Last Friday, the Supreme Court of Texas issued decisions in two companion cases, No. 05-1076; Exxon Corp., et al. v. Emerald Oil & Gas Co., et al. (“Miesch”), and No. 05-0729; Exxon Corp., et al. v. Emerald Oil & Gas Co. (“Emerald”). Butch Marseglia, counsel in Liskow & Lewis’s Houston office, submitted a brief for the Texas Oil & Gas Association (“TxOGA”) as amicus curiae.
In Emerald, the Court held that Section 85.321 of the Texas Natural Resources Code creates a private cause of action, but it does not extend to a subsequent lessee against a prior lessee for damages to the subsequent lessee’s interest. Because the plaintiff Emerald owned no interest in the mineral leases when the prior lessee allegedly damaged the interest, the plaintiff lacked standing to assert the cause of action the Court recognizes under section 85.321. The Court also held that Emerald also lacked standing to bring a claim against its prior lessee based on negligence per se.
In Miesch, the Court held that statutory and common law waste, negligence per se, negligent misrepresentation, and tortious interference claims against the former lessee were time-barred. The Court also held that no evidence supported the lessors’; claim for breach of development claims under the oil and gas lease. Finally, the court affirmed the court of appeals’ judgment, for different reasons, reversing the trial court’s directed verdict with respect to fraud claims based on allegedly misrepresentation in Railroad Commission plugging reports filed by the former lessee, and remanded that claim to the trial court for further proceedings.
Click here for a link to the Miesch decision.