In Clayton Williams Energy, Inc. v. BMT O&G TX, L.P., a group of lessors sued lessee Chesapeake Exploration L.L.C. and farmee Clayton Williams Energy, Inc., asserting that Chesapeake's lease expired because it was developed under a farmout agreement rather than by Chesapeake itself. The trial court entered a multi-million dollar judgment and declared the lease terminated. On appeal, Chesapeake argued that Clayton Williams's timely development under the farmout agreement perpetuated the lease under its plain terms and that no evidence supported the trial court's damages award. The El Paso Court of Appeals agreed with Chesapeake, reversed the trial court's judgment in its entirety, and rendered judgment that the lessors take nothing on their claims. Clayton Williams Energy, Inc. v. BMT O&G TX, L.P., 473 S.W.3d 341 (Tex. App.--El Paso 2015, pet. denied).
Ryan Clinton's paper on Oil and Gas Damages was presented at the State Bar of Texas's Damages in Civil Litigation Conference in February 2015 by Davis, Gerald & Cremer sharehold Jad Davis.
Ryan's paper analyzes the appropriate damages measurements for frequently litigated oil-and-gas causes of action including royalty claims, implied obligations, trespass, negligence, nuisance, fraud, breach of contract, punitive damages, and slander of title.
To read Ryan's paper in full, click this link:
Oil and Gas Damages, State Bar of Texas, Damages in Civil Litigation Conference, February 2015
In Pioneer Natural Resources USA, Inc. v. Petroplex Energy, Inc., Petroplex claimed that Pioneer's lease had partially terminated and segregated into separate leases at the end of the lessee's continuous-development operations. Pioneer moved for summary judgment, arguing that production on the fully developed lease perpetuated the lease in its entirety, and that no language in the lease supported Petroplex's argument that production in any particular drilled area perpetuated the lease only as to that area. The trial court agreed with Pioneer and granted its motion for partial summary judgment.
In Tenaska Energy, Inc. v. Ponderosa Pine Energy, LLC, the trial court vacated a $125 million arbitration award in a dispute over the sale of a power plant. After the court of appeals reinstated the arbitration award, Tenaska appealed to the Supreme Court of Texas. Tenaska argued that the award should be vacated due to the evident partiality of the arbitrator, who failed to disclose the full scope of his contacts with opposing counsel and their law firm. The Texas Supreme Court agreed, vacated the $125 million arbitration award, and remanded for a new arbitration. Tenaska Energy, Inc. v. Ponderosa Pine Energy, LLC, 437 S.W.3d 518 (Tex. 2014).
Tenaska's Brief on the Merits
Supreme Court of Texas Opinion
In this large oil-and-gas dispute, Plaintiff Community Bank of Raymore asserted that the drilling rights of Defendants Chesapeake Exploration, L.L.C. and Anadarko Petroleum Corporation terminated as to certain deep depths. Plaintiff had two theories: (1) that a horizontal-termination clause had terminated Defendants’ deep-depth drilling rights at the expiration of the lease’s primary term; and (2) that a severance clause was triggered, effecting a partial termination of deep-depth drilling rights as to areas of the lease in which Defendants had already achieved production at the expiration of the primary term. On appeal, Defendants argued that neither partial-termination clause had been triggered because the lease continued to be held in full force, past the expiration of the primary term, by the lessee's continuous-development operations. After briefing and oral argument, the El Paso Court of Appeals sided with Defendants and affirmed the trial court’s judgment that Plaintiff take nothing on its claims. Community Bank of Raymore v. Chesapeake Exploration, L.L.C. & Anadarko Petroleum Corp., No. 08-12-00025-CV (Tex. App.–El Paso Nov. 6, 2013).
Chesapeake's Brief
Court of Appeals Opinion
In two related and novel oil-and-gas disputes, a group of investors leased to themselves partial mineral interests in West Texas properties based on a disputed fractional executive interest. The group asserted that they had inherited the stranded (or “naked”) fractional executive interest in the properties, which they in turn asserted gave them a right to considerable oil-and-gas profits after they executed a contract leasing the minerals to themselves. The trial court agreed with the investors and held that they were owed a substantial sum of back and future payments. Ryan Clinton led the appellate efforts and presented oral argument on behalf of Defendants/Appellants Chesapeake Exploration, L.L.C. and Anadarko Petroleum Corporation. After briefing and argument, the court of appeals reversed and rendered judgment that the investors take nothing from Chesapeake and Anadarko. The court held that the investors did not own the executive interest upon which they based their claims, but instead that a non-party to the dispute had previously purchased the disputed executive rights. Chesapeake Exploration L.L.C. v. BNW Property Co., No. 08-11-00239-CV, 2012 WL 5987573 (Tex. App.—El Paso Nov. 30, 2012, no pet. h.); Anadarko Petroleum Corp. v. BNW Property Co., No. 08-11-00238-CV, 2012 WL 5987570 (Tex. App.—El Paso Nov. 30, 2012, no pet. h.).
Anadarko's Response to Petition for Review
Court of Appeals Opinion
In Occidental Permian Ltd. v. Helen Jones Foundation, et al., a group of Texas royalty owners alleged that OPL, an oil and gas producer, had underpaid royalties for casinghead gas produced during carbon dioxide-injection tertiary recovery operations in West Texas. After the jury reached a multi-million dollar verdict for the plaintiffs, OPL appealed and the Amarillo Court of Appeals reversed the trial court’s judgment, concluding that no evidence supported the jury’s findings. The court of appeals rendered judgment that the plaintiffs take nothing against OPL. Occidental Permian Ltd. v. Helen Jones Foundation, 333 S.W.3d 392 (Tex. App.—Amarillo Jan. 31, 2011, pet. denied).
Occidental's Response to Petition for Review
Court of Appeals Opinion
In Petroleum Synergy Group, Inc. v. Occidental Permian, Ltd., the owner of an overriding royalty interest in an oil-and-gas lease sued Occidental, claiming that Occidental breached its implied covenant to prevent substantial drainage from the leased acreage. The trial court entered judgment on the jury's verdict that Occidental did not fail to prevent substantial drainage, and the plaintiffs appealed. The Amarillo Court of Appeals affirmed, holding that the plaintiffs did not demonstrate substantial drainage as a matter of law. Petroleum Synergy Group, Inc. v. Occidental Permian, Ltd., 331 S.W.3d 14 (Tex. App.--Amarillo 2010, pet. denied).
Occidental Permian's Brief on the Merits
Court of Appeals Opinion
In Rusty’s Weigh Scales v. North Texas Scales, the plaintiff alleged that NTS misappropriated trade secrets when it repaired industrial weighing scales originally sold and programmed by the plaintiff. After briefing and argument, the court of appeals affirmed the trial court’s judgment in favor of NTS, concluding that the plaintiff provided insufficient evidence to support any damages award. Rusty’s Weigh Scales v. North Texas Scales, 314 S.W.3d 105 (Tex.App.—El Paso 2010, no pet.).
In Manchester Tank & Equipment Co. v. Engineered Controls International, Inc., the manufacturer of a gas cylinder sued the manufacturer of a valve assembly installed on the cylinder after both parties settled personal-injury claims brought against them in a separate action. The trial court held that under Texas law, the two companies held off-setting indemnification claims against each other and rendered judgment that the cylinder manufacturer take nothing. The cylinder manufacturer appealed to the Waco Court of Appeals, which affirmed the trial court's take-nothing judgment. Manchester Tank & Equipment Co. v. Engineered Controls International, Inc., 311 S.W311 S.W.3d 573 (Tex. App.--Waco 2009, pet. denied).
ECII's Response to Petition for Review
Court of Appeals Opinion
In State v. Lueck, a governmental employee was terminated after a vendor charged the State hundreds of thousands of dollars for disputed work. The employee then sued the State, claiming that an e-mail he previously wrote to his supervisor protected his conduct under the Texas Whistleblower Act. The State, represented by Ryan Clinton, appealed to the Texas Supreme Court, arguing that the substantive elements of the Whistleblower Act limited the jurisdiction of Texas courts, and that the plaintiff’s claim fell outside the Act’s waiver of immunity from suit and liability. After briefing and oral argument, the Texas Supreme Court agreed and dismissed the suit for lack of subject-matter jurisdiction. State v. Lueck, 290 S.W.3d 876, 886 (Tex. 2009).
In addition to State v. Lueck, Ryan Clinton handled two more cases in the Texas Supreme Court on the same issue. The Court also held for the state agency at issue in each of the two additional companion cases. See Texas Dept. of Health & Human Services v. Okoli, 440 S.W.3d 611 (Tex. 2009); Texas Dept. of Transp. v. Garcia, 293 S.W.3d 195 (Tex. 2009).
State of Texas's Brief
Supreme Court of Texas Opinion (Lueck)
In In re Waller Independent School District, the school district petitioned the Texas Supreme Court to issue a writ of mandamus to force the Texas Attorney General to approve public securities even though the validity of those securities was contested in pending litigation. The Supreme Court required the Attorney General to file a brief in response to the petition, which was filed 11 days later. After receiving the Attorney General's response, the Supreme Court denied the school district's petition. In re Waller Indep. Sch. Dist., No. 08-0079 in the Supreme Court of Texas.
Attorney General's Brief
In Texas Parks & Wildlife Department v. E.E. Lowrey Realty, Ltd., the Texas Supreme Court resolved a conflict among the courts of appeals over whether an employee of a governmental agency sued in his or her official capacity is entitled to interlocutory review of the denial of a plea to the jurisdiction. The Court held that the employee is entitled to interlocutory review, and that under the facts of the case, the state governmental entity and its employees sued in their official capacity were protected by sovereign immunity from suit because the Texas Legislature has not waived sovereign immunity for suits for alleged property damage arising from a dangerous condition.
Texas Parks and Wildlife's Brief on the Merits
Texas Supreme Court Opinion
In Texas A&M University v. Bading, several third-party contractors sued Texas A&M University, arguing that the University was financially responsible for any claims brought against the third-party contractors by victims of the tragic collapse of the Aggie Bonfire. The trial court denied Texas A&M's plea to the jurisdiction and the university appealed. At the Waco Court of Appeals, Texas A&M argued that the university was immune from plaintiffs' suit for contribution and indemnity because the Texas Legislature had not waived sovereign immunity for contribution and indemnity claims. The Waco Court agreed, writing that "because there is no statute or resolution of the Legislature authorizing them, the doctrine of sovereign immunity bars all of [the plaintiffs'] claims." Tex. A&M Univ. v. Bading, 236 S.W.3d 801 (Tex. App.--Waco 2007, pet. dism'd as improvidently granted).
In In re the Honorable Errlinda Castillo, a sitting justice on Texas's Thirteenth Court of Appeals filed a petition for writ of mandamus against the Thirteenth Court of Appeals as a whole and its other sitting justices. Justice Castillo brought the petition after the court enacted a transition plan that limited Justice Castillo's assignment of additional opinions after Justice Castillo lost a bid for reelection to the court. After the Thirteenth Court amended its transition plan in response to Justice Castillo's petition, the remaining justices argued that her petition was without merit because appellate justices may have a constitutional right to participate in appellate proceedings but they have no entitlement to initial authorship of majority opinions. The Texas Supreme Court agreed, denying Justice Castillo's petition for writ of mandamus.
The Thirteenth Court's Brief
The Texas Supreme Court Opinion
In In re Commitment of Fisher, the Texas Supreme Court was asked to determine the constitutionality of the Texas Civil Commitment of Sexually Violent Predators Act. The Act permits the State of Texas to commit a sexual predator to outpatient treatment and supervision upon release from a prison or state hospital. The court of appeals had struck the Act as violating the United States Constitution. Ryan Clinton's petition for review earned the rare distinction of leading the Texas Supreme Court to grant the petition before requesting or receiving full briefing on the merits. Ultimately, the Texas Supreme Court reversed the court of appeals's judgment and fully upheld the constitutionality of the statute. In re Commitment of Fisher, 164 S.W.3d 637 (Tex. 2005).
State of Texas's Brief
Texas Supreme Court Opinion