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M&A Litigation
Bankruptcy Court Strikes Former Counsel's Affidavit Supporting Adverse Party in Working Interest Dispute
Joel Reese | Jul 20, 2026
The Southern District of Texas Bankruptcy Court struck an affidavit submitted by Larry Jacobs, former counsel to HB2 Origination, LLC, in support of Alpine Non-Op LLC's summary judgment motion seeking a declaratory judgment that non-operating working interests in oil and gas leases were not property of the bankruptcy estate. The court held that Jacobs breached his duty of loyalty under Texas Disciplinary Rules of Professional Conduct Rule 1.09(c) by submitting an affidavit containing information relating to his prior representation of HB2 on the same subject matter, directly adverse to his former client.
Ninth Court of Appeals Affirms Specific Jurisdiction Over Nonresident in Papua New Guinea Oil Interest Dispute
Joel Reese | Jul 20, 2026
The Beaumont Court of Appeals affirmed personal jurisdiction over a nonresident defendant in litigation involving allegations that he conspired with an oil company president to defraud a deceased attorney out of a 0.5% interest in Papua New Guinea exploration valued at $19 million. The court held that the defendant purposefully availed himself of the privilege of conducting activities in Texas and that the claims arose from those contacts, satisfying the two-prong test for specific jurisdiction under Texas's long-arm statute.
Fifth Circuit Vacates Bankruptcy Court's 'Single Satisfaction' Violation in Sanchez Energy Reorganization
Joel Reese | Jul 20, 2026
The Fifth Circuit vacated a bankruptcy court's equity allocation in the Sanchez Energy reorganization, holding that the court violated 11 U.S.C. ยง 550(a) by awarding unsecured creditors both the return of avoided liens on oil and gas leases and the value of those liens. The dispute centered on $500 million in secured notes backed by nonpossessory liens on virtually all corporate assets, including the HHK Leases, which were worth more than all other Sanchez assets combined.
First Court Reverses Temporary Injunction Freezing Crude Oil Broker's Assets Over $5.6 Million Payment Dispute
Joel Reese | Jul 20, 2026
A crude oil purchasing company sought to freeze $2.18 million in assets of a broker that failed to pay for 79,310 barrels of crude oil delivered in March 2023, claiming the broker's downstream counterparty Delek's nonpayment created an insolvency event under the parties' agreement incorporating ConocoPhillips General Terms and Conditions. The Houston First Court of Appeals reversed the trial court's temporary injunction, finding Apricus failed to establish irreparable harm where Axis maintained $4 million in cash and $33.6 million in receivables despite the payment dispute.
Business Court Construes Force Majeure Carve-Out in Industry Form Gas Contract: No Duty to Purchase Spot-Market Gas
Joel Reese | Jul 20, 2026
Marathon Oil declared force majeure during a winter storm and delivered less natural gas than contracted to energy trader Mercuria Energy America, triggering a breach of contract dispute over whether Marathon was required to purchase spot-market gas to fulfill delivery obligations. The Business Court of Texas held that the contract's force majeure provision relieved Marathon of any obligation to seek alternative gas supplies including spot-market purchases, construing 'seller's gas supply' to refer only to gas Marathon had available and not gas available for purchase on the spot market.
Texas Business Court Divides Trade Secret Settlement Proceeds 50-50 Between Co-Developers Despite Funding Disparity
Joel Reese | Jul 20, 2026
The Business Court of Texas held that Mesquite Energy and Sanchez Oil & Gas were co-owners of trade secrets arising from a cost-reduction drilling project, entitling each to 50% of settlement proceeds from misappropriation litigation against former employees, despite Mesquite having funded the project's development. The court further ordered Sanchez to reimburse Mesquite for half of the attorneys' fees incurred prosecuting the trade secret case under unjust enrichment principles.
Southern District of Texas Grants Class Certification in Anadarko Securities Fraud Case After Fifth Circuit Remand on Expert Testimony Standards
Joel Reese | Jul 20, 2026
Following Fifth Circuit remand, the Southern District of Texas granted class certification in institutional investors' securities fraud action against Anadarko Petroleum and senior executives for allegedly misrepresenting viability and profitability of a deepwater Gulf of Mexico oil field project. The court denied cross-motions to exclude expert testimony, finding both investors' rebuttal report and defendants' surreply report on sunk-cost valuation principles satisfied Daubert reliability standards.
Business Court Enforces NAESB Transaction Confirmations in Natural Gas Force Majeure Dispute
Joel Reese | Jul 20, 2026
Marathon Oil successfully defended its force majeure declaration after the Business Court of Texas held that a pipeline delivery term in its transaction confirmation became binding despite Mercuria's failure to check a box or expressly object to the term. The court ruled that timely transaction confirmations did not materially differ and combined with the parties' NAESB base contract to form an integrated agreement supporting Marathon's reduced delivery obligations.
Delaware Chancery Holds Purchase Price Adjustment Does Not Bar Indemnification for Same Breach Absent Exclusivity Language
Joel Reese | Jul 14, 2026
Delaware Chancery held that a post-closing purchase price adjustment favoring the seller does not bar the buyer from seeking indemnification for the same adjustment payment where the adjustment resulted from breached representations or warranties. The decision in Golden Rule Financial Corporation v. Shareholder Representative Services LLC rejected the seller's argument that the adjustment mechanism was the exclusive remedy, finding that absent explicit exclusivity language, a broadly drafted indemnity provision with anti-duplication language permits recovery when the adjustment itself traces to a rep breach.
Fort Worth Court of Appeals Voids $950,000 Crane County Asset Sale for Lack of Consideration Due to Buyer's Unfettered Discretion
Joel Reese | Jul 06, 2026
The Fort Worth Court of Appeals reversed a specific performance order for a $950,000 Crane County oil and gas asset sale, holding that the buyer's "sole discretion" to walk away after due diligence rendered its promise illusory and the letter agreement unenforceable for want of consideration. Applying binding precedent from Culbertson v. Brodsky, the court ruled that absent separate consideration for the option period, Cooper's unlimited discretion to terminate undermined mutuality of obligation.
Texas Court of Appeals Affirms Expert Exclusion and No-Evidence Summary Judgment in $4.8 Million Texas Panhandle Working Interest Dispute
Joel Reese | Jul 06, 2026
Following remand from the Texas Supreme Court, the Eastland Court of Appeals was tasked with determining whether the trial court abused its discretion in excluding Apollo's damages expert Peter Huddleston and whether the no-evidence summary judgment was proper in a dispute over 75% of working interests in 109 Texas Panhandle leases covering 120,000 acres. The case arose from March 2011 purchase and sale agreements between Apollo, Gunn Oil Company, and Apache Corporation, ultimately resulting in a final judgment awarding Apache $4,800,000 in attorneys' fees.
Texas Business Court Enforces Drag-Along Rights in PE-Backed E&P Sale, Rejects Enhanced Fiduciary Duty Claims
Joel Reese | Jul 06, 2026
Texas Business Court enforced drag-along rights in Primexx Energy Corporation's forced sale to Callon Petroleum, granting partial summary judgment against PE-backed limited partners who sought to impose common law fiduciary duties requiring enhanced sale processes beyond the partnership agreement's express contractual terms. The court denied summary judgment on post-closing waterfall allocation mechanics and sidecar entity valuation issues that will proceed to trial.
Texas Business Court Splits Eagle Ford Trade Secret Settlement Proceeds Based on Joint Development, Orders Expense Reimbursement Despite Post-Bankruptcy Settlement
Joel Reese | Jul 06, 2026
Following the second-ever Texas Business Court trial, Judge Barnard split trade secret misappropriation settlement proceeds 50/50 between post-bankruptcy Mesquite Energy (f/k/a Sanchez Energy Corporation) and Sanchez Oil & Gas Corporation, holding that joint development of Eagle Ford cost-saving initiatives created co-ownership rights despite Sanchez Energy providing all funding for the underlying proprietary methods. The court further ordered Sanchez Oil & Gas to reimburse half of pre-bankruptcy litigation expenses under unjust enrichment theory, finding the parties' 2022 post-bankruptcy settlement agreement did not bar the reimbursement claim.
Texas Business Court Enforces Survival Period Deadline, Holds Assumed Liabilities Provisions Do Not Create Independent Indemnification Rights in Pipeline Asset Sale
Joel Reese | Jul 06, 2026
Plains Pipeline sought indemnification from Arrowhead Gulf Coast Holdings for Louisiana erosion litigation costs arising from a 2016 pipeline asset sale, arguing the purchase agreement's 'assumed liabilities' language created perpetual indemnification obligations independent of the contract's Article X indemnity provisions. The Texas Business Court granted summary judgment for buyers, holding that sellers' indemnification claims failed because they missed the contractual survival period deadline and that assumed liabilities provisions do not override express indemnity survival terms or exclusive remedy clauses.
ICC Tribunal Awards Chevron $6.2 Billion in Specific Performance Enforcing ROFR Against Hess-ExxonMobil Merger for Guyana Stabroek Block Assets
Joel Reese | Jun 25, 2026
An ICC tribunal awarded Chevron Corporation $6.2 billion in specific performance blocking Hess Corporation's transfer of its 30% working interest in the Guyana Stabroek Block to ExxonMobil, ruling that Chevron's right of first refusal under the 2014 joint operating agreement was triggered by the October 2023 merger announcement. The award includes $340 million in damages for Hess's breach of ROFR notice provisions and requires unwinding the asset transfer, presenting critical implications for ROFR enforcement in upstream M&A transactions.
Fifth Circuit Clarifies When Creditors May Pursue Direct Claims Against Secured Lenders in Oil & Gas Bankruptcies
Joel Reese | Jun 02, 2026
The Fifth Circuit held that unsecured bondholders' fraud claims against Chesapeake Energy, a secured creditor of bankrupt Seven Seas Petroleum, were not property of the bankruptcy estate because they alleged direct injury to bondholders independent of harm to the debtor. The decision establishes that creditors may pursue their own state-law claims against secured lenders who allegedly participated in fraudulent conduct that directly induced bond purchases, even after a confirmed bankruptcy plan releases the secured creditor from liability.