Date: 09-22-2015

Case Style: Blueknight Energy Partners, L.P. v. Semgroup, LP., Semmanagement, L.L.C. and Rose Rock Midstream, L.P.

Case Number: CJ-2012-2412

Judge:

Court: District Court, Tulsa County, Oklahoma

Plaintiff's Attorney: Ryan Ray and Jo Lynn Jeter

Defendant's Attorney: Richard Love and Jason Taylor

Description: Tulsa, OK - Blueknight Energy Partners, L.P. sued Semgroup, LP., Semmanagement, L.L.C. and Rose Rock Midstream, L.P. on breach of contract theories claiming:

1. SemGroup is a Delaware corporation with its principal place of business in Tulsa County, Oklahoma. SemOroup does not maintain any office in Oklahoma County, Oklahoma.2 See Affidavit of Robert N. Fitzgerald, attached hereto as Exhibit “A”.
2. SemCrude, L.P., n/k/a Rose Rock Midstream Crude, L.P. (“SemCrude”) is a Delaware Limited Partnership with its principal place of business in ThIsa County, Oklahoma. SemCrude does not maintain any office in Oklahoma County, Oklahoma. See n. 2 and Exhibit
3. SemManagement, L.L.C. (“SemManagement”) is a Delaware Limited Liability Company with its principal place of business in Tulsa County, Oklahoma. SemManagement does not maintain any office in Oklahoma County, Oklahoma. See n. 2 and Exhibit “A”.
4. Rose Rock Midstream, L.P. (“Rose Rock”) is a Delaware Limited Partnership with its principal place of business in Tulsa County, Oklahoma. Rose Rock does not maintain any office in Oklahoma County, Oklahoma. See n. 2 and Exhibit “A”.
5. Blue Knight Energy Partners, L.P. (“BKEP”) is a Delaware Limited Partnership with its principal place of business in Tulsa County, Oklahoma. See, excerpt of BKEP’s 2011 Form 10-K filed with the Securities and Exchange Commission, appended hereto as Exhibit “C”, listing Two Warren Place, 6120 South Yale Avenue, Suite 500, Tulsa, Oklahoma, as the address of BKEP’s principal executive offices.
6. On or about April 7, 2009, Defendant SemCrude, Defendant SemManagement,
and Plaintiff SKEP (f/Ic/a SemGroup Energy Partners, L.P.), among other entities not made parties to the above-styled action, entered into a Shared Services Agreement (the “SSA”) to become effective as of 11:59 PM CDT March 31, 2009. See Shared Services Agreement, attached hereto as Exhibit “1)”.
7. The SSA was entered into in Tulsa County. Affidavit of Peter Schwiering, attached hereto as Exhibit “E”.
8. All parties to this action maintain their principal accounting offices in Tulsa County. See Exhibit “E”.
9. As the Service Provider under the SSA, SemCrude and SemManagement were obligated to perform certain services for the benefit of the crude related operations of the Service Recipients, including, in pertinent part, coordination of the transportation of crude product as well as services related to the operation and maintenance of certain pipelines and storage tanks for a period of 36 months, in addition to services related to SCADA control room operations for a period of five (5) years. See Exhibit “D”, at Exhibits A-C.
10. All of these SSA services were rendered outside of Oklahoma County. See Exhibit “E”.
11. On February 14, 2012, BKEP filed the above-styled petition against SemCrude and SemManagement — both parties to the SSA — as well as SemGroup and Rose Rock, which are indirect parent entities of SemCrude and are not parties to the SSA. See BKEP’s Petition, attached hereto as Exhibit “F”.
12. In its Petition, SKEP seeks to hold Defendants liable in fraud. See Exhibit “F”, at ¶36.
13. As the sole factual support for its fraud claims, BKEP alleges that:
During 2010, the Defendants misrepresented to [BKEP] the nature and extent of their handling and movement of [BKEP] ‘ s crude oil in and out of the Oklahoma Pipeline and the Cushing Terminal both operated by the Defendants at the
relevant time.

Outcome: 09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
1 ROSE ROCK MIDSTREAM LP
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
1 SEMCRUDE LP
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
1 SEMGROUP CORPORATION
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
1 SEMMANAGEMENT LLC
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
2 BLUEKNIGHT ENERGY PARTNERS LP
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
3 BLUEKNIGHT ENERGY PARTNERS LP
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
4 BLUEKNIGHT ENERGY PARTNERS LP
09-22-2015 DISPCVDMWP

DISMISSAL WITH PREJUDICE
5 BLUEKNIGHT ENERGY PARTNERS LP

Plaintiff's Experts:

Defendant's Experts:

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