United States Court of Appeals

for the Fifth Circuit

No. 21-30100

Petro Marine Underwriters, Incorporated; Delta 

Energy Management and Consultants, L.L.C., 

Plaintiffs—Appellees,

versus

Cox Operating, L.L.C.; Cox Oil Offshore, L.L.C., 

Defendants—Appellants.

Appeal from the United States District Court 

for the Eastern District of Louisiana 

USDC No. 2:17-CV-9955

Before Barksdale, Stewart, and Dennis, Circuit Judges.

Per Curiam:*

This breach of contract dispute arises out of an arrangement between 

Plaintiffs-Appellees Petro-Marine Underwriters, Inc. (“Petro”) and Delta 

Energy Management Consultants, LLC (“Delta”) (collectively, 

“Plaintiffs”), and Defendants-Appellants Cox Operating, L.L.C. and Cox 

Oil Offshore, L.L.C. (collectively, “Cox”) for the payment of bond 

* Pursuant to 5th Circuit Rule 47.5, the court has determined that this 

opinion should not be published and is not precedent except under the limited 

circumstances set forth in 5th Circuit Rule 47.5.4.

United States Court of Appeals

Fifth Circuit

FILED

June 2, 2022

Lyle W. Cayce

Clerk

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commissions to Plaintiffs in exchange for consulting services they provided 

to assist Cox with the acquisition of certain assets from Chevron USA, Inc. 

(“Chevron”) and the placement of any related bonding. Cox appeals the final 

judgment in Plaintiffs’ favor. We AFFIRM.

I.Facts & Procedural History

Petro provides surety bond broker services. Delta provides consulting 

services. Cox is engaged in oil and gas exploration and production. Cox 

engaged Plaintiffs to provide consulting services related to assets Cox sought 

to acquire from Chevron.

Before the parties entered into the agreement at issue, Plaintiffs wrote 

reports for and attended meetings on behalf of Cox. Cox discussed options 

for compensating Plaintiffs with its insurance broker, McGriff, Seibels, & 

Williams, Inc. (“McGriff”), and in an email dated September 3, 2015, 

McGriff informed Cox that it would be willing to share commissions with 

Plaintiffs. On September 9, 2015, Cox executed an email agreement with 

Plaintiffs detailing the sharing of commissions between Plaintiffs and 

McGriff, which was subsequently formalized in a letter (“Letter 

Agreement”). The Letter Agreement detailed the commission-sharing 

structure between Plaintiffs and the “Broker or Agent actually acquiring such 

surety on behalf of Cox.” According to the Letter Agreement, Plaintiffs 

would be compensated when surety bonds were placed or renewed due to 

Cox’s acquisition of the Chevron assets. Thus, the Agreement facilitated 

future payment for Plaintiffs’ past and potential future services. Relevant 

here, the Letter Agreement provided the following:

In accordance with our Agreement dated September 9, 2015 

between [Cox and Plaintiffs], the parties have further agreed to 

the following. Delta and Petro have already provided, and may 

continue to provide, certain consulting services to Cox with 

regard to the acquisition of Chevron assets and on regulatory 

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issues regarding financial assurances to the federal government 

and oil and gas companies.

Compensation due Delta and/or Petro for these services shall 

be due and payable on the initial placement and any subsequent 

renewals of any surety bonding placed on behalf of any Cox 

entity which resulted from the acquisition by Cox of interests 

in certain assets of Chevron in the Gulf of Mexico in Chevron’s 

2015 offering, regardless of the brokers or agents involved, for 

as long as Cox owns any interest in those assets. This 

compensation is due at the initial placement of any such surety 

whenever that individual event occurs, it being recognized that 

the assets may likely be bonded over a period of time. . . .

Regarding all surety renewals, the split for all compensation 

received . . . will be reversed with 65% of all compensation, 

service fees or gross income received from renewals going to 

the placing Broker or Agency (or to their interest) and the 

remaining 35% paid to Petro. . . .

It is further agreed that [Petro] will be made co-broker on all 

bonds placed on properties purchased from Chevron and is 

entitled to the above referenced commission structure as long 

as a Cox related entity has an [sic] any interest in these 

properties. 

In the fall of 2015, oil prices dropped, banks refused to provide Cox 

with financing for the transaction, and Cox’s status as the exclusive potential 

purchaser of the Chevron assets was set to expire on October 30, 2015. On 

October 28, 2015, Cox notified Plaintiffs of the deal’s uncertainty and 

advised Plaintiffs to either invoice Cox for the work they had performed or 

“just let things go.”

On December 9, 2015, Cox, Chevron, and Union Oil Company of 

California (“Union Oil”) entered into an Asset Sale and Purchase 

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Agreement (“ASPA”) that transferred assets to Cox. The ASPA required

Cox to place a $48 million Performance Bond1to provide security from Cox 

to Chevron and Union Oil. Due to the regulation of all offshore operators 

with the U.S. Department of Interior Bureau of Ocean Energy Management

(“BOEM”),

2 Cox placed two additional bonds: a $3 million Area-Wide 

operator’s bond3 and a $300,000 Right-of-Way bond4 as security for Cox to 

BOEM. Cox acquired all three bonds through Aspen American Insurance 

Company (“Aspen”), a bond surety company. The deal closed on April 15, 

2016, and each of the bonds was issued the same day. McGriff was made the 

sole broker on each of the bonds.

In July 2017, after learning of the bond placements, Plaintiffs sent a 

letter to Cox demanding commissions from the bond placements. On August 

23, 2017, Cox responded with a letter denying an obligation to pay Plaintiffs 

and giving notice to terminate the Letter Agreement.

On October 2, 2017, Plaintiffs filed the instant suit claiming breach of 

contract. Cox filed a motion for summary judgment, and Plaintiffs filed a 

motion for partial summary judgment. The district court denied Cox’s 

motion for summary judgment and granted Plaintiffs’ motion for partial 

summary judgment as to Cox’s liability but denied Plaintiffs’ motion as to 

whether Cox acted in bad faith.

Plaintiffs subsequently filed another motion for partial summary 

judgment seeking past due damages, namely, their share of the bond 

commissions paid up to and through April 15, 2020. The district court 

1 Bond No. SU13887.

2 See 30 C.F.R. § 556.900(a)(3) (2016); 30 C.F.R. § 556.901(a)(2)(ii), (b)(2); 30 

C.F.R. § 550.1011(a)(1).

3 Bond No. SU13888.

4 Bond No. SU13889.

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granted this motion on January 5, 2021, and entered final judgment on both 

partial summary judgment orders on January 21, 2021. This appeal followed.

II.Standard of Review

“We review a district court’s grant of summary judgment de novo, 

applying the same standards as the district court.” Hagen v. Aetna Ins. Co., 

808 F.3d 1022, 1026 (5th Cir. 2015). Summary judgment is appropriate if the 

record evidence “shows that there is no genuine dispute as to any material 

fact and the movant is entitled to judgment as a matter of law.” Fed. R. 

Civ. P. 56(a). Our de novo review includes, of course, “the district court’s 

interpretation of the contract, including the question of whether the contract 

is ambiguous.” Greenwood 950, L.L.C. v. Chesapeake La., L.P., 683 F.3d 666, 

668 (5th Cir. 2012). 

III.Discussion

On appeal, Cox argues that the district court erred by holding that: (1) 

“the procuring cause doctrine did not apply to the Letter Agreement,” (2) 

“the Letter Agreement obligated Cox to name Petro as a co-broker,” (3) “the 

Letter Agreement should not be rescinded due to Cox’s error,” (4) the Letter 

Agreement was not properly terminated, and (5) “the Area-Wide and Rightof-Way Bonds were subject to the Letter Agreement.” We address each of 

Cox’s assignments of error in turn. This is a diversity action, for which 

Louisiana state law applies.

1. Procuring cause doctrine

The district court held that the Letter Agreement was not subject to 

the hereinafter described procuring cause doctrine because it was not a 

broker agreement. We agree.

Under Louisiana law, a broker “must prove he was the procuring 

cause in bringing the parties together on common terms, to be entitled to the 

agreed commissions” where there was not an exclusive contract. McLeod v. 

L. & L. Oil Co., 147 So. 2d 241, 243 (La. Ct. App. 1962). Black’s Law 

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Dictionary defines a “brokerage contract” as “an agency agreement 

employing a broker to make contracts in the name of and on behalf of the 

principal and for which the broker receives a commission.” Brokerage 

contract, Black’s Law Dictionary (9th ed. 2009).

Pointing out that the compensation scheme detailed in the Letter 

Agreement differentiates between Petro and “the placing Broker or Agency” 

and specifies that compensation shall be due “regardless of the brokers or 

agents involved,” the district court reasoned that the parties intended for 

Plaintiffs to be compensated regardless of whether they were the placing 

broker or agency on the Cox-Chevron transaction. Consequently, it held that 

the Letter Agreement was not a broker agreement and thus was not subject 

to the procuring cause doctrine. 

On appeal, Cox does not contend that the Letter Agreement was a 

broker agreement. Rather, it asserts that Plaintiffs bore “the burden to prove 

they were the procuring cause in placing the [b]onds” and that “Plaintiffs 

never placed any bonds for any properties [Cox acquired].” But, by the plain 

language of the Letter Agreement, Plaintiffs’ compensation was not 

contingent upon their placement of any bonds for Cox.

Cox directs the court’s attention to Gulf Marine Equipment, Inc. v. C 

& G Boat Works, Inc., 471 F. Supp. 2d 679 (E.D. La.), aff’d, 242 F. App’x 207 

(5th Cir. 2007) to support its position that application of the procuring cause 

doctrine does not depend on the existence of a broker agreement. There, the 

district court held that “it is without question that if Plaintiff were the 

procuring cause of the C & G—Rigdon Marine contracts, the termination of 

the brokerage agreement would not prevent Plaintiff from recovering 

brokerage fees.” Id. at 682. But Gulf Marine is inapposite here for two 

reasons. First, unlike here, the district court in that case characterized the 

agreement as a brokerage agreement. Id. Second, the case concerned whether 

the plaintiffs were the procuring cause of contracts the principal entered into 

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after it terminated its broker agreement with plaintiffs, not whether the 

procuring cause doctrine applies where a broker agreement never existed. See 

id. at 681–83.

Accordingly, because the Letter Agreement was a contract providing 

the payment mechanism for Plaintiffs’ past and potential future services 

rather than a broker agreement, we hold that the procuring cause doctrine 

does not apply.

2. Cox’s obligation to name Petro as a co-broker

Cox argues that “the [d]istrict [c]ourt erred when it held that the 

Letter Agreement obligated Cox to name Petro as a co-broker.” It asserts that 

an equally reasonable interpretation of the Letter Agreement is that it was 

Plaintiffs’ obligation to affirmatively request Cox to name them as cobrokers. Plaintiffs counter that Cox was “the sole entity with the power to 

name [Petro] as co-broker” and that the Letter Agreement called for Cox to 

do so. We agree.

The Letter Agreement states that “[Petro] will be made co-broker on 

all bonds placed on properties purchased from Chevron.” Under Louisiana 

law, “[w]hen the words of the contract are clear and explicit and lead to no 

absurd consequences, no further interpretation may be made in search of the 

parties’ intent.” La. Civ. Code Ann. art. 2046. “In addition, a contract 

provision is not ambiguous where only one of two competing interpretations 

is reasonable or merely because one party can create a dispute in hindsight.” 

Tex. E. Transmission Corp. v. Amerada Hess Corp., 145 F.3d 737, 741 (5th Cir. 

1998). 

Cox avers that the Letter Agreement provision is ambiguous because 

it is written in passive voice and thus does not indicate who is responsible for 

making Petro a co-broker and when. We are not persuaded by this argument. 

The district court correctly concluded that this provision is unambiguous 

because Plaintiffs offer the only reasonable interpretation.

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Because Cox was the only entity with the power to name Petro as a cobroker, we hold that Cox was automatically obligated to do so.

3. Rescission of the Letter Agreement

Cox contends that the district court erred by holding that the Letter 

Agreement should not be rescinded due to Cox’s error. Plaintiffs counter that 

Cox’s argument fails because its assertion of error does not go to the cause of 

the contract. We agree.

Louisiana Civil Code Article 1948 provides that a party’s “[c]onsent 

may be vitiated by error, fraud, or duress.” La. Civ. Code Ann. art. 1948. 

“If error vitiates a party’s consent, the contract may be rescinded.” Chalos 

& Co., P.C. v. Marine Managers, Ltd., No. Civ.A. 14-2441, 2015 WL 6442558, 

at *7 (E.D. La. Oct. 23, 2015) (citing Cyprien v. Bd. of Supervisors ex rel. Univ. 

of La., 5 So. 3d 862, 868 (La. 2009)). “Error vitiates consent only when it 

concerns a cause without which the obligation would not have been incurred 

and that cause was known or should have been known to the other party.” 

La. Civ. Code Ann. art. 1949. “Cause is the reason why a party obligates 

himself.” La. Civ. Code Ann. art. 1967

Here, the reason why Cox obligated itself was to establish a scheme by 

which Plaintiffs would be compensated in the future for the consulting 

services they “ha[d] already provided, and may continue to provide.” Cox 

argues that the Letter Agreement should be rescinded because the 

uncertainty as to who was obligated to make Petro a co-broker of the bonds,

and when (if at all) they were obligated, “sounds in error.” But as explained 

above, the Letter Agreement is not ambiguous, so there was no uncertainty 

as to who was obligated to make Petro a co-broker. Further, Cox has not 

asserted an error concerning a cause of the contract. Thus, no error vitiates 

its consent to the Letter Agreement.

Accordingly, the district court properly held that Cox’s defenses of 

error were unfounded.

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4. Termination of the Letter Agreement

Cox asserts that the district court erred when it held that Cox 

improperly terminated the Letter Agreement. Cox posits that the Letter 

Agreement is a contract of unspecified duration because it was predicated on 

a factor that cannot be calculated, assured, or known: Cox maintaining 

ownership in the Chevron assets. As a result, Cox argues that the Letter 

Agreement could be terminated at the will of either party under Louisiana 

Civil Code Article 2024 and that its termination was proper and effective.

Plaintiffs counter that the phrase, “as long as Cox owns any interest in those 

assets” is an uncertain but determinable term, and that the Letter Agreement 

was subject to termination upon the occurrence of a certain and definite 

resolutory condition5 or event: “Cox[] divesting of the interests it acquired 

in the . . . Chevron assets.” We agree with Plaintiffs.

Under Louisiana law, “[a] contract of unspecified duration may be 

terminated at the will of either party by giving notice, reasonable in time and 

form, to the other party.” La. Civ. Code Ann. art. 2024. Moreover, 

“[b]ecause duration refers to the term of the contract, Article 2024 should 

be read in pari materia with provisions regarding the term of obligations.”

Caddo Gas Gathering L.L.C. v. Regency Intrastate Gas LLC, 26 So. 3d 233, 236 

(La. Ct. App. 2009). Louisiana Civil Code Article 1778 provides:

A term for the performance of an obligation is a period of time 

either certain or uncertain. It is certain when it is fixed. It is 

uncertain when it is not fixed but is determinable either by the 

intent of the parties or by the occurrence of a future and certain 

event. It is also uncertain when it is not determinable, in which 

case the obligation must be performed within a reasonable 

time.

5 “A conditional obligation is one dependent on an uncertain event.” La. Civ. 

Code Ann. art. 1767. “If the obligation may be immediately enforced but will come to an 

end when the uncertain event occurs, the condition is resolutory.” Id.

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La. Civ. Code Ann. art. 1778.

We observe no error in the district court’s reasoning that the Letter 

Agreement is subject to a clearly determinable resolutory condition based on 

the following language: “for as long as Cox owns any interest in those assets” 

and “as long as a Cox related entity has an [sic] any interest in these 

properties.” Those phrases demonstrate that the Letter Agreement would 

terminate once Cox no longer owned any interest in the Chevron assets—an 

uncertain term that is determinable by the occurrence of a future event. In 

other words, the Letter Agreement was not the type of contract that could be 

“terminated at the will of either party.”

Accordingly, the district court correctly concluded that Cox did not 

properly terminate the Letter Agreement pursuant to Article 2024.

Cox further contends that the Letter Agreement lapsed because it 

contemplated a suspensive condition6that was never fulfilled: Cox securing 

the Chevron assets by October 30, 2015. Cox waived this argument by failing 

to raise it before the district court. See Rollins v. Home Depot USA, 8 F.4th 

393, 397 (5th Cir. 2021) (“A party forfeits an argument by failing to raise it in 

the first instance in the district court—thus raising it for the first time on 

appeal—or by failing to adequately brief the argument on appeal.”). But 

assuming arguendo that Cox did not waive this argument, it is still unfounded 

because the October 30, 2015, condition is neither expressed nor implied by 

the Letter Agreement. We thus reject Cox’s argument that it was relieved of 

its obligation to name Petro as a co-broker by virtue of the fact that it acquired 

the Chevron assets after October 30, 2015.

5. Area-Wide and Right-of-Way Bonds

6 “If the obligation may not be enforced until the uncertain event occurs, the 

condition is suspensive.” Id.

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Finally, Cox argues that the district court erred in holding that the 

Area-Wide and Right-of-Way Bonds were subject to the Letter Agreement.

Cox and Plaintiffs rely on two different provisions in the Letter 

Agreement to advance their arguments. In the district court, Cox relied on 

the same paragraph as Plaintiffs, arguing in its opposition to Plaintiffs’ 

motion for partial summary judgment that the Area-Wide and Right-of-Way 

bonds were not “related to the Chevron assets.” But on appeal, Cox invites

this court to look to the fourth paragraph, which reads in relevant part: “It is 

further agreed that [Petro] will be made co-broker on all bonds placed on 

properties purchased from Chevron . . . .” Because the Area-Wide and Rightof-Way Bonds were placed as security to BOEM so that Cox could operate in 

the Gulf of Mexico, Cox reasons that “the Area-Wide and Right-of-Way 

Bonds were not ‘placed on properties purchased from Chevron’ within the 

meaning of the Letter Agreement” and should thus “be excluded from the 

calculation of commissions owed to the Plaintiffs.” Because Cox did not raise 

this argument before the district court, it is waived, and we decline its 

invitation to consider it now. See Rollins, 8 F.4th at 398 (“We do not 

ordinarily consider issues that are forfeited because they are raised for the 

first time on appeal.”). 

Plaintiffs rely on the second paragraph, which begins: 

Compensation due Delta and/or Petro for these services shall 

be due and payable on the initial placement and any subsequent 

renewals of any surety bonding placed on behalf of any Cox 

entity which resulted from the acquisition by Cox of interests 

in certain assets of Chevron in the Gulf of Mexico . . . .

Plaintiffs counter that because the placement of the Area-Wide and 

Right-of-Way Bonds resulted from Cox’s acquisition of the Chevron assets, 

the Letter Agreement contemplates no exception for those bonds and 

Plaintiffs are entitled to those commissions. We agree with Plaintiffs.

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Relevant here, the cover page of the BOEM form for the Area-Wide 

Bond states: “BOEM collects this information to hold the surety liable for 

the obligations and liability of the Principal (lessee or operator).” Both the 

Area-Wide Bond and the Right-of-Way Bonds identify Aspen as the surety, 

Cox as the principal, and the Gulf of Mexico as the region covered by the 

bond. Both bonds bind Aspen to BOEM. The parties stipulated that prior to 

Cox’s acquisition of the Chevron assets, Cox had neither the Area-Wide nor 

the Right-of-Way Bond filed with BOEM. It posted those bonds for the first 

time upon taking ownership of the Chevron assets. Accordingly, the Bonds, 

while required by the federal government, quite literally “resulted from the 

acquisition by Cox of interests in certain assets of Chevron in the Gulf of 

Mexico.”

We hold that the district court did not err in concluding that the AreaWide and Right-of-Way Bonds fell within the scope of the Letter Agreement.

IV.Conclusion

For the foregoing reasons, the district court’s judgment is 

AFFIRMED.

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