No. 01-15-00108-CV

________________________________________________ 

IN THE COURT OF APPEALS 

FIRST DISTRICT OF TEXAS 

HOUSTON, TEXAS 

_________________________________________________ 

Premium Valve Services, LLC 

Appellant 

v.

Comstock Oil & Gas, LP, Comstock Oil & Gas- Louisiana, LLC

and Certain Underwriters 

Appellees 

On Appeal from the 270th Judicial District Court 

Harris County, Texas 

Trial Court Cause No. 2009-65461 

___________________________________ 

REPLY 

BRIEF OF APPELLANT 

PREMIUM VALVE SERVICES, LLC

_____________________________________________________ 

H. Dwayne Newton 

State Bar of Texas No. 14977200 

dnewton@newton-lawyers.com

Cynthia L. Jones 

State Bar of Texas No. 00852600 

cljones@newton-lawyers.com

NEWTON,JONES & SPAETH

3405 Marquart 

Houston, TX 77027 

Telephone: 713-493-7620 

Facsimile: 713-493-7633 

ORAL ARGUMENT IS REQUESTED

ACCEPTED

01-15-00108-CV

FIRST COURT OF APPEALS

HOUSTON, TEXAS

9/17/2015 8:52:43 AM

CHRISTOPHER PRINE

CLERK

 FILED IN 1st COURT OF APPEALS HOUSTON, TEXAS 9/17/2015 8:52:43 AM CHRISTOPHER A. PRINE Clerk
i

TABLE OF CONTENTS

TABLE OF CONTENTS............................................................................................i

INDEX OF AUTHORITIES..................................................................................... ii

INTRODUCTION AND SUMMARY OF REPLY..................................................1

ARGUMENT AND AUTHORITIES........................................................................2

Reply Issue No. 1....................................................................................................2

Appellees admit there is no finding of permanent injury to the Collins #1 

well. Without such a finding, there is no basis for any award that includes 

costs of redrilling another well or for market value, and thus, the judgment 

entered by the trial court is erroneous.

Reply Issue No. 2....................................................................................................6

The cases cited by Appellees do not support the award of market value 

plus costs of remediation, but instead establish the error in the judgment 

below.

CONCLUSION AND PRAYER .............................................................................10

CERTIFICATE OF SERVICE ................................................................................12

CERTIFICATE OF COMPLIANCE.......................................................................12
ii

INDEX OF AUTHORITIES

Cases

Atex Pipe & Supply Inc.,

736 S.W. 2d 914 (Tex. App. – Tyler 1987, writ denied)...........................................3

Basin Oil Co. of Cal. v. Baash-Ross Tool Co., 

125 Cal. App. 2d 578 (1954) ...................................................................................10

Cressman Tubular v. Kurt Wiseman Oil, 

322 S.W.3d 453 (Tex. App. – Houston [14th Dist.] 2010, pet. denied).....................3

Dowell, Inc. v. Cichowski, 

540 S.W.2d 342 (Tex. Civ. App. – San Antonio 1976, no writ)...............................9

Dresser Indus. v. Page Petroleum, Inc., 

853 S.W.2d 505 (Tex. 1993)............................................................................. 6, 7, 8

Gilbert Wheeler, Inc. v. Enbridge Pipelines, 

449 S.W.3d 474 (Tex. 2014)............................................................................. 2, 3, 4

United States Torpedo Co. v. Liner, 

300 S.W. 641 (Tex. Civ. App – Eastland 1927) (reversed on other grounds)...........9
1

No. 01-15-00108-CV

________________________________________________

IN THE COURT OF APPEALS

FIRST DISTRICT OF TEXAS

HOUSTON, TEXAS

_________________________________________________

Premium Valve Services, LLC

Appellant

v.

Comstock Oil & Gas, LP, Comstock Oil & Gas- Louisiana, LLC

and Certain Underwriters

Appellees

___________________________________

REPLY

BRIEF OF APPELLANT

PREMIUM VALVE SERVICES, LLC

_____________________________________________________

TO THE HONORABLE FIRST COURT OF APPEALS

INTRODUCTION AND SUMMARY OF REPLY

Appellants file this Reply to Appellees’ Brief to address two important points 

made by Appellees that actually serve to highlight the problems with the judgment 

entered by the trial court in this case, and establish it cannot stand. First, Appellees 

acknowledge there has been no finding of permanent injury. This fact is fatal to 

Appellees’ case, since every case cited in support of their damages is dependent on 

a finding of permanent damage. Second, based on the current, applicable case law 

cited by Appellees, the damages awarded by the trial court are erroneous. 
2

ARGUMENT AND AUTHORITIES

REPLY ISSUE NO. 1

Appellees admit there is no finding of permanent injury to the Collins #1 well. 

Without such a finding, there is no basis for any award that includes costs of 

redrilling another well or for market value, and thus, the judgment entered by 

the trial court is erroneous.

Appellees admit neither the trial court nor the jury concluded the Collin’s #1 

well was permanently damaged as a result of the blowout. (Appellees’ Brief at p. 

42). Yet Appellees’ Counter-Issues and all of their arguments throughout their brief 

simply presume the well was completely destroyed The Texas Supreme Court has 

unequivocally held the measure of damages in any case involving damage to real 

property is dependent on whether the damage is permanent or temporary. Appellees 

dismiss this binding precedent, instead insisting the only question the jury did not 

answer was whether or not one particular well was in fact a replacement for the well

claimed to be damaged. The admission by Appellees that there has been no finding 

of permanent injury amounts to an admission of reversible error warranting a new 

trial. 

The proper measure of damages in cases involving damage to real property is 

either the cost to restore the property, or, if restoration is not possible, the loss in fair 

market value of the property. Gilbert Wheeler, Inc. v. Enbridge Pipelines, 449 

S.W.3d 474 (Tex. 2014). In Gilbert Wheeler, Inc. the Court discussed at length the 

purpose and necessity of the requirement of distinguishing between permanent and 
3

temporary damage in all real property cases. Id. 478-480. And as a matter of law, 

damage to an oil or gas well is damage to real property. Cressman Tubular v. Kurt 

Wiseman Oil, 322 S.W.3d 453 (Tex. App. – Houston [14th Dist.] 2010, pet. denied); 

Atex Pipe & Supply Inc.,736 S.W. 2d 914 (Tex. App. – Tyler 1987, writ denied).

Because Gilbert Wheeler, Inc. involved trees and not damage to an oil well, 

Appellees simply say the requirement distinguishing between permanent and 

temporary damages does not apply. (Appellees’ Brief at 31) Appellees appear not 

to understand that Gilbert Wheeler, Inc. is completely consistent with the cases they 

have cited. The problem with Appellees’ argument, is that in all of the cases they 

cite, such as Atex, Dresser, and Dowell, prior to entry of judgment there was either 

a finding the well in question was completely destroyed, or it was not an issue in 

dispute. (See Appellant’s Brief at p. 12 – 13) But in this case, whether or not the 

well was beyond repair as a result of the blow-out, or whether it could in fact have 

been repaired, was a central disputed issue throughout the case, and extensive 

evidence on the issue was presented by both sides. A question therefore should 

have been submitted to the jury to enable the Court to make a finding as to whether 

or not the injury was permanent or temporary. The question Appellant offered would 

have accomplished that. 

Had the jury been allowed to answer the question submitted by Appellants, 

there would be a basis for a conclusion one way or the other, as to whether the injury 
4

to the well was permanent or temporary. If the jury believed the well was capable 

of being repaired as a result of the blowout, then the injury was temporary. If the 

jury believed the well was not capable of being repaired as a result of the blowout, 

then the injury was permanent. With these findings, the proper measure of damages 

could have been applied.

Appellees’ suggestion that the question tendered by Appellants and rejected 

by the court was an inferential rebuttal issue that could only have been submitted as 

an instruction is simply false. The issue of whether an injury is temporary or 

permanent is a question of law, but any factual issues that have to be resolved must 

be submitted in the form of a question to the jury. Gilbert Wheeler, Inc., at 449 S. 

W. 3d at 481. The fact issue as framed in the question tendered by Appellants was 

whether or not the well could have been repaired as a result of the blow-out, the 

answer to which would have provided the Court with a factual basis for finding a

permanent or temporary injury.

Appellees’ argument that Appellant did not properly object to the failure to 

submit the question on the proper basis is also false. In tendering the question to the 

Court, Appellant’s counsel objected to the failure to submit, advising specifically

the question was a “necessary foundational question for the Court to submit” and 

that without this finding, there would be an “absence of a necessary jury finding on 

a question of fact” as to whether or not there could be recovery for drilling another 
5

well. Thus, the court was advised a fact question existed which had to be determined 

by the jury in order to support the damages requested. 

Further, it was Appellees’ burden of proof to establish that all of the damages 

sought were caused by the occurrence. Appellees admitted in the trial court below, 

and admit in their Brief here they failed to submit a necessary foundational question

to support recovery of the damages awarded. Yet in their Brief, they suggest that 

the proper measure of damages is predicated solely on the fact that the jury found 

that Appellant was 100% negligent in causing the blowout, and has nothing to do 

with the permanency of the injury. (Appellants’ Brief at 32) If that were true, then 

there would be no reason for Appellees to have ever concerned themselves at trial 

with putting on any proof at all regarding the reasonableness of its actions following 

the blowout, nor would they have needed to ask the trial court to make an omitted 

finding. 

In their Brief, Appellees claim that in their motion for omitted finding in the 

trial court, they asked for a finding of whether the well could be reproduced. But 

this is not what was requested. Instead, they tried to sidestep the real issue of 

permanent v. temporary injury, and asked the court only to make a finding as to 

whether or not the Collins #2 well was a replacement for the Collins #1 well: 

. . . Plaintiffs in the above-entitled cause, move the Court to make an

omitted finding of fact: namely, on whether the Collins #2 Well was a 

replacement well for the Collins #1 Well that the jury found was lost as 

a result of Defendant PVS’ fault.
6

If the Court finds the Collins #2 WAS NOT a replacement well, 

then Plaintiffs move for a judgment in conformance with the jury’s 

verdict and the trial court’s finding. If the Court finds the Collins #2 

well WAS a replacement well, then Plaintiffs move for a judgment 

notwithstanding the jury’s verdict as to damage issue 4(c) (reasonable 

and necessary cost to re-drill and complete a replacement well) but 

based on the rest of jury’s verdict.

(CR 531) Notably, Appellees’ request for omitted finding presumed the jury found 

that the Collins #1 “was lost as a result of the blowout” – a finding that did not exist

because no question was submitted to the jury that would have supported a finding 

of permanent injury. Here, Appellees specifically admit there was no finding of 

permanent injury made by the jury or by the court. 

A fact issue existed as to whether or not the well was repairable. This fact 

issue was never submitted to the jury. Therefore, no finding of permanent injury to 

the well could have been properly made, resulting in the rendition of a judgment that 

is not supported and is inconsistent with the jury’s answers to the charge.

REPLY ISSUE NO. 2

The cases cited by Appellees do not support the award of market value plus 

costs of remediation, but instead establish the error in the judgment below.

Even if the trial court had properly made a finding of permanent injury, the 

damages it awarded are simply wrong, and do not comport with the current, 

applicable case law cited by Appellees. Appellees argue based on Dresser v. Page 

Petroleum, the judgment here is correct, since in Dresser, the court noted that costs 

of remediation were reasonable and necessary expenses in an attempt to save the 
7

well. Dresser Indus. v. Page Petroleum, Inc., 853 S.W.2d 505, 511-512 (Tex. 1993); 

(Appellee’s Brief at 47). But Appellees’ argument is misleading, since in Dresser, 

the costs of remediation were NOT awarded. 

In Dresser, Houston Fishing was found 40% negligent in causing damage to 

a well, which was ultimately plugged and abandoned, forcing the drilling of a new 

well. The jury found that the difference in the market value before and after the 

damage was $836,000.00. The jury also found the reasonable and necessary cost of 

the remedial work done in an attempt to save the well was $366,000.00, and the 

necessary cost of drilling and equipping a replacement well was $494,112.00. 

Because the market value ($836,000.00) was less than the cost of remediation plus 

the cost of drilling the new well ($366,000.00+494,112.00), the trial court entered 

judgment for $334,400.00, which was 40% of the market value. It did NOT add the 

remediation costs to the market value. On appeal, Houston Fishing argued that it 

should only have to pay 40% of $494,112.00, but the appeals court disagreed,

holding that the trial court correctly considered the remediation costs as part of the 

costs of the replacement well: 

In this case, Page made what the jury considered a reasonable attempt 

to save the well with necessary expenditures of $366,000.00. Page is 

entitled to recover this reasonable and necessary expenditure as part of 

the cost of drilling the replacement well. (citations omitted). Thus, the 

total cost of drilling the replacement well, including the expenditures 

for the remedial work on the original well, was $860,112.00 

($494,112.00 plus $366,000.00). This cost of drilling the replacement 

well exceeds the cash fair market value of the original well prior to the 
8

occurrence in question; therefore, the trial court correctly rendered 

judgment against Houston Fishing for $334,400.00.

Contrary to Appellees’ suggestion then, using the exact approach taken by 

the Dresser court here would have resulted in a judgment of only $5,138,000. The 

jury found that the difference in market value before and after the occurrence was 

$7,562,000, the cost of remediation was $5,138,000 and the necessary cost of 

drilling and equipping a new well was $ 0. Since remediation costs plus redrilling 

costs as found by the jury ($5,138,000 + $ 0) were less than market value 

($7,562,000), $5,138,000 would have been the appropriate amount of the judgment 

based on the jury’s answers. 

Even if the trial court believed Appellees’ post-trial arguments, and found that 

the jury was wrong and should have awarded $5,396,697.121for the cost of drilling 

a new well, the Dresser approach would still have resulted in a judgment of only 

$7,562,000, since the fair market value is less than the cost of remediation plus cost 

of drilling a new well. Nowhere in Dresser is it suggested that the cost of attempted 

remediation should be added to the fair market value in making an award.

 

1 Appellees suggest that the jury must have awarded $0 as the reasonable and necessary costs to 

drill a well to replace the Collins #1 because they believed that the Collins #2 well would have 

been drilled anyway. But the question did not ask about the Collins #2, instead asking the jury to 

determine the amount necessary to redrill and complete an oil and gas well to replace the Collins 

#1 well. Based on the wording of the question, it is more plausible that the jury simply did not 

believe that drilling another well was made necessary by the occurrence.
9

Appellees also cite United States Torpedo Co. v. Liner, a 1927 case, for the 

proposition that expenses to attempt to save the well are recoverable in addition to 

market value. United States Torpedo Co. v. Liner, 300 S.W. 641 (Tex. Civ. App –

Eastland 1927) (reversed on other grounds). While this language is found in dicta, 

the issue of whether such expenses were properly awarded was not challenged on 

appeal. The damage issue appealed there was whether or not the value of lost casing 

was properly deducted from the award. Id. at 646. It is also significant to note that 

in discussing damages awarded, the Liner court pointed out that “no contention was 

made by either party that the damage to the well could have been repaired.” Id. Had 

there been an issue or reparability of the well then, the result would have been 

different.

Likewise, in a footnote, Appellees argue that in Dowell, Inc. v. Cichowski, 

plaintiff was “allowed” to recover $76,706.33, which included $13,706.33 for 

remedial repairs to the abandoned well, and $63,000 for the net cost of drilling and 

equipping a replacement well, even though the market value of the abandoned well 

was only $66,000. Dowell, Inc. v. Cichowski, 540 S.W.2d 342 (Tex. Civ. App. –

San Antonio 1976, no writ) (Appellees’ Brief at p. 52, fn. 134). Again, the judgment 

did not include an award for both market value and cost of remediation, and just as 

in Liner, the inclusion of the remedial repairs in the judgment was not challenged in 

the appeal.
10

Finally, Appellees argue that Basin Oil Co. of Cal. v. Baash-Ross Tool Co., a 

1954 California case not decided under Texas law, and with no precedential value 

here, supports their argument. Basin Oil Co. of Cal. v. Baash-Ross Tool Co., 125 

Cal. App. 2d 578 (1954). In Basin, the issue of whether or not any cost of remedial 

operations should have been included was not challenged. Rather, appellants in that 

case challenged only the amount of the damages included.2

Following current Texas case law and guiding precedent, the trial court’s 

award of damages is in error. The judgment should be reversed, or at a minimum, 

reformed to correct the error.

CONCLUSION AND PRAYER

The judgment in this case should be reversed, or alternatively at a minimum, 

reformed. By entering the judgement it did, the trial court disregarded Texas 

Supreme Court precedent by failing to submit a necessary fact issue to the jury and 

by ignoring the proper measure of damages. 

The only way the judgment in this case can stand is if this Court 1) assumes

that the damages to the well were permanent, despite an unresolved fact question the 

jury was never allowed to answer 2) ignores the jury’s finding that $ 0 was the 

reasonable and necessary cost to “drill and complete an oil and gas well to replace 

 

2

“Baash-Ross’s next point is that the court erred in applying a measure of damages based on the 

cost of remedial operations undertaken 18 months after the failure of the plugs instead of assessing 

damages on the basis of remedial operations promptly instituted.” Basin Oil, 125 Cal. App. 2d 

578 at 600.
11

the Collins #1 and 3) interprets the jury’s finding that $5,138,000 was a reasonable 

amount to “repair and restore” the Collins #1 well, as really meaning that this was a 

reasonable amount to “attempt” to repair the well, but not to fully restore it, 4) 

disregards the very authority that Appellees rely on, which upholds an award of only 

market value, and not market value plus the cost of attempted remediation. 

Appellant, Premium Valve Services, LLC respectfully requests this Court to 

reverse the judgment of the trial court and order a new trial of this matter.

Alternatively, Appellant requests the Court reform the judgment of the trial court, 

and award actual damages of $5,138,000 plus interest and court costs.

Respectfully submitted,

/s H. Dwayne Newton

_____________________________

H. Dwayne Newton

State Bar of Texas No. 14977200

dnewton@newton-lawyers.com

Cynthia L. Jones

State Bar of Texas No. 00852600

cljones@newton-lawyers.com

NEWTON,JONES & SPAETH

3405 Marquart

Houston, TX 77027

Telephone: 713-493-7620

Facsimile: 713-493-7633
12

CERTIFICATE OF SERVICE

I certify that a true and correct copy of this Reply Brief of Appellant was 

served on the following counsel for Appellees via electronic filing on September 17, 

2015.

Julie M. Palmer

State Bar of Texas No. 08710800

jpalmer@grayreed.com

GRAY REED & MCGRAW, PC

1300 Post Oak Blvd., Suite 2000

Houston, TX 77056

/s/ H. Dwayne Newton

_____________________________

CERTIFICATE OF COMPLIANCE

I have relied on the word count provided by my word processing program. 

There are 2705 words in the document.

/s/ H. Dwayne Newton

_____________________________