Court Opinion

ID: 9914576
Source: CourtListenerOpinion
Date Created: 2024-01-02 16:08:28.613332+00
Date Added: 2024-06-11T13:13:47.374381
License: Public Domain

Fourth Court of Appeals
                                       San Antonio, Texas

                                    CONCURRING OPINION
                                          No. 04-18-00411-CV

REPSOL OIL AND GAS USA, LLC as successor of Talisman Energy USA Inc, Statoil Texas
        Onshore Properties, LLC, and Statoil Pipelines, LLC, and OGE, LLC,
                                    Appellants

                                                     v.

 MATRIX PETROLEUM, LLC, Matrix Petroleum Holdings LLC, JAR Resources Holdings,
                    L.P., and TMRX Petroleum, LLC,
                               Appellees

                     From the 218th Judicial District Court, La Salle County, Texas
                                  Trial Court No. 14-08-00158-CVL
                              Honorable Russell Wilson, Judge Presiding

Opinion by: Rebeca C. Martinez, Chief Justice
Concurring Opinion by: Beth Watkins, Justice

Sitting:          Rebeca C. Martinez, Chief Justice
                  Luz Elena D. Chapa, Justice
                  Beth Watkins, Justice

Delivered and Filed: December 27, 2023

           I do not reach the decision to reverse a jury verdict lightly. Cf. Hardberger, Phil D., Juries

Under Siege, 30 ST. MARY’S L.J. 1, 8–9 (1998). Here, however, I must because I cannot escape

the conclusion that Talisman lacked fair notice of the missing volume of production claims on

which the jury awarded Matrix and OGE nearly $79,000,000. I join the court’s opinion and write

separately to emphasize my reasons.
Concurring Opinion                                                                     04-18-00411-CV

        Matrix and OGE presented several separate and distinct theories of recovery at trial. One

theory concerned how the working interest owners’ shares of production should have been

measured and allocated at the CDP. Talisman used a volumetric allocation methodology; Matrix

and OGE argued a flash allocation methodology was required. There is no question that Matrix

and OGE provided fair notice of this “methodology” claim in their pleadings. To support its

methodology claim, Matrix relied on the report of its expert, David Reeves, and OGE relied on

that evidence as well. In the report Matrix provided before Reeves’s second deposition, Reeves

concluded that Talisman owed the Matrix parties $663,626 on this methodology claim. In that

deposition, Reeves affirmed that “there are no other claims” in addition to Matrix’s claim for

$663,626.

        At trial, however, Matrix raised—and OGE parroted—a separate claim that had nothing to

do with the dispute about whether a volumetric allocation methodology or a flash allocation

methodology was more appropriate. Instead, in this distinct “missing volumes of production”

claim, Matrix compared the volumes of production Talisman reported to the Texas Railroad

Commission to the volumes of production Talisman reported to the working interest owners, and

concluded that the difference, after appropriate deductions, was $67,591,369 for Matrix and

$11,265,228 for OGE. The record establishes that Matrix and OGE developed this theory after

Reeves’s second—and final—deposition. As the court’s opinion describes, after that deposition,

neither Matrix nor OGE amended their pleadings in any meaningful way.

        I have scoured Matrix’s and OGE’s live pleadings and, because no special exceptions were

filed, construed them liberally in favor of the pleader, as the fair notice pleadings standard requires

me to do. See The Huff Energy Fund, L.P. v. Longview Energy Co., 482 S.W.3d 184, 195 (Tex.

App.—San Antonio 2015) (en banc), aff’d, 533 S.W.3d 866 (Tex. 2017); Roark v. Allen, 633

S.W.2d 804, 809 (Tex. 1982). I have endeavored to reasonably infer a cause of action from the

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Concurring Opinion                                                               04-18-00411-CV

allegations Matrix and OGE specifically stated. See Huff Energy, 482 S.W.3d at 195. And I am

left with no choice but to conclude that an opposing attorney of reasonable competence could not

have ascertained the nature of Matrix and OGE’s missing volumes of production claim from these

pleadings. Even with the benefit of time to scour the pleadings and lengthy record, I simply

cannot—from pleadings that asserted a $663,626 methodology claim—find support for missing

volumes of production claims of nearly $79,000,000.

        For those reasons, I join the court’s conclusion that the judgment awarding damages on

Matrix and OGE’s missing volumes of production claims must be reversed.

                                                Beth Watkins, Justice

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