentifiedtheneedtogettherevisedleasedown “asap” sothatCapouillezcouldreconvenewiththelandownergroupmembersinvolvedandpresentEXCOPA’sofferforconsideration. CapouillezsenttheprivateemailtoRotundathedayafterCapouillezwasinformedthatRiceEnergyhadofferedanareapropertyowner $5,000.00peracre.

BuddenbohnbecameinvolvedintheleasenegotiationsbetweenEXCOandCapouillez/GALonoraboutAugust19, 2011. Onthatdate, BuddenbohnprovidedCapouillezwithaleaseformforreviewviaprivateemail. CapouillezrespondedtoBuddenbohnonAugust23, 2011, andpresentedhisbeliefthatthepartieswerecloseinregardtotheactualleaseform. Capouillezexpressedsurpriseregardingadjustmentsmadetotheroyaltyandbonusconsiderationofferedtoprivatelandowners. AdjustmentsproposedbyBuddenbohnincludedareductioninroyaltypercentagesfrom18% to17% andareductioninbonusconsiderationfrom $3,500.00pernetacreto $3,020.00pernetacre. CapouillezbasedhissurpriseonwhatheidentifiedSenecaResources, RiceEnergy, andBigStarEnergyofferingintheareatoprivatelandowners (19% and4,000.00; $5,000.00; and18% and $4,000respectively).

Capouillezstatedintheprivateemail, inpart, thefollowing:


TherearemanyreasonswhyIwantExcotobethesuccessfulbidder . . . butattheratereduction youareproposing, IseriouslydoubtIwillbeabletopersuademygrouptoexecutethelease.

FactFinding63o. TheroyaltypercentageandbonusconsiderationweresubsequentlychangedbacktotheoriginalamountsofferedbyRotunda.

Throughthecompetitivebidprocessandwiththeapprovalofhislandownerclients, Capouillez’scommunicationswithEXCOPArepresentativesinrelationtoleaseacreageavailableinLycomingCountyultimatelyresultedintheexecutionofeighteenleasesbetweenCapouillez/GALclientsandEXCOPA. Capouillez, asarepresentativeofGAL, signedalleighteenoftheleasesexecutedbetweentheprivatelandownersandEXCOPA. Pertheexecutedleasetermsandconditions, Capouillez/GALwasduecompensationintheamountof $20.00peracreinbonusconsiderationand0.75% ofallroyaltiesforeachlease.

Duringthistimeframe, asdescribedinpartabove, EXCOPAwasnegotiatingand/orengagedinleasingofSGLwiththePGC. EXCOhashadexistingleaseinterestsineffectforSGLTracts100A-00, 100A-01, and100B-01duringthetimeperiodofNovember2, 2004, throughthepresent. EXCOPAexecutedaleaseforSGLTract114B-11onJuly7, 2011, andwasnegotiatingwiththePGCregardingthisleaseasearlyasJanuary2011.

Capouillezparticipatedinand/orwasresponsiblefordirectionandoversightofthestatewidelandacquisitionandleasingprogramduringthetimeframesnotedabove.

ThepartieshavestipulatedthatwhileservingastheBWHMDirectorforthePGC, CapouillezrepresentedGALclientsinthecompetitivebidprocessbynegotiatingandexecutingleaseswithEXCO, atatimeconcurrentwithPGCleasenegotiationswithEXCOPAonSGLproperties, whichledtoafinancialgaintoCapouillez/GALof $31,358.70.

C’ IEMEAPOUILLEZS NTERACTIONWITH NDLESS OUNTAIN NERGY

EndlessMountainEnergyPartners, LLC (alsoreferredtohereinas “EME”), isanaturalgasexplorationandproductioncompanythatdevelopsMarcellusacreageinClintonandTiogaCounties. WhileservingasBWHMDirectorforthePGC, CapouillezrepresentedGALclientsinnegotiatingandexecutingleasesinClintonCountyatatimewhenEMEhadexpressedinterestinand/orwasactivelyinvolvedinnegotiationswiththePGCfortheleasingofSGLinTiogaCounty. PertheStipulatedFindings, therespectivelandandleaseswerenotsufficientlycloseintimeorgeographicproximitytoenabletheInvestigativeDivisiontorecommendthefindingofaviolationofSection1103(a) oftheEthicsActinthisregard. StipulatedFinding74a.

C’ ITEU.S.A. APOUILLEZS NTERACTIONWITH ALISMAN NERGY

TalismanEnergyU.S.A., Inc. (alsoreferredtohereinas “Talisman”) isanoilandgasproductioncompanyandawhollyownedsubsidiaryofTalismanEnergy, Inc., basedinCalgary, Alberta. Talismanhasenteredintocontracts/agreementsfortheleasingofoilandnaturalgasrightsunderSGLorhasbeenajointoperatorwithanentityleasingSGLforsuchfromatleast2007throughthepresent. See, StipulatedFinding78.

TalismanrepresentativesspecificallycontactedtheOGMDevelopmentSectionoftheEnvironmentalPlanningandHabitatDivisionoftheBWHMasearlyasAugust2009regardingSGL219, November2009regardingSGL66, andJune2010regardingSGL140. TalismanwaspursuingitsinterestinthepotentialleasingofSGL66, 140, and/or219viacommunicationwithmultiplePGCrepresentatives, includingCapouillezin2010.


InhispubliccapacityastheBWHMDirectorresponsibleforoversightofthePGCstatewideleasingprogram, CapouillezinteractedwithrepresentativesofTalismanandsupervisedPGCemployeesnegotiatingleases. CapouillezhadknowledgeofTalisman’sinterestinleasingSGLand/orcommunicatedwithTalismanrepresentativesregardingsuchonatleastsixoccasionsbetweenJanuary2010andFebruary10, 2012. WhileemployedastheDirectoroftheBWHM, CapouillezparticipatedinvariousmeetingswithTalismanrepresentativesinrelationtotheleasingofSGL, wasdirectlyaddressedorcopiedbyTalismanrepresentativesonemailtoPGCrepresentativesregardingleasingofSGL, andwascourtesycopiedonemailfromPGCrepresentativestoTalismaninrelationtotheleasingofSGL.

Capouillezactivelycommunicatedin2009and2010withTalismanrepresentativesregardingTalisman’sinterestinacquiringprivateleaseswithGALclientsatatimewhenTalismanwasnegotiatingforand/orengagedinactiveleasingofSGLwiththePGCandCapouillezhadcompleteoversightofthestatewidelandacquisitionandleasingprogram. CapouillezwasresponsiblefordirectionandoversightofthePGCstatewidelandacquisitionandleasingprogramatalltimesduringthenegotiationsbetweenTalismanandthePGCforSGLTract219A-13and140A-13andduringthenegotiationsbetweenTalismanandprivatelandownersrepresentedbyCapouillez/GAL.

Talisman’ssolesourcerequestforSGL219wasprovidedtoCapouillezviaemailonJune4, 2010, approximatelyoneweekpriortotheexecutionofatleastseventyleasesbetweenTalismanandGALclients.

Capouillez’s2009and2010negotiationswithTalismanrepresentativesinrelationtoleaseacreageavailablefromclientsrepresentedbyCapouillez/GALultimatelyresultedintheexecutionofapproximately73leasesdirectlybetweenCapouillez/GALclientsandTalisman. Capouillez, asarepresentativeofGAL, signedall73oftheleasesexecutedbetweentheprivatelandownersandTalisman. Pertheexecutedleasetermsandconditions, Capouillez/GALwasduecompensationinanamountrangeof $50.00peracreinbonusconsiderationand1.75% ofallroyaltiesforeachlease.

Inadditiontothe73 leasesexecuteddirectlybetweenTalismanandclientsrepresentedbyGAL, anadditional221 leasesinvolvingCapouillez/GALclientswereassignedtoTalismanfromRangeResourcesand/orEOGResources. CapouillezplayednoroleintheassignmentoftheleasesfromRangeResourcestoTalismanorEOGResourcestoTalisman.

TalismanhashadexistingleaseinterestsineffectforSGLTract219A-13and140A-13fromNovember15, 2011, throughthepresentandOctober17, 2013, throughthepresentrespectively.

ThepartieshavestipulatedthatCapouillezactivelyrepresentedclientsthroughGAL, hisprivateconsultingbusiness, beforeTalismanrepresentativesfortheleasingofprivatelandsandhadalsooriginallyservedasaconsultantforGALclientswhichwereultimatelyassignedtoTalisman, whilesimultaneouslyservinginthepositionoftheBWHMDirectorforthePGC, resultinginpaymenttoCapouillez/GALofanundeterminableamountduringthesametimeperiodTalismanwasengagedinanexistingbusinessrelationshipwiththePGCregardingtheleasingofSGLandwasactivelyinvolvedinnegotiationswithPGCrepresentativessupervisedbyCapouillezfortheleasingofadditionalSGL.

C’ IEQTCAPOUILLEZS NTERACTIONWITH ORPORATION

EQTCorporationisanintegratedenergycompanyinvolvedinnaturalgasproduction, gathering, andtransmission. InoraboutDecember2009, EQTenteredintoajointventurewithEMEforthepurposeofsecuringoilandgasleasesinnortheasternPennsylvania, includingprivateaswellasSGLleases.


In2010, astheBWHMDirector, CapouillezwascopiedonallcorrespondencefromthePGCtoEQTinrelationto theleasingofSGLandhadinteractionsandcommunicationswithvariousEQTrepresentativesregardingpotentialSGLleasing. Specifically, astheDirectoroftheBWHM, CapouillezattendedmeetingswithEQTrepresentativesinrelationtothepotentialleasingofSGLduringtheweekofApril26, 2010. CapouillezauthoredcorrespondencedatedMay26, 2010, toTimothyMatthews, SeniorVicePresidentofAmericanExplorationCompany, regardingPGC’sintenttoapprovetheassignmentofSGLLease014A-01toEQTsubjecttocertainconditions. Capouillez, asBWHMDirector, alsowasthespecificaddresseeoncorrespondencedatedJune4, 2010, regardingpotentialleaseamendmentsuponassignmentoftheleaseforSGL014A-01fromAmericanExplorationCompanytoEQT.

Capouillez’sinvolvementwiththeassignmentofSGLleaseswithAmericanExplorationCompanytoEQToccurredduringthesametimethathewasrepresentingGALclientswhoseleaseswithEMEwereassignedtoEQT. AlloftheleasesinitiallyexecutedbetweenprivatelandownersrepresentedbyCapouillez/GALandEMEwereassignedtoEQTinJune2010. Capouillezdidnot, eitherasanindividualand/orasarepresentativeofGAL, playanyroleintheassignmentofEMEleasestoEQT.

Capouillezreceivedpaymenttotaling $56,301.34fromEQTasaresultoftheassignmentofthoseleasesfromEME, atatimewhenhewasalsoservingasDirectoroftheBWHM.

CE, I. ONSOL NERGY NC

ConsolEnergy, Inc./CNXGas (hereinafter “Consol”) isapubliclyownedproducerofnaturalgasandcoalthathasenteredintonolessthanthreecontracts/agreementsfortheleasingofoilandnaturalgasrightsfromunderSGLfromatleast2010throughthepresent.

InAprilandMay2010, CapouillezinquiredofConsolregardingConsol’sinterestinleasingpropertyfromGALclients. However, Consoldidnotexecuteanyleasesasaresultofthisinquiry.

AtthetimeCapouillezsoughtinterestfromConsolregardingthepotentialleasingofpropertyfromGALclients, hewasinvolvedasDirectorofBWHMwithactionsrelatingtotheassignmentoftheleaseforSGL195BfromDominionTransmissiontoConsol. TheassignmentoftheleaseforSGL195BfromDominionTransmissiontoConsolwasgrantedbythePGCeffectiveMay18, 2010. CapouillezsignedthePGCConsenttoAssignmentofOilandGasLeaseonbehalfofthePGCinhispositionasBWHMDirector.

ConsolmadepaymentstoCapouilleztotaling $643.88duringtherelevanttimeperiodasaresultofadifferentleaseassignmentfromRangeResourcestoConsolinDecember2011. Capouillezwasnotspecificallyinvolvedinthenegotiationsofthatpartialassignment, andthepartiesareinagreementthattheamountCapouillezreceivedwasdeminimis.

ThepartieshavestipulatedthattheactionsofCapouillezastoConsoldonotgiverisetoaviolationoftheEthicsAct. See, StipulatedFinding105.

AstootheroilandgascompaniesreferencedintheStipulatedFindings, thepartieshavestipulatedthatanyactionsofCapouillezresulting inaprivatepecuniarybenefitoccurredpriortoJanuary10, 2009, andareoutsideoftheapplicablelimitationsperiod. 65Pa.C.S. § 1108(m).


EffectiveMarch18, 2014, PGCrescindeditsapprovalforCapouillez’ssupplementaryemploymentwith/throughGAL, afterreceivingrecommendationsfromthenGovernorCorbettandlegislativeleadersfortherevocationofCapouillez’ssupplementalemploymentauthorization.

HavinghighlightedtheStipulatedFindingsandissuesbeforeus, weshallnowapplytheEthicsActtodeterminetheproperdispositionofthiscase.

Theparties' ConsentAgreementsetsforthaproposedresolutionoftheallegationsasfollows:

3. Aspartofanegotiatedsettlementagreement, theInvestigativeDivisionwillrecommendthefollowinginrelationtotheaboveallegations:

a. ThataviolationofSection1103(a) ofthePublicOfficialandEmployeeEthicsAct, 65Pa.C.S. § 1103(a), occurredwhenMr. Capouillez, whileservingastheDirectoroftheBureauofWildlife \[Habitat\] Management, representedclientsthroughhisprivateconsultingbusiness, GAL, innegotiatingandexecutingleaseswithgascompanies, atatimeconcurrenttoPGCleasenegotiationswiththesamegascompaniesonunrelatedStateGameLandparcels, whichledtoapecuniarybenefittoMr. Capouillez/GAL.

b. TheInvestigativeDivisionhasconductedacomprehensiveinvestigationandreviewoftheallegationsascontainedaboveinparagraphtwo (2) \[oftheConsentAgreement\]. Aftersaidinvestigationandreview, anduponacarefulreviewofitsinvestigativefiles, theparties, bothInvestigativeDivisionandRespondent, haveagreedtosubmittheinstantConsentAgreementandStipulationofFindingsinsettlementofthematter.

4. Infullandfinalsettlementofthe allegedviolations, Mr. Capouillezagreestomakepaymentinthetotalsumof75,000.00 (the “SettlementAmount”) asprovidedinthis

paragraph.

a. $ 75,000.00payabletotheCommonwealthofPennsylvaniaandforwardedtothePennsylvaniaStateEthicsCommissionwithinthirty (30) daysoftheissuanceofthefinaladjudicationinthismatter. FollowingtheissuanceofaFinalOrder, anduponpaymentoftheSettlementAmount, Mr. CapouillezshallhavenofurtherfinancialobligationsunderthisConsentAgreementorotherwisearisingoutoftheallegedviolations.

5. TheInvestigativeDivisionshallrecommendthatthePennsylvaniaStateEthicsCommissiontakenofurtheractioninthismatterandshallmakenoreferralorrecommendationstoanylawenforcementorotherauthoritytotakeactionregardingtheAllegationsassetforthintheInvestigativeComplaint/FindingsReport. However, nothingshallprohibit


theInvestigativeDivisionfromseekingtoenforcethisConsentAgreementortheCommission’sFinalOrder.

ConsentAgreement, at2.

InconsideringtheConsentAgreement, weagreethataviolationofSection1103(a) oftheEthicsAct, 65Pa.C.S. § 1103(a), occurredwhenCapouillez, whileservingastheDirectoroftheBWHM, representedclientsthroughhisprivateconsultingbusiness, GAL, innegotiatingandexecutingleaseswithgascompanies, atatimeconcurrenttoPGCleasenegotiationswiththesamegascompaniesonunrelatedSGLparcels, whichledtoapecuniarybenefittoCapouillez/GAL.

AsDirectoroftheBWHM, Capouillez’sdutiesincludeddirectingthestatewidelandacquisitionandleasingprogram, whichincludedtheoil, gas, andmineralrecoveryprogram. TheBWHM’sDivisionofEnvironmentalPlanningandHabitatProtectionisprimarilyresponsiblefordeterminingtheSGLtractstobeleased, whenthetractsareofferedforlease, themethodbywhichtheleaseisawarded, andnegotiationofleasetermsincludingpayments. Capouillez’spositionasBWHMDirectorincludedresponsibilitiesandauthorityintheleasingprocesses.

CapouillezusedtheauthorityofhispublicpositionasDirectoroftheBWHMinperformingresponsibilitiesandexercisingauthorityastoPGCleasenegotiationsforSGLparcelswiththeveryoil/gascompanieswith whichheconcurrentlynegotiatedandexecutedleasesforprivateclientsthroughhisprivateconsultingbusiness, GAL.

Duringthetimeperiodunderreview, whileservingastheBWHMDirectorforthePGC, CapouillezrepresentedGALclientsinthecompetitivebidprocessbynegotiatingandexecutingleaseswithEXCO, atatimeconcurrentwithPGCleasenegotiationswithEXCOPAonSGLproperties, whichledto afinancialgaintoCapouillez/GALof31,358.70.

CapouillezactivelyrepresentedclientsthroughGALbeforeTalismanrepresentativesfortheleasingofprivatelandsandhadalsooriginallyservedasaconsultantforGALclientswhichwereultimatelyassignedtoTalisman, whilesimultaneouslyservinginthepositionoftheBWHMDirectorforthePGC, resultinginpaymenttoCapouillez/GALofanundeterminableamountduringthesametimeperiodTalismanwasengagedinanexistingbusinessrelationshipwiththePGCregardingtheleasingofSGLandwasactivelyinvolvedinnegotiationswithPGCrepresentativessupervisedbyCapouillezfortheleasingofadditionalSGL.

Capouillez’sinvolvementwiththeassignmentofSGLleaseswithAmericanExplorationCompanytoEQToccurredduringthesametimethathewasrepresentingGALclientswhoseleaseswithEMEwereassignedtoEQT. AlloftheleasesinitiallyexecutedbetweenprivatelandownersrepresentedbyCapouillez/GALandEMEwereassignedtoEQTinJune2010. Capouillezreceivedpaymenttotaling $56,301.34fromEQTasaresultoftheassignmentofthoseleasesfromEME, atatimewhenhewasalsoservingasDirectoroftheBWHM.

BasedupontheStipulatedFindingsandConsentAgreement, weholdthataviolationofSection1103(a) oftheEthicsAct, 65Pa.C.S. § 1103(a), occurredwhenCapouillez, whileservingastheDirectoroftheBWHM, representedclientsthroughhisprivateconsultingbusiness, GAL, innegotiatingandexecutingleaseswithgascompanies, atatimeconcurrenttoPGCleasenegotiationswiththesamegascompaniesonunrelatedSGLparcels, whichledtoapecuniarybenefittoCapouillez/GAL.

AspartoftheConsentAgreement, Capouillezhasagreedtomakepaymentintheamountof $75,000.00payabletotheCommonwealthofPennsylvaniaandforwardedto


thisCommissionwithinthirty (30) daysoftheissuanceofthefinaladjudicationinthismatter.

Atthisjuncture, wenotethattherearetimes, suchasinthiscase, wherethelegallycorrectresultisnotparticularlysatisfying. WerecognizethattherecommendedsettlementamountisafractionofthegainRespondent/GALisallegedtohavereceivedovertheyearsRespondentwasemployedbythePGC. However, wearedutyboundtoobservethelawandtoapplythelawinafairandobjectivemanner. Thestatuteoflimitationsissueisacriticalfactorinthiscase; itimpactsnotonlytheconductthatmaybereviewedinthiscase, butalso, asadirectconsequence, theamountofthefinancialpenaltythatmaybeordered. Baseduponafairandobjectiveapplicationofthelaw, andinlightofthetotalityofthefactsandcircumstances, wedeterminethattheConsentAgreementsubmittedbythepartiessetsforthaproperdispositionforthiscase.

Accordingly, pertheConsentAgreementoftheparties, RespondentCapouillezisdirectedtomakepaymentintheamountof $75,000.00payabletotheCommonwealthofthPennsylvaniaandforwardedtothisCommissionbynolaterthanthethirtieth (30) dayafterthemailingdateofthisadjudicationandOrder.

CompliancewiththeforegoingwillresultintheclosingofthiscasewithnofurtheractionbythisCommission. Noncompliancewillresultintheinstitutionofanorderenforcementaction.

IV. CONCLUSIONSOFLAW:

1. AstheDirectoroftheBureauofWildlifeHabitatManagement (“BWHM”) forthePennsylvaniaGameCommission (“PGC”) fromapproximatelyDecember2, 2006, throughMay18, 2015, RespondentWilliamCapouillez (“Capouillez”) wasapublicofficial/publicemployeesubjecttotheprovisionsofthePublicOfficialandEmployeeEthicsAct (“EthicsAct”), 65Pa.C.S. § 1101etseq.

2. AviolationofSection1103(a) oftheEthicsAct, 65Pa.C.S. § 1103(a), occurredwhenCapouillez, whileservingastheDirectoroftheBWHM, representedclientsthroughhisprivateconsultingbusiness, GeologicalAssessment & Leasing/GeologicalAssessment & Leasing, LLC (“GAL”), innegotiatingandexecutingleaseswithgascompanies, atatimeconcurrenttoPGCleasenegotiationswiththesamegascompaniesonunrelatedStateGameLandparcels, whichledtoapecuniarybenefittoCapouillez/GAL.

InRe: WilliamCapouillez, : FileDocket: 13-032Respondent : DateDecided: 8/10/16

DateMailed: 8/11/16

ORDERNO. 1695-21. AviolationofSection1103(a) ofthePublicOfficialandEmployeeEthicsAct

EthicsAct”), 65Pa.C.S. § 1103(a), occurredwhen WilliamCapouillezCapouillez”), whileservingastheDirectoroftheBureauofWildlifeHabitat

ManagementforthePennsylvaniaGameCommission (“PGC”), representedclientsthroughhisprivateconsultingbusiness, GeologicalAssessment & Leasing/GeologicalAssessment & Leasing, LLC (“GAL”), innegotiatingandexecutingleaseswithgascompanies, atatimeconcurrenttoPGCleasenegotiationswiththesamegascompaniesonunrelatedStateGameLandparcels, whichledtoapecuniarybenefittoCapouillez/GAL.

2. PertheConsentAgreementoftheparties, Capouillezisdirectedtomakepaymentintheamountof $75,000.00payabletotheCommonwealthofPennsylvaniaandforwardedtothePennsylvaniaStateEthicsCommission bynolaterthantheththirtieth (30) dayafterthemailingdateofthisOrder.

3. Compliancewithparagraph2ofthisOrderwillresultintheclosingofthiscasewithnofurtheractionbythisCommission.

a. Non-compliancewillresultintheinstitutionofanorderenforcementaction.

BYTHECOMMISSION,

NicholasA. Colafella, Chair

pa state ethics commission settlement with william capouillez

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