Brudvik Law Blog Posts

Timing is everything: the collapse of a ND oilfield business

Posted by Brett Brudvik | May 27, 2016 | 0 Comments

The failure of a business is never a pleasant experience. Sometimes, a market is overcrowded and the weaker businesses get left behind. For others, it may be poor management and incompetence. And yet others may be pulled under when an entire market fails, as when the dot-com bubble burst, the collapse of the real estate/construction market last decade, or the crash in oil prices in the last year.

The shutting down of a North Dakota oil field services company last year demonstrates the old saying that success has many parents, but that failure is an orphan. The company is in litigation on numerous fronts, with former employees, investors and other businesses all suing and counterclaiming each other.

Some from the entity claim a combination of bad contracts and the  market collapse caused the forced shut down. One investor called it a “confluence of incredibly unfortunate, concurrent events.”

The original founder of the business, however, felt some of the failures were due to a lack of experience and expertise within the oil industry. When things began to fail, he felt they reacted too slowly.

The company is now in the hands of a receiver. They also had problems with contractors, who they claim botched a welding inspection of a pipeline that cost the company $2.5 million to remedy.

North Dakota is also suing the company for the unpaid wages of the employees, and a labor union is arguing one of the owners of the pipeline project the company was hired to complete should help in paying those wages.

In complex litigation situations like this, it is necessary to have your own counsel to sort through the reams of documents that cases like this generate. It is also important not to delay, as there may be limited assets available and late claims may find their reward is nothing.

Source:, “ND oilfield business failure leaves workers unpaid, jobless,” Amy Dalrymple, May 22, 2016

About the Author

Brett Brudvik

Brett Brudvik works to serve clients in many areas of law. He specializes in probate, estate planning, real estate, land sales, business and corporate law, and business succession planning. He works with clients throughout Arizona, North Dakota, and Minnesota on these types of matters.   Brett a...


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