Court Opinion

ID: 4766451
Source: CourtListenerOpinion
Date Created: 2021-08-17 20:07:23.918098+00
Date Added: 2024-06-11T08:09:17.776035
License: Public Domain

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

FLORIDA CHEMICAL COMPANY, LLC,                )
and ARCHER-DANIELS-MIDLAND                    )
COMPANY,                                      )
                                              )
               Plaintiffs,                    )
                                              )
        v.                                    )   C.A. No. 2021-0288-JTL
                                              )
FLOTEK INDUSTRIES, INC., and                  )
FLOTEK CHEMISTRY, LLC                         )
                                              )
               Defendants.                    )

                                      OPINION

                             Date Submitted: July 21, 2021
                             Date Decided: August 17, 2021

Kevin R. Shannon, Christopher N. Kelly, Daniel M. Rusk, IV, POTTER ANDERSON &
CORROON LLP, Wilmington, Delaware; William C. O’Neil, Joanna R. Travalini, Adam
J. Smith, WINSTON & STRAWN LLP, Chicago, Illinois; Counsel for Plaintiffs.

A. Thompson Bayliss, J. Peter Shindel, Adam K. Schulman, ABRAMS & BAYLISS LLP,
Wilmington, Delaware; Layne E. Kruse, Joy Soloway, Kelly Potter, NORTON ROSE
FULBRIGHT US LLP, Houston, Texas; Counsel for Defendants.

LASTER, V.C.
       Under a stock purchase agreement, a buyer contracted with a parent corporation to

acquire a wholly owned subsidiary (the “Company”). In accordance with the stock

purchase agreement, the seller caused the Company to enter into a supply agreement with

another of the seller’s wholly owned subsidiaries. The stock purchase agreement attached

a form of the supply agreement as an exhibit and required that the seller furnish an executed

copy of the supply agreement at closing. The supply agreement ensured that after the sale,

there would be an ongoing contractual relationship between the Company as supplier

(owned after the sale by the buyer) and the seller’s wholly owned subsidiary as customer

(still owned after the sale by the seller).

       The stock purchase agreement contained a forum selection provision that

encompassed all claims arising out of or relating to the stock purchase agreement and

related transaction documents, including the supply agreement. The provision requires that

those claims be litigated in a court located in the State of Delaware. The supply agreement

did not contain a forum selection provision.

       The seller signed the stock purchase agreement that contains the forum selection

provision. The seller did not sign the supply agreement. The seller’s subsidiary signed the

supply agreement. The seller’s subsidiary did not sign the stock purchase agreement.

       When disputes arose over the supply agreement, the seller and its subsidiary filed a

lawsuit in Texas state court. They asserted a range of claims against the buyer and the

Company, including causes of action for breach of the supply agreement and for tortious

interference with the supply agreement. As a remedy, they sought rescission of the supply

agreement.
       The buyer and the Company responded by filing this action. At this stage of the

case, they seek an anti-suit injunction barring the seller and its subsidiary from pursuing

their claims in the Texas lawsuit. The plaintiffs ask the court to apply the forum selection

provision in the stock purchase agreement to the claims implicating the supply agreement.

They also ask the court to enforce the provision not only against the seller that signed the

stock purchase agreement, but also against its non-signatory subsidiary.

       This decision grants the request for an anti-suit injunction against the seller. The

analysis is straightforward. The plain language of the forum selection provision

encompasses claims that arise out of or relate to the supply agreement. The seller chose to

bind itself to that provision, and the court will enforce the seller’s commitment.

       This decision also grants the request for an anti-suit injunction against the non-

signatory subsidiary. The analysis is more complex.

       In a line of decisions traceable to Capital Group Cos., Inc. v. Armour, 2004 WL

2521295 (Del. Ch. Nov. 3, 2004), Delaware courts have held that a forum selection

provision can be enforced against a non-signatory under principles of estoppel.

       Equitable estoppel supports enforcement of a forum selection provision against a

non-signatory if the non-signatory accepted a direct benefit under the agreement. The

doctrine of equitable estoppel prevents the non-signatory from accepting the benefits of the

agreement without also accepting its burdens, including the forum selection provision.

       Promissory estoppel supports enforcement of a forum selection provision against a

non-signatory if a signatory to the agreement controls the non-signatory, and if the

circumstances surrounding the transaction evidence a promise by the signatory to litigate

                                             2
in a particular forum on behalf of itself and its non-signatory affiliate. The doctrine of

promissory estoppel bars the signatory controller from promising to concentrate all

litigation that falls within the provision in a single forum, then using the non-signatory

affiliate to evade that promise.

       So far, so good. But in elliptical language, the Capital Group decision examined

whether the claims against the non-signatory arose from the non-signatory’s “standing

relating to” the agreement containing the forum selection provision. In the section of the

decision that contains that language, the court seems merely to have evaluated whether the

claims at issue fell within the forum selection provision in the pertinent agreement.

Subsequent cases, however, have interpreted that step in the court’s reasoning as

establishing an additional element that must be met before a forum selection provision can

bind a non-signatory. Under that line of cases, the agreement that contains the forum

selection provision must give rise to the claim by or against the non-signatory. This

decision refers to that interpretation as the “same-agreement rule.”

       The same-agreement rule first appeared in dictum. The decision that expressed the

dictum did not have to reach that element of the Capital Group test, because the parties

stipulated that it was met. Moreover, the facts of the case likely would not have supported

a strict application of the same-agreement rule. And despite articulating the same-

agreement rule, the court framed its analysis broadly and relied on explicitly policy-based

reasoning, suggesting that the court still would have enforced the forum selection provision

against the non-signatory even without the parties’ stipulation. The same-agreement rule

thus rests on a questionable foundation.

                                             3
       A more serious problem is that the same-agreement rule limits the scope of the

forum selection provision that otherwise binds the non-signatory. If a forum selection

provision sweeps more broadly than claims arising under the agreement containing the

provision (as forum selection provisions often do), then the same-agreement rule

overwrites the provision to reach only those claims arising under the agreement containing

the provision. That result conflicts with both estoppel-based paths to enforcement. When

equitable estoppel provides the basis for enforcing the provision against the non-signatory,

the same-agreement rule enables the non-signatory to accept the benefits of the agreement

while only being bound by a subset of the burdens. When promissory estoppel provides

the basis for enforcing the provision against the non-signatory, the same-agreement rule

enables the controller to promise that it will litigate in a particular jurisdiction to the full

extent of the forum selection provision, then evade its promise for any claim that does not

satisfy the same-agreement rule.

       This decision therefore declines to apply the same-agreement rule. After

determining that the other elements of the Capital Group test are met, it asks only whether

the claims at issue fall within the scope of the forum selection provision.

       In this case, the seller promised under the plain language of the forum selection

provision in the stock purchase agreement to litigate all claims arising out of or relating to

the supply agreement in Delaware. The seller entered into the supply agreement through a

controlled affiliate. For the seller’s commitment to be meaningful, the seller’s promise had

to encompass claims by or against the non-signatory affiliate that arise out of or relate to

                                               4
the supply agreement. The forum selection provision therefore binds the non-signatory

affiliate.

        Applying the same-agreement rule would conflict with the plain language of the

forum selection provision and enable the seller to evade its promise. And the resulting

jurisdictional scheme is not one that parties logically would craft. The provision would

bind the seller to sue the buyer in Delaware for tortious interference with the supply

agreement (because the seller signed the stock purchase agreement and is bound to the full

extent of the provision). Yet the provision would not require the subsidiary that is a party

to the supply agreement to sue in Delaware for breach of the supply agreement or to seek

rescission of the agreement (because the same-agreement rule would limit the scope of the

provision for the subsidiary to claims arising under the stock purchase agreement). Instead

of fulfilling the seller’s promise to centralize litigation in a single forum, the forum

selection provision would promote the balkanization of litigation.

        The parties agree that the forum selection provision is valid and enforceable. This

decision holds that it can be enforced against the seller’s wholly owned subsidiary under

principles of estoppel. Having reached those predicate holdings, this decision enforces the

plain language of the forum selection provision, resulting in the issuance of an anti-suit

injunction against the controlled affiliate that tracks the injunction against its parent.

                          I.       FACTUAL BACKGROUND

        The facts come from the pleadings and the parties’ submissions in connection with

the plaintiffs’ motion for an anti-suit injunction. What follows are not formal factual

                                               5
findings, but rather the facts that appear reasonably likely to be found after trial, based on

the current record.

A.     ADM Purchases The Company.

       Plaintiff Florida Chemical Company, LLC is a Delaware limited liability company

that manufactures citrus products for use in the flavor and fragrance market, including

citrus oils, terpene, citrus flavors, and isolates. In the parlance of this decision, it is the

“Company.” Under a Share Purchase Agreement dated as of January 10, 2019, plaintiff

Archer-Daniels-Midland Company (“ADM”) agreed to acquire all of the outstanding

membership interests in the Company. See Dkt. 1 Ex. A (the “Purchase Agreement” or

“SPA”).

       The seller under the Purchase Agreement was defendant Flotek Industries, Inc.

(“Flotek Parent”). The Purchase Agreement contemplated that between signing and

closing, Flotek Parent would cause the Company to enter into a supply agreement with

another wholly owned subsidiary of Flotek Parent, defendant Flotek Chemistry, LLC

(“Flotek Sub”). Under the supply agreement, the Company agreed to sell to Flotek Sub—

and Flotek Sub agreed to purchase—a minimum quantity of terpene each year. Id. Ex. B

(the “Terpene Agreement,” the “Terpene Supply Agreement,” or the “TSA”).

       Two provisions in the Purchase Agreement memorialized Flotek Parent’s obligation

to cause the Company and Flotek Sub to enter into the Terpene Agreement. The Purchase

Agreement contained a covenant which provided that “[a]t the Closing, the Company will

enter into . . . a supply agreement with Flotek [Sub],” which the Purchase Agreement

defined as the “Terpene Supply Agreement.” SPA § 5.14. The Purchase Agreement also

                                              6
identified the closing deliverables that Flotek Parent had to furnish to ADM, which

included a “counterpart[] of the Terpene Supply Agreement . . . duly executed by Flotek

[Sub] and the Company.” Id. § 1.6(b)(viii). The Purchase Agreement conditioned ADM’s

obligation to close on compliance with those covenants. Id. § 6.2(b). Put differently, ADM

did not have to close if Flotek Parent did not first cause the Company and Flotek Sub to

enter into the Terpene Agreement and then deliver an executed copy of the Terpene

Agreement at closing.

       The Terpene Agreement was a take-or-pay contract, meaning that Flotek Sub was

required to pay for the annual minimum amount of terpene whether it needed the terpene

or not. The Terpene Agreement used a cost-plus pricing mechanism under which Flotek

Sub was obligated to pay the Company for the cost of the Company’s raw materials plus

$0.45 per pound of terpene. TSA § 1. The Terpene Agreement obligated the Company to,

“[w]ithin fifteen (15) days of the end of each calendar quarter[,] . . . provide to Flotek [Sub]

a written report providing reasonable detail regarding the cost” of the terpene it sold to

Flotek Sub. Id. § 5(b). The Terpene Agreement gave Flotek Sub the right to inspect the

Company’s terpene production facility “at any time,” and to “audit the books and records”

of the Company. Id. § 8.

       The Purchase Agreement attached an unsigned and substantially final version of the

Terpene Agreement as an exhibit. Between the signing of the Purchase Agreement and the

closing of the transaction, Flotek Parent caused Flotek Sub and the Company to execute

the Terpene Agreement. The same executive signed the Terpene Agreement for both

entities. See Dkt. 7, Ex. B at 8. The executed Terpene Agreement was substantively

                                               7
identical to the version attached to the Purchase Agreement; the only change inserted the

parties’ addresses in the notice provision. See Dkt. 25 Ex. E.

       Flotek Sub was a party to the Terpene Agreement; Flotek Parent was not.

Conversely, Flotek Sub was not a party to the Purchase Agreement; Flotek Parent was.

       The Purchase Agreement contained a forum selection provision which made courts

located in the State of Delaware the exclusive forum for any dispute arising out of or

relating to the Purchase Agreement and other related agreements, including the Terpene

Agreement. SPA § 9.8 (the “Delaware Forum Provision”). The Terpene Agreement did not

contain a forum selection provision.

       The parties completed the sale of the Company on February 28, 2019 (the

“Transaction”). At closing, Flotek Parent delivered an executed copy of the Terpene

Agreement. After closing, the Company continued as a wholly owned subsidiary of ADM.

Flotek Sub remained a wholly owned subsidiary of Flotek Parent.

B.     The Parties Renegotiate The Terpene Agreement.

       In February 2020, Flotek Parent informed the Company that Flotek Sub no longer

would purchase the minimum amount of terpene specified in the Terpene Agreement.

Flotek Parent cited a downturn in the oil and gas end market as the basis for its decision.

       To resolve the resulting dispute, the parties negotiated an amendment to the Terpene

Agreement. Dkt. 18 Ex. 1-D (the “Amended Terpene Agreement”). The amendment

reduced Flotek Sub’s annual minimum purchase requirements. Id. § 1(a). The amendment

also replaced the cost-plus methodology with a fixed price of $1.50 per pound. Id. In

exchange for those concessions, Flotek Sub agreed to make a one-time payment of $15.75

                                             8
million to the Company. Id. § 2. Flotek Sub also agreed to “order Terpene Product on a

monthly basis, at the same or similar volume every month, to ensure that the Minimum

Quantity is met and evenly distributed in every Year of the Term.” Id. § 1(c). The Amended

Terpene Agreement stated that “[e]xcept as provided herein, all other terms and conditions

of the Agreement remain unchanged and in full force and effect.” Id. § 4.

C.     The Texas Lawsuit

       In late 2020, Flotek Parent informed the Company that Flotek Sub no longer would

honor its purchase obligations under the Amended Terpene Agreement. On February 2,

2021, the Company sent Flotek Sub a written notice of material breach and demanded that

Flotek Sub cure within thirty days. Flotek Sub ignored the demand.

       On March 26, 2021, Flotek Parent and Flotek Sub filed a lawsuit in the District

Court of Harris County, Texas. Dkt. 1 Ex. E (the “Texas Lawsuit”). They named as

defendants the Company, ADM, and Joshua Snively, the President of the Company. Before

the Transaction, Snively was a senior executive of Flotek Parent who oversaw the

Company’s operations. Snively was the lead negotiator for the Terpene Agreement.

       The petition in the Texas Lawsuit focused on Snively’s alleged wrongdoing during

the negotiation of the Terpene Agreement. The petition alleged that Snively gave ADM a

“one-sided deal” because ADM was “dangling a high-paying new job offer in front of

Snively.” Id. ¶ 20. The petition alleged that by providing favorable terms to ADM, Snively

was able “to go over to ADM, his new employer, with a massive contract in hand for the

business he was going to run.” Id. ¶ 30.

                                            9
       The petition also alleged that Snively deceived his superiors. Snively allegedly

represented that the minimum purchase requirement was reasonable, when in reality

“Flotek’s internal projections . . . projected far less use of terpene even under aggressive

assumptions.” Id. ¶ 27. Snively also allegedly represented that the Company’s “oilfield-

related products would remain with Flotek, such that ADM would not be permitted to sell

terpene for oilfield solvent applications.” Id. ¶ 28. Instead, Snively “gave that market away

to ADM.” Id. ¶ 29.

       The petition further asserted that the Company had not complied with the Terpene

Agreement. It alleged that the Company failed to provide quarterly written reports

documenting the cost of the terpene that the Company sold to Flotek Sub. And it alleged

that ADM and the Company “refused to allow Flotek to exercise its inspection and audit

rights, despite repeated demands by Flotek for an inspection or audit.” Id. ¶ 22.

       The petition in the Texas Lawsuit asserted nine causes of action. The causes of

action do not differentiate between Flotek Parent and Flotek Sub.

•      The first cause of action asserted that Snively breached his fiduciary duties to
       “Flotek” by advising “Flotek’s” board of directors to enter into the Terpene
       Agreement “for a minimum quantity of terpene Snively knew Flotek could not use.”
       Id. ¶¶ 40–43; see id. ¶¶ 24, 26–28.

•      The second cause of action asserted that Snively breached the provision in his
       employment agreement that obligated him to “devote his reasonable best efforts and
       his full business time and attention” to promote the business of “Flotek.” Id. ¶¶ 44–
       50 (internal quotation marks omitted).

•      The third cause of action asserted that ADM tortiously interfered with Snively’s
       employment agreement by offering him employment at the Company after the
       Transaction in exchange for Snively negotiating the “one-sided” Terpene
       Agreement. Id. ¶¶ 51–59.

                                             10
•      The fourth cause of action asserted that ADM aided and abetted Snively’s breaches
       of his fiduciary duties. Id. ¶¶ 60–64.

•      The fifth cause of action asserted that ADM and the Company breached the Terpene
       Agreement by failing to permit “Flotek” to inspect the Company’s terpene facility
       and audit its books and records. Id. ¶¶ 65–70.

•      The sixth cause of action asserted that Snively acted negligently when negotiating
       the Terpene Agreement by “forcing Flotek to unnecessarily commit to an excessive,
       multimillion pound amount of an expensive product annually for five years,” which
       Snively “knew . . . would result in extreme harm to Flotek.” Id. ¶¶ 71–74.

•      The seventh cause of action asserted that ADM and Snively violated Section 31.04
       of the Texas Penal Code, which prohibits the “theft of services.” Id. ¶¶ 75–77.
       According to the petition, Snively was really working for ADM when negotiating
       the Terpene Agreement, meaning that “Flotek was deceived into paying for services
       that were not provided and for which Snively and ADM should not have been paid.”
       Id. ¶ 76.

•      The eighth cause of action asserted that ADM, the Company, and Snively engaged
       in a civil conspiracy to trick “Flotek” into executing the Terpene Agreement,
       necessitating “rescission of the Terpene Agreement and exemplary damages.” Id.
       ¶¶ 78–84.

•      The ninth cause of action sought alternative declaratory judgments regarding the
       Terpene Agreement. It asked the court to declare that the Terpene Agreement either
       is void, has been terminated, or is unenforceable. Id. ¶¶ 85–86.

D.     The Delaware Action

       ADM and the Company filed this action on April 5, 2021. The complaint names

Flotek Parent and Flotek Sub as defendants. Snively is not a party to this case.

       The complaint asserts claims for breach of the Purchase Agreement and the Terpene

Agreement. The complaint also asserts claims under a second supply agreement, but those

claims are not relevant to the current motion.

       As an initial litigation salvo, ADM and the Company moved for an anti-suit

injunction barring the defendants “from proceeding with any claims against ADM or [the

                                            11
Company] in the Texas Lawsuit that arise out of or relate to the Terpene Supply Agreement

in violation of the [Delaware Forum Provision].” Dkt. 1 at 21. They contend that all of the

claims asserted against them in the Texas Lawsuit arise out of or relate to the Terpene

Agreement.

       ADM and the Company do not seek to enjoin Flotek Parent or Flotek Sub from

pursuing their claims in the Texas Lawsuit against Snively. Snively’s employment

agreement with Flotek Parent contained a forum selection provision that required that any

dispute “arising out of or based on” his employment agreement be brought in Houston,

Texas. Dkt. 18, Ex. 1-A § 12. Of passing interest, Snively’s employment agreement also

contained a mandatory arbitration provision. Id. § 13. A dispute exists in the Texas Lawsuit

over whether the claims against Snively must be arbitrated. The plaintiffs are not seeking

an anti-suit injunction that would cover the claims against Snively, so the potential

arbitrability of those claims has no bearing on the issues addressed in this decision.

                              II.      LEGAL ANALYSIS

       To obtain a preliminary injunction, the plaintiffs must demonstrate (i) a reasonable

probability of success on the merits; (ii) that they will suffer irreparable injury if an

injunction is not granted; and (iii) that the balance of the equities favors the issuance of an

injunction. Revlon, Inc. v. MacAndrews & Forbes Hldgs., Inc., 506 A.2d 173, 179 (Del.

1986). The parties agree that the only issue is whether the Delaware Forum Provision

                                              12
governs the claims that Flotek Parent and Flotek Sub have asserted in the Texas Lawsuit.1

If it does, then the injunction will issue. If it does not, then the injunction will be denied.

       Assessing the implications of the Delaware Forum Provision involves two separate

inquiries, one for Flotek Parent and one for Flotek Sub. The Delaware Forum Provision

appears in the Purchase Agreement, and Flotek Parent is a party to that agreement. The

central question for determining whether an injunction should issue against Flotek Parent

is whether the scope of the Delaware Forum Provision encompasses the claims that Flotek

Parent has asserted in the Texas Lawsuit.

       Flotek Sub is not a party to the Purchase Agreement. That fact triggers an additional,

threshold inquiry: Does the Delaware Forum Provision in the Purchase Agreement bind

Flotek Sub? If it does, then the court must analyze whether the scope of the Delaware

Forum Provision encompasses the claims that Flotek Sub has asserted in the Texas

Lawsuit.

       1
          Dkt. 29 at 4 (counsel for plaintiffs stating during oral argument that “[a]lthough
the parties disagree on several issues, their submissions made clear that this motion
involves what we believe is a rather discrete question of contract interpretation.
Specifically, does the [Delaware Forum Provision] cover claims relating to the terpene
supply agreement?”); id. at 31 (counsel for defendants stating that “[w]e agree with the
plaintiffs that this is a narrow issue that can be decided by the application of well-
established law to largely, if not entirely, undisputed facts”); see also Dkt. 18 at 50–51 &
n.29 (defendants devoting a single paragraph in their reply brief to the elements of
irreparable harm and balancing of the equities and resting on whether the Delaware Forum
Provision applies).

                                               13
A.     Flotek Parent

       Determining whether to issue an anti-suit injunction against Flotek Parent turns on

whether the claims that Flotek Parent has asserted in the Texas Lawsuit against ADM and

the Company fall within the scope of the Delaware Forum Provision. Some do. Others do

not.

       1.     The Plain Meaning Of The Forum Selection Provision

       The Delaware Forum Provision appears in the Purchase Agreement, but Flotek

Parent’s claims in the Texas Lawsuit implicate the Terpene Agreement. Whether the

Delaware Forum Provision extends to claims that implicate the Terpene Agreement

depends on the plain language of the provision.

       The forum selection provision in the Purchase Agreement appears in a contract

governed by Delaware law, so Delaware’s principles of contract interpretation apply. When

determining the scope of a contractual obligation, “the role of a court is to effectuate the

parties’ intent.” Lorillard Tobacco Co. v. Am. Legacy Found., 903 A.2d 728, 739 (Del.

2006). Absent ambiguity, the court “will give priority to the parties’ intentions as reflected

in the four corners of the agreement, construing the agreement as a whole and giving effect

to all its provisions.” In re Viking Pump, Inc., 148 A.3d 633, 648 (Del. 2016) (internal

quotation marks omitted). “[A] contract is ambiguous only when the provisions in

controversy are reasonably or fairly susceptible of different interpretations or may have

two or more different meanings.” Rhone-Poulenc Basic Chems. Co. v. Am. Motorist Ins.

Co., 616 A.2d 1192, 1196 (Del. 1992). By contrast, a contract is unambiguous when “the

plain, common, and ordinary meaning of the words lends itself to only one reasonable

                                             14
interpretation.” Sassano v. CIBC World Mkts. Corp., 948 A.2d 453, 462 (Del. Ch. 2008).

“A contract is not rendered ambiguous simply because the parties do not agree upon its

proper construction.” Rhone-Poulenc, 616 A.2d at 1196.

       “In upholding the intentions of the parties, a court must construe the agreement as a

whole, giving effect to all provisions therein.” E.I. du Pont de Nemours & Co., Inc. v. Shell

Oil Co., 498 A.2d 1108, 1113 (Del. 1985). A reading of an agreement must be reasonable

when the contract is “read in full and situated in the commercial context between the

parties.” Chi. Bridge & Iron Co. N.V. v. Westinghouse Elec. Co. LLC, 166 A.3d 912, 926–

27 (Del. 2017). “The basic business relationship between [the] parties must be understood

to give sensible life to any contract.” Id. at 926. But this principle cannot be used to override

the plain language of the agreement: “While [our courts] have recognized that contracts

should be ‘read in full and situated in the commercial context between the parties,’ the

background facts cannot be used to alter the language chosen by the parties within the four

corners of their agreement.” Town of Cheswold v. Cent. Del. Bus. Park, 188 A.3d 810, 820

(Del. 2018) (footnote omitted) (quoting Chi. Bridge, 166 A.3d at 926–27). “[I]t is not the

job of a court to relieve sophisticated parties of the burdens of contracts they wish they had

drafted differently but in fact did not.” DeLucca v. KKAT Mgmt., L.L.C., 2006 WL 224058,

at *2 (Del. Ch. Jan. 23, 2006).

       The Delaware Forum Provision states:

       Each of the Parties hereto hereby irrevocably and unconditionally submits,
       for itself and its property, to the exclusive jurisdiction of the courts of the
       State of Delaware located in the County of New Castle, or of the United
       States of America sitting in the District of Delaware, and any appellate court
       from any thereof, in any Proceeding arising out of or relating to this

                                               15
       Agreement or any other Transaction Document or any agreements
       contemplated hereby or thereby for any reason other than the failure to serve
       process in accordance with this Section 9.8, and irrevocably waive the
       defense of an inconvenient forum or an improper venue to the maintenance
       of any such Proceeding.

SPA § 9.8.

       The plain language of the Delaware Forum Provision encompasses “any Proceeding

arising out of or relating to [1] this Agreement or [2] any other Transaction Document or

[3] any agreements contemplated hereby or thereby.” Id. (enumeration added).

       By encompassing “any Proceeding arising out of or relating to . . . any other

Transaction Document,” the plain language of the Delaware Forum Provision reaches

claims arising out of or relating to the Terpene Agreement. The Purchase Agreement

defines the term “Transaction Documents” as “this Agreement, the Transition Services

Agreement, the Escrow Agreement, the Terpene Supply Agreement, the Citrusburst

Supply Agreement, and the other written ancillary agreements, documents, instruments and

certificates executed under or in connection with this Agreement.” Id. § 10.1. The Delaware

Forum Provision thus explicitly extends to claims arising out of or relating to the Terpene

Agreement.

       By further encompassing “any Proceeding arising out of or relating to . . . any

agreements contemplated hereby or thereby,” the Delaware Forum Provision again reaches

claims under the Terpene Agreement. This aspect of the Delaware Forum Provision is

redundant, because the definition of “Transaction Documents” already includes “the other

written ancillary agreements, documents, instruments and certificates executed under or in

connection with this Agreement.” Id. Nevertheless, the Terpene Agreement indisputably is

                                            16
an agreement “contemplated” by the Purchase Agreement, which attached a substantively

final version of the Terpene Agreement as an exhibit, obligated Flotek Parent to cause the

Company and Flotek Sub to enter into the Terpene Agreement, and required Flotek Parent

to deliver an executed copy of the Terpene Agreement at closing.

       2.     The Terpene Integration Clause

       To reach the opposite conclusion, Flotek Parent relies on an integration clause in

the Terpene Agreement and contends that it supersedes the Delaware Forum Provision in

the Purchase Agreement. The integration clause in the Terpene Agreement states: “This

Agreement and the other agreements referred to herein set forth the entire understanding

of the parties hereto relating to the subject matter hereof and thereof and supersede all prior

agreements and understandings among or between any of the parties relating to the subject

matter hereof and thereof.” TSA § 32 (the “Terpene Integration Clause”).

       The Terpene Agreement does not contain a forum selection provision, and the

Terpene Agreement does not refer to the Purchase Agreement. Read literally, the Terpene

Integration Clause would eliminate the Delaware Forum Provision. Such a literal reading

is not tenable.

       The Purchase Agreement and the Terpene Agreement are contemporaneous

contracts and accordingly must be read together. As a matter of black letter law, “all

writings that are part of the same transaction are interpreted together.” Restatement

(Second) of Contracts § 202(2). Delaware follows this principle and holds that, as a general

rule, “contemporaneous contracts between the same parties concerning the same subject

                                              17
matter should be read together as one contract.” Comerica Bank v. Glob. Payments Direct,

2014 WL 3567610, at *7 (Del. Ch. July 21, 2014) (collecting authorities).

      Viewed realistically as part of the real-world business context, the Purchase

Agreement and the Terpene Agreement were executed together to effectuate the

Transaction. The Purchase Agreement contained a covenant that required that Flotek

Parent cause the Company and Flotek Sub to enter into the Terpene Agreement and made

the Terpene Agreement a closing deliverable. An unsigned version of the Terpene

Agreement in substantially final form was an exhibit to the Purchase Agreement. Between

signing and closing, the only change to the Terpene Agreement was to add addresses in the

notice provision. Dkt. 25 Ex. E. At closing, Flotek Parent delivered an executed copy of

the Terpene Agreement, and the Transaction closed. The two contracts are properly read

as a single agreement.

      The Purchase Agreement contains an integration clause which confirms that the

Purchase Agreement and the Terpene Agreement should be read together as a unitary

contractual scheme. The integration clause in the Purchase Agreement states:

      This Agreement (including the Exhibits and Schedules hereto), the
      Confidentiality Agreement and the other Transaction Documents . . .
      constitute the entire agreement among the Parties with respect to the subject
      matter hereof and thereof and supersede other prior agreements and
      understandings both written and oral among the Parties with respect to the
      subject matter hereof and thereof . . . .

SPA § 9.2 (the “Integration Clause”). The Purchase Agreement defines “Agreement” to

mean “this Agreement, including . . . any Exhibits and Schedules attached hereto.” Id. §

10.1. The Terpene Agreement appeared as Exhibit B to the Purchase Agreement. See id. §

                                           18
5.14, Ex. B. The plain language of the Integration Clause thus makes the Terpene

Agreement part of the Purchase Agreement. See Weygandt v. Weco, LLC, 2009 WL

1351808, at *2 (Del. Ch. May 14, 2009) (“The Lease Agreement was one of the defined

‘Transaction Documents,’ and thus constituted part of the entire agreement . . . .” (alteration

and internal quotation marks omitted)).

         The plain language of the Delaware Forum Provision in the Purchase Agreement

thus binds Flotek Parent as a signatory and extends to any claims that Flotek Parent might

bring under the Terpene Agreement. The Terpene Integration Clause does not change that

result. See CA, Inc. v. Ingres Corp. (Ingres Trial), 2009 WL 4575009, at *48 (Del. Ch.

Dec. 7, 2009), (holding that a forum selection provision in the more “fundamental”

agreement applied to an ancillary agreement that did not contain a forum selection

provision, despite an integration clause in the ancillary agreement), aff’d, 8 A.3d 1143 (Del.

2010).

         3.    Claim-By-Claim Analysis

         The next step is to determine which of Flotek Parent’s claims in the Texas Lawsuit

fall within the scope of the Delaware Forum Provision. The inquiry requires a claim-by-

claim analysis.

         The Delaware Forum Provision applies to claims “arising out of or relating to” the

Terpene Agreement. Black’s Law Dictionary defines “arise” to mean “[t]o originate; to

stem (from).” Arise, Black’s Law Dictionary (11th ed. 2019). “[W]here parties to a contract

animate their forum selection clause with ‘arising out of’ language, as long as the claims

‘stem from the contractual relationship,’ then ‘an action need not allege contract-based

                                              19
claims in order for the forum selection clause in the contract to be enforced.’” SPay, Inc.

v. Stack Media Inc., 2021 WL 1109181, at *3 (Del. Ch. Mar. 23, 2021) (alterations omitted)

(quoting Carlyle Inv. Mgmt. LLC v. Moonmouth Co. SA, 779 F.3d 214, 220 (3d Cir. 2015)).

For a claim to “stem from the contractual relationship,” it must be “based on the rights and

obligations created by the underlying agreement.” Parfi Hldg. AB v. Mirror Image Internet,

Inc., 817 A.2d 149, 151 (Del. 2002). When a claim is based on duties that exist

independently of the agreement containing the forum selection provision, “the analysis

must turn on the issue of whether the . . . claim[] would be assertable” in the absence of the

agreement. Id. at 157.

       The phrase “relating to” is broader than the phrase “arising out of.” Black’s Law

Dictionary defines “relating to” to mean “to have some relation to” or “to have bearing or

concern [on]; [to] pertain.” Relating to, Black’s Law Dictionary (5th ed. 1979). “[O]ur

courts have considered the connector ‘relating to’ to be ‘paradigmatically broad.’” 2

Compared to the phrase “arising out of,” “[t]he term ‘related to’ is typically defined more

       2
         Pharm. Prod. Dev. Inc. v. TVM Life Sci. Ventures VI, L.P., 2011 WL 549163, at
*5 (Del. Ch. Feb. 16, 2011) (quoting Lillis v. AT & T Corp., 904 A.2d 325, 331 (Del. Ch.
2006)); see Delucca v. KKAT Mgmt., L.L.C., 2006 WL 224058, at *10 n.34 (Del. Ch. Jan.
23, 2006) (describing the “broad scope” created by the phrase “relating to”); Town of
Smyrna v. Kent Cty. Levy Ct., 2004 WL 2671745, at *2 (Del. Ch. Nov. 9, 2004) (“[T]here
is no question that the arbitration clause found in the Agreement is broad, as it covers all
claims ‘arising out of’ or ‘related to’ the Agreement.”); see also Morales v. Trans World
Airlines, Inc., 504 U.S. 374, 383 (1992) (“The ordinary meaning of [‘relating to’] is a broad
one—‘to stand in some relation; to have bearing or concern; to pertain; refer; to bring into
association with or connection with,’—and the words thus express a broad . . . purpose.”
(citation omitted) (quoting Black’s Law Dictionary, supra)).

                                             20
broadly and is not necessarily tied to the concept of a causal connection. Webster’s

Dictionary defines ‘related’ simply as ‘connected by reason of an established or

discoverable relation.’” Coregis Ins. Co. v. Am. Health Found., Inc., 241 F.3d 123, 128 (2d

Cir. 2001) (quoting Webster’s (Third) New International Dictionary 1916 (1986)). The use

of the phrase “related to” thus expands the scope of the Delaware Forum Provision beyond

the universe of claims “based on the rights and obligations created by the underlying

agreement.” Parfi, 817 A.2d at 151; see Abry P’rs, L.P. v. F & W Acq. LLC, 891 A.2d

1032, 1047 (Del. Ch. 2006) (holding that the phrase “relating to” caused a choice-of-law

provision to govern not only “contract claims that might arise among the parties,” but also

“claims in tort seeking rescission” of the agreement). A provision that extends to matters

“relating to” an agreement encompasses “any issues that ‘touch on contract rights or

contract performance.’” ASDC Hldgs., LLC v. Richard J. Malouf 2008 All Smiles Grantor

Retained Annuity Tr., 2011 WL 4552508, at *5 (Del. Ch. Sept. 14, 2011) (quoting Parfi,

817 A.2d at 155).

              a.     The Claims Against Snively

       In the first, second, and sixth causes of action in the Texas Lawsuit, Flotek Parent

and Flotek Sub asserted the following claims against Snively:

•      The first cause of action asserts a claim against Snively for breaching his fiduciary
       duties when negotiating the Terpene Agreement.

•      The second cause of action asserts a claim against Snively for breaching his
       employment agreement when negotiating the Terpene Agreement.

•      The sixth cause of action asserts a claim against Snively for acting negligently when
       negotiating the Terpene Agreement.

                                            21
ADM and the Company do not assert that the Delaware Forum Provision applies to these

claims, and they do not seek an anti-suit injunction to prevent Flotek Parent or Flotek Sub

from asserting these claims.

       As a segue into the analysis of the other claims in the Texas Lawsuit, it is helpful to

consider which Texas plaintiff has asserted these causes of action. The petition in the Texas

Lawsuit does not specify whether a particular cause of action is asserted by Flotek Parent

or Flotek Sub. It nevertheless is possible to infer who could bring the claim from the legal

relationships involved:

•      Flotek Parent is the logical plaintiff for the first cause of action, because Snively
       was an employee and executive of Flotek Parent and would have owed fiduciary
       duties to Flotek Parent in that capacity. There is no indication that Snively was an
       employee (or officer or director) of Flotek Sub.

•      Flotek Parent is the logical party to have asserted the second cause of action, because
       it is the counterparty under Snively’s employment agreement and therefore would
       have standing to sue for breach.

•      Either Flotek Parent or Flotek Sub could be a logical plaintiff for the sixth cause of
       action, which asserts a claim against Snively for acting negligently. That claim
       invokes Snively’s common law duty to “exercise reasonable care to make his acts
       safe for others.” Restatement (Second) of Torts § 4 cmt. b. Either Flotek Parent or
       Flotek Sub could have been injured by Snively and have standing to bring such a
       claim.

Again, ADM and the Company are not seeking an anti-suit injunction addressing these

claims, but they are seeking to enjoin related claims.

              b.     The Claims That Arise Out Of The Terpene Agreement

       The fifth, eighth, and ninth causes of action in the Texas Lawsuit arise out of the

Terpene Agreement. These claims fall within the Delaware Forum Provision.

                                             22
       The fifth cause of action in the Texas Lawsuit asserts a claim for breach of the

Terpene Agreement against the Company. The petition maintains that ADM and the

Company breached the Terpene Agreement by failing to permit Flotek Sub to inspect the

Company’s terpene facility and audit its books and records. The petition does not state

whether Flotek Parent or Flotek Sub has asserted this claim, but presumably it is Flotek

Sub. As a general matter, only a party to a contract has standing to enforce it, so Flotek

Sub should be the plaintiff. Likewise, only a party to a contract has contractual obligations

under the contract, so only the Company should be a defendant. Setting those issues aside,

the claim plainly arises out of the Terpene Agreement. To the extent that Flotek Parent

asserts the fifth cause of action in the Texas Lawsuit, the Delaware Forum Provision

mandates that Flotek Parent bring that claim in Delaware.

       The eighth cause of action in the Texas Lawsuit asserts a claim for civil conspiracy

against ADM, the Company, and Snively, contending that they conspired to negotiate the

Terpene Agreement to benefit themselves and harm Flotek Parent and Flotek Sub. As a

remedy, this cause of action seeks rescission of the Terpene Agreement. Once again, the

petition in the Texas Lawsuit does not state whether Flotek Parent or Flotek Sub has

asserted this claim, but it again seems likely that only Flotek Sub, as a party to the Terpene

Agreement, would have standing to assert it. Regardless, the claim arises out of the Terpene

Agreement. Analytically, it resembles a claim for fraudulent inducement in that it asserts

that ADM, the Company, and Snively conspired to induce Flotek Sub to enter into the

Terpene Agreement. This court has held that a claim for fraudulent inducement arises out

of the contract that the plaintiff was fraudulently induced to execute, bringing the claim

                                             23
within the scope of the forum selection provision in the agreement.3 The same is true for

the conspiracy claim. Accordingly, to the extent that Flotek Parent asserts the eighth cause

of action in the Texas Lawsuit, the Delaware Forum Provision mandates that Flotek Parent

bring that claim in Delaware.

       The ninth cause of action in the Texas Lawsuit seeks declaratory judgments

regarding the Terpene Agreement. That cause of action advances three theories in the

alternative. The first theory asserts that the Terpene Agreement is “void due to Defendants’

wrongful conduct.” Dkt. 1, Ex. E ¶ 86. The second theory asserts that the Terpene

Agreement “has been terminated,” meaning that “Flotek does not owe [the Company] any

monies.” Id. The third theory asserts that the Terpene Agreement is “not enforceable during

a global epidemic . . . under principles of force majeure.” Id. Yet again, the petition in the

Texas Lawsuit does not state whether Flotek Parent or Flotek Sub has asserted this claim,

but once again, the logical party is Flotek Sub because that entity was a party to the Terpene

Agreement. Nevertheless, the claim plainly arises out of the Terpene Agreement. To the

       3
         See Parfi Hldg. AB v. Mirror Image Internet, Inc., 794 A.2d 1211, 1226 (Del. Ch.
2001) (“The first phrase of the clause, which requires arbitration of claims ‘arising out of’
the Agreement, would seem to cover direct claims for breach of the Agreement or fraud in
the inducement.”), rev’d on other grounds, 817 A.2d 149 (Del. 2002); see SPay, 2021 WL
1109181, at *3 (“While a fraud claim was not directly before the court in Parfi, the [trial]
court’s observation regarding the connection between a fraudulent inducement claim and
the contract the plaintiff alleges he was induced to enter stands out as entirely logical and
consistent with the elements of a fraudulent inducement claim. . . . [D]etrimental reliance
in the context of an inducement to enter into a contract necessarily presupposes that a
contract exists; if there is no contract, then there is no reliance/inducement and likely no
resulting harm.” (footnotes and internal quotation marks omitted)).

                                             24
extent that Flotek Parent asserts the ninth cause of action in the Texas Lawsuit, the

Delaware Forum Provision mandates that Flotek Parent bring that claim in Delaware.

              c.     The Claims That Relate To The Terpene Agreement

       Two other claims in the Texas Lawsuit do not arise under the Terpene Agreement,

but do relate to that agreement. The Delaware Forum Provision applies to these claims.

       The third cause of action in the Texas Lawsuit asserts a claim against ADM for

tortious interference with Snively’s employment agreement. True to form, the petition in

the Texas Lawsuit does not state whether Flotek Parent or Flotek Sub has asserted this

claim, but only a party to the contract should be able to assert that another party interfered

with its contractual rights. Flotek Parent was the counterparty under Snively’s employment

agreement. Presumably, therefore, Flotek Parent brought this claim and not Flotek Sub.

       Under Texas law, “[t]he elements of tortious interference with a contract are: (1) the

existence of a contract subject to interference; (2) willful and intentional interference; (3)

interference that proximately caused damage; and (4) actual damage or loss.” Powell

Indus., Inc. v. Allen, 985 S.W.2d 455, 456 (Tex. 1998). Based on these elements, the claim

for tortious interference does not arise under the Terpene Agreement. The contract at the

heart of the claim for tortious interference is Snively’s employment agreement, not the

Terpene Agreement. The source of ADM’s obligation not to interfere with Snively’s

employment agreement also does not arise under or relate to the Terpene Agreement; it

arises under the “general [common law] duty not to interfere intentionally with another’s

reasonable business expectancies of trade with third persons.” Restatement (Second) of

                                             25
Torts § 766 cmt. b. The “arising under” language in the Delaware Forum Provision does

not extend to this claim.

       The claim for tortious interference nevertheless relates to the Terpene Agreement to

a sufficient degree to fall within the Delaware Forum Provision. The negotiations over the

Terpene Agreement provide the factual backdrop for the claim. Whether Snively breached

his obligations depends in large part on the terms of the Terpene Agreement and whether

they disproportionately benefited the Company and harmed Flotek Sub. The damages that

Flotek Sub has identified specifically in the Texas Lawsuit relate to the Terpene

Agreement. The ad damnum request states:

       [D]amages include, but are not limited to: (a) the cost of excess terpene that
       Flotek was forced to buy and could not sell or otherwise use; (b) the cost of
       storage of the excess terpene; and (c) the $15.75 million dollars Flotek was
       required to pay to ADM in order for ADM to agree to any amendments to
       the [Terpene Agreement].

Dkt. 1, Ex. E ¶ 59. In addition, the claim for tortious interference seeks rescission of the

Terpene Agreement. Id. A claim that seeks rescission of an agreement relates to that

agreement. See Abry, 891 A.2d at 1047 (holding that choice-of-law provision employing

“relating to” language extended to claims seeking rescission of the agreement).

       An obvious practical difficulty is that the claim for tortious interference with

Snively’s employment agreement depends on Flotek Parent establishing a breach of

Snively’s employment agreement. The latter claim is not subject to the Delaware Forum

Provision. It is neither efficient nor desirable to litigate Flotek Parent’s claim for breach of

the employment agreement against Snively in one forum while litigating Flotek Parent’s

claim for tortious interference with Snively’s employment agreement against ADM in a

                                              26
different forum. Nevertheless, that is what the Delaware Forum Provision requires. The

risk of wasting judicial resources can be addressed by staying the secondary claim for

tortious interference against ADM pending adjudication of the primary claim for breach of

the employment agreement against Snively.4

       The fourth cause of action in the Texas Lawsuit asserts a claim against ADM for

aiding and abetting Snively’s breaches of his fiduciary duties. To the extent that the

fiduciary duty claim rests on Snively’s duties as an employee, then presumably Flotek

Parent asserted this claim. To the extent the fiduciary duty claim rests on Snively’s status

as an officer or director, then the corporate entity where he served in those capacities would

be the proper entity to assert it. Again, there is no indication that Snively was an employee,

officer, or director of Flotek Sub.

       For purposes of the Delaware Forum Provision, the analysis of the fourth cause of

action parallels the analysis of the cause of action for tortious interference with Snively’s

employment agreement. The claim against ADM for aiding and abetting Snively’s

breaches of fiduciary duty does not arise under the Terpene Agreement, but it relates

       4
         Attentive readers will note that competing forum selection provisions in the
Purchase Agreement and Snively’s employment agreement generate a result for claims
arising under those agreements that this court construes the Delaware Forum Provision to
avoid for purposes of the Purchase Agreement and Terpene Agreement. The disconnect
between the Purchase Agreement and Snively’s employment agreement is unfortunate but
understandable: The agreements were entered into at different times and involve different
subjects. The Purchase Agreement and the Terpene Agreement were part of the same
overarching transaction. It is not reasonable to interpret the Delaware Forum Provision as
creating a similarly problematic jurisdictional framework.

                                             27
sufficiently to the Terpene Agreement to fall within the scope of the Delaware Forum

Provision. See ASDC Hldgs., 2011 WL 4552508, at *8 (noting that although defendant’s

fiduciary duties arose under common law, the facts giving rise to the claim “relate[d] to”

the agreements covered by a forum selection provision). The cause of action also seeks

rescission of the Terpene Agreement as a remedy, which plainly relates to the agreement.

Dkt. 1, Ex. E ¶ 64. The Delaware Forum Provision mandates that Flotek Parent bring the

claim for aiding and abetting in this court.

       As with the cause of action for tortious interference, the cause of action for aiding

and abetting raises inefficiencies, because the underlying cause of action for breach of

fiduciary duty will go forward in Texas. To promote judicial efficiency, the potential for

wasted resources can be addressed by staying the secondary claim for aiding and abetting

against ADM pending adjudication of the primary claim for breach of fiduciary duty

against Snively.

              d.     The Unrelated Claim

       A final claim does not arise under or relate to the Terpene Agreement. The seventh

cause of action in the Texas Lawsuit asserts a claim against Snively and ADM for theft of

services under the Texas Theft Liability Act, 6 Tex. Civ. Prac. & Rem. Code Ch. 134

(1989) (the “Theft Act”). This cause of action maintains that because Snively was really

working for ADM when negotiating the Terpene Agreement, “Flotek was deceived into

paying for services that were not provided and for which Snively and ADM should not

have been paid.” Dkt. 1, Ex. E ¶ 76. It is again unclear which Flotek entity has asserted this

                                               28
claim, but because Snively was an employee of Flotek Parent, presumably Flotek Parent

maintains that its services were stolen.

       Section 31.04 of the Texas Penal Code states:

       (a)    A person commits theft of service if, with intent to avoid payment for
              service that the actor knows is provided only for compensation:

              (1)    the actor intentionally or knowingly secures performance of
                     the service by deception, threat, or false token;

              (2)    having control over the disposition of services of another to
                     which the actor is not entitled, the actor intentionally or
                     knowingly diverts the other’s services to the actor’s own
                     benefit or to the benefit of another not entitled to the services;

              (3)    having control of personal property under a written rental
                     agreement, the actor holds the property beyond the expiration
                     of the rental period without the effective consent of the owner
                     of the property, thereby depriving the owner of the property of
                     its use in further rentals; or

              (4)    the actor intentionally or knowingly secures the performance
                     of the service by agreeing to provide compensation and, after
                     the service is rendered, fails to make full payment after
                     receiving notice demanding payment.

Tex. Penal Code § 31.04 (2019).

       The petition in the Texas Lawsuit asserts a claim under Section 31.04 (the “Theft-

of-Services Claim”). The petition, however, provides little detail about the claim. The

petition asserts only that “Snively owed Flotek faithful service,” that “[t]hrough the

conduct of ADM and Snively, the expected faithful service was stolen from Flotek,” and

that “Flotek was deceived into paying for services that were not provided and for which

Snively and ADM should not have been paid.” See Dkt. 1, Ex. E ¶ 76. As best the court

can tell, Flotek Parent is attempting to assert that ADM had “control over the disposition

                                             29
of [Snively’s] services” for purposes of Section 31.04(a)(2) and diverted them to its own

benefit during the negotiations over the Terpene Agreement.

       For purposes of the Delaware Forum Provision, the Theft-of-Services Claim

resembles the claims for tortious interference and aiding and abetting, but is one further

step removed. Like those claims, the Theft-of-Services Claim does not arise under the

Terpene Agreement. The Theft-of-Services Claim plainly arises under a Texas statute. But

also like those other claims, the Theft-of-Services Claim relates to the Terpene Agreement.

The negotiations over the Terpene Agreement provide the factual basis for the claim, and

whether ADM “stole” services from Flotek Parent depends on whether the Terpene

Agreement disproportionately favored the Company rather than Flotek Sub.

       A critical difference between the claims for tortious interference and aiding and

abetting, on the one hand, and the Theft-of-Services Claim, on the other, is the remedy

sought. The Theft-of-Services Claim seeks damages under the Theft Act, which makes “[a]

person who commits theft . . . liable for the damages resulting from the theft.” 6 Tex. Civ.

Prac. & Rem. Code § 134.003. For purposes of ADM’s alleged theft of Snively’s services,

the statute would seem to call for a remedy tied to the value of Snively’s services, rather

than a damages award based on the Terpene Agreement. It also seems unlikely that Flotek

would seek (much less obtain) rescission of the Terpene Agreement as the remedy for

ADM’s theft of Snively’s services.

       Bringing the Theft-of-Services Claim within the scope of the Delaware Forum

Provision is one step too far. Considerations of comity also support this conclusion. A

Texas court is far better equipped than this court to adjudicate a claim under a Texas statue,

                                             30
and the Theft Act expresses a preference that “[a] suit under this chapter may be brought

in the county where the theft occurred or in the county where the defendant resides.” Id. §

134.004. The Delaware Forum Provision does not apply to the Theft-of-Services Claim.

B.     Flotek Sub

       Because Flotek Sub is not a party to the agreement that contains the Delaware Forum

Provision, a threshold question arises as to whether the Delaware Forum Provision binds

Flotek Sub. The plaintiffs advance two rationales for binding Flotek Sub.

       First, they argue that the Purchase Agreement and the Terpene Agreement must be

treated as a single agreement, resulting in the Delaware Forum Provision in the Purchase

Agreement binding the parties to the Terpene Agreement. That theory is contrary to

precedent and fails.

       Second, they argue that the Delaware Forum Provision binds Flotek Sub under

principles of estoppel. That theory succeeds.

       Having answered the threshold question, the court’s next task is to determine which

claims are covered by the provision. The Delaware Forum Provision applies equally to

Flotek Parent and Flotek Sub, and the two entities have asserted the same claims in the

Texas Lawsuit. Consequently, the outcome of the analysis is the same for both entities.

       1.     The Single-Agreement Theory

       ADM and the Company first contend that the Purchase Agreement and the Terpene

Agreement must be read together as a single agreement, causing the Delaware Forum

Provision to bind the parties to both agreements. In making this argument, ADM and the

Company go beyond asserting that the two agreements should be read consistently. They

                                            31
maintain that the Delaware Forum Provision should be treated as if it were a term that

appears in the Terpene Agreement, thereby binding Flotek Sub. Dkt. 7 at 12.

      It is true that, for the reasons discussed previously, the Purchase Agreement and the

Terpene Agreement must be read consistently. The court applied that principle when

evaluating whether the Delaware Forum Provision extended to the claims that Flotek

Parent asserted in the Texas Lawsuit. Flotek Parent is a party to the Purchase Agreement

and indisputably is bound by the Delaware Forum Provision. Consequently, when

determining whether the Delaware Forum Provision applies to claims that Flotek Parent

might assert that arise out of or relate to the Terpene Agreement, the court read the two

agreements as a whole.

      The same reasoning does not apply to Flotek Sub’s claims under the Terpene

Agreement. The instructive precedent is Weygandt, in which the buyer purchased a repair

business from the seller under an asset purchase agreement. 2009 WL 1351808, at *1. The

purchase agreement contemplated that the buyer would execute a lease agreement (the

“Lease”) with a controlled affiliate of the seller (the “Landlord”), and the purchase

agreement conditioned both sides’ obligation to close on the execution of the Lease. Id.

The Landlord did not sign the purchase agreement. When disputes arose between the buyer

and seller, the seller sued the buyer in Delaware. The buyer asserted counterclaims against

the seller and a third party claim against the Landlord. To obtain jurisdiction over the

Landlord, the buyer argued that the Landlord was bound by a forum selection provision in

the purchase agreement. As one basis for binding the Landlord, despite the Landlord’s

failure to sign the purchase agreement, the buyer invoked “the general rule that agreements

                                            32
that are part of the same transaction are construed together.” Id. at *3. The court rejected

the “proposition that, under the single agreement theory, a party can be bound to terms not

contained in any document the party executed.” Id. at *4. Elaborating, the court explained

that adopting the single-agreement theory would “conflict with Delaware’s general policy

of not extending the rights and obligations of contracts to parties that did not execute them,

absent special circumstances.” Id.

       In this case, Flotek Sub is not a party to the Purchase Agreement, and the Terpene

Agreement does not contain a forum selection provision. By asking the court to read the

two agreements as one, ADM and the Company seek to collapse the distinctions between

the two agreements. The single-agreement theory cannot achieve that result.

       2.     The Capital Group Test

       Alternatively, ADM and the Company argue that the Delaware Forum Provision

binds Flotek Sub under a line of precedent traceable to the Capital Group decision. That

line of authority holds that a court can enforce a forum selection provision against a non-

signatory if the following three elements are met: (i) the agreement contains a valid forum

selection provision; (ii) the non-signatory has a sufficiently close relationship to the

agreement, either as an intended third-party beneficiary under the agreement or under

principles of estoppel, and (iii) the claim potentially subject to the forum selection

provision arises from the non-signatory’s standing relating to the agreement. Cap. Gp.,

2004 WL 2521295, at *5; see Neurvana Med., LLC v. Balt USA, LLC, 2019 WL 4464268,

at *3 (Del. Ch. Sept. 18, 2019) (explicating test).

                                             33
       The parties agree that the Delaware Forum Provision meets the first element of the

test. The parties dispute the second and third elements. Both are satisfied, resulting in the

provision binding Flotek Sub.

       3.     The Second Element

       Under the second element of the Capital Group test, a forum selection provision

can bind a non-signatory that has a sufficiently close relationship to the agreement, either

as an intended third-party beneficiary under the agreement or based on principles of

estoppel. The plaintiffs do not argue that Flotek Sub was an intended third-party

beneficiary of the Purchase Agreement, so this decision only considers principles of

estoppel.5

       Under principles of estoppel, a forum selection provision can bind the non-signatory

if (i) the non-signatory accepted a direct benefit from the agreement or (ii) the non-

signatory had a close relationship to the agreement, a signatory to the agreement controlled

the non-signatory, and the circumstances establish that the signatory agreed to the forum

selection provision on behalf of its controlled affiliate. See Sustainability P’rs LLC v.

       5
         As an aside, the decisions that rely on a non-signatory’s status as a third-party
beneficiary are really applying a species of equitable estoppel. Those decisions reason that
a party cannot invoke the benefits of an agreement by asserting its standing as a third-party
beneficiary, then attempt to avoid the burdens associated with the agreement, such as a
forum selection provision. See Coastal Steel Corp. v. Tilghman Wheelabrator Ltd., 709
F.2d 190, 202-03 (3d Cir. 1983), overruled on other grounds by Lauro Lines v. Chasser,
490 U.S. 495 (1989); Hadley v. Shaffer, 2003 WL 21960406, *4 (D. Del. Aug. 12, 2003).

                                             34
Jacobs, 2020 WL 3119034, at *6 (Del. Ch. June 11, 2020). The two tests are disjunctive.

Neurvana, 2019 WL 4464268, at *1.

       The direct-benefit test rests on principles of equitable estoppel. It prevents a party

from accepting the benefits of an agreement without accepting all of its burdens, such as

the obligation to comply with a forum selection provision. See id. at *3.

       The foreseeability test introduces a measure of promissory estoppel. It rests on the

principle that a party can promise to litigate in a particular forum on behalf of itself and a

controlled affiliate. Having induced its counterparties to rely on that promise, the party

cannot later renege on its promise by using a controlled affiliate to escape the forum

selection provision. See id. at *5.

              a.      The Direct-Benefit Test

       The direct-benefit prong of the second element of the Capital Group test reflects the

principle that “[i]n general, a non-signatory is estopped from refusing to comply with a

forum selection clause when she receives a ‘direct benefit’ from a contract containing a

forum selection clause.” Cap. Gp., 2004 WL 2521295, at *6. The direct benefit may arise

at the time of contracting, or a party may accept the benefits of an agreement after it was

executed. See id. at *6 n.40. In the latter circumstances, “an estoppel may arise in light of

the knowing acceptance of the benefits of the contract.” Jacobs, 2020 WL 3119034, at *6.

       “Delaware courts have deemed both pecuniary and non-pecuniary benefits

sufficient to satisfy the test.” Neurvana, 2019 WL 4464268, at *4 (collecting cases). The

benefits must be direct; “indirect benefits have been deemed insufficient.” Id. And they

                                             35
must actually be received; “the mere ‘contemplation’ of a benefit does not directly confer

one.” Id.

       Flotek Sub benefited directly from the Purchase Agreement, because the Purchase

Agreement led to the execution of the Terpene Agreement. Once Flotek Parent sold the

Company to ADM, Flotek Sub would need a source of terpene. The Terpene Agreement

provided Flotek Sub with a source, conferring a direct benefit.

       Flotek Sub knowingly accepted those benefits when it purchased terpene under the

Terpene Agreement. The doctrine of equitable estoppel prevents a party who knowingly

accepts a benefit from “embracing the contract, and then turning [its] back on the portions

of the contract, such as a forum selection clause, that [it] finds distasteful.” Id. at *3

(internal quotation marks omitted). Flotek Sub accepted a benefit of the Purchase

Agreement by entering into the Terpene Agreement. Flotek Sub then received the benefit

of that agreement by purchasing terpene from the Company. After later repudiating the

Terpene Agreement, Flotek Sub embraced it again by entering into the Amended Terpene

Agreement. Flotek Sub cannot now avoid the burdens that accompanied those benefits.

       This court’s reasoning in Weygandt supports this result. The Lease in that case was

only needed “if the sale of the business closed.” Weygandt, 2009 WL 1351808, at *1. The

Weygandt court held that the Lease provided “a direct benefit to” the non-signatory

Landlord and was “a benefit that [the buyer] only agreed to provide because the Asset

Purchase Agreement required [it].” Id. In this case, the Company and Flotek Sub only

needed a contractual relationship if the Transaction closed. Otherwise, Flotek Parent would

have continued to own both the Company and Flotek Sub and could direct the Company to

                                            36
sell terpene to Flotek Sub. The Terpene Agreement existed and benefited Flotek Sub

because the Purchase Agreement required it.

       Flotek Sub has argued that it did not receive a benefit from the Terpene Agreement

because the contract was skewed in ADM’s favor. According to Flotek Sub, the Terpene

Agreement provided the Company with a stream of revenue, but only burdened Flotek Sub

with a contractual take-or-pay commitment at a cost-plus price. Dkt. 18 at 42 n.25. It is

true that the Terpene Agreement provided the Company with a stream of revenue, but it

also provided Flotek Sub with a source of terpene. That is sufficient to meet the direct-

benefit test. The law does not require a weighing of the relative benefits before binding a

non-signatory to a forum selection provision under principles of equitable estoppel. Flotek

Sub entered into the Terpene Agreement, knowingly accepted the benefits of that

agreement by purchasing terpene from the Company, then again knowingly accepted its

benefits by entering into the Amended Terpene Agreement and making further purchases.

The direct-benefit test is satisfied.

               b.     The Foreseeability Test

       The foreseeability prong of the second element of the Capital Group test applies

when the circumstances surrounding the transaction make it clear that the parties expected

the forum selection provision to bind the non-signatory. Delaware courts apply the

foreseeability test cautiously. Neurvana, 2019 WL 4464268, at *6. One scenario where it

applies is when a signatory to an agreement controls a non-signatory that is closely related

to the transaction. “[W]hen a control person agrees to a forum, it is foreseeable that the

                                            37
entities controlled by that person which are involved in the deal will also be bound to that

forum.” Weygandt, 2009 WL 1351808, at *5. The foreseeability inquiry

       recognizes that parties to agreements do not always think about having
       controlled entities sign on to a deal, or they do not take the time to have them
       do so, because it is readily apparent that the controller is acting on behalf of
       the entities on his side of the deal.

iModules Software, Inc. v. Essenza Software, Inc., 2017 WL 6596880, at *4 (Del. Ch. Dec.

22, 2017) (ORDER). By binding controlled affiliates, the foreseeability inquiry

“promote[s] stable and dependable trade relations” by preventing the entities through

which one of the parties chooses to act from escaping the forum selection provision.

Weygandt, 2009 WL 1351808, at *5 (internal quotation marks omitted). The foreseeability

inquiry thus forecloses “an ‘end-run around an otherwise enforceable forum selection

provision.’” Neurvana, 2019 WL 4464268, at *5 (alterations omitted) (quoting Ashall

Homes Ltd. v. ROK Ent. Gp. Inc., 992 A.2d 1239, 1248 (Del. Ch. 2010)).

       The foreseeability test does not extend to all non-signatories that a signatory

happens to control. Id. at *6. It only extends to controlled non-signatories with “a clear and

significant connection to the subject matter of the agreement.” Id. (internal quotation marks

omitted).

       In this case, it was foreseeable that the Delaware Forum Provision would bind

Flotek Sub. Flotek Parent controlled Flotek Sub as its wholly owned subsidiary. Flotek Sub

had a clear and significant relationship to the Purchase Agreement because it was the entity

through which Flotek Parent carried out one of its contractual obligations. The Purchase

Agreement attached a substantively final version of the Terpene Agreement as an exhibit,

                                             38
it contained a covenant that required Flotek Parent to cause Flotek Sub to enter into the

Terpene Agreement, and it obligated Flotek Parent to deliver an executed version of the

Terpene Agreement at closing. When Flotek Parent bound itself to the Delaware Forum

Provision for any claim arising out of or relating to the Terpene Agreement, Flotek Parent

made that promise on behalf of itself and Flotek Sub.

       There are also other textual signals in the Purchase Agreement which indicate that

Flotek Parent sought to bind controlled subsidiaries like Flotek Sub. As discussed

previously, the Integration Clause defined the parties’ “entire agreement” to include the

exhibits to the Purchase Agreement and “the other Transaction Documents.” SPA § 9.2.

The Terpene Agreement was both an exhibit to the Purchase Agreement and a “Transaction

Document.” The Delaware Forum Provision encompasses claims arising out of or relating

to the Terpene Agreement, and the Terpene Agreement itself did not contain a forum

selection provision. The logical inference is that the parties expected the Delaware Forum

Provision to bind Flotek Sub.6

       6
         Although this decision does not rely on this language, the Delaware Forum
Provision also contains another textual signal that the parties intended to bind Flotek Sub.
In the Delaware Forum Provision, Flotek Parent submitted to the exclusive jurisdiction of
the Delaware courts “for itself and its property.” SPA § 9.8. That is odd language, and the
parties debate its meaning. One reasonable reading of the provision is that it would extend
to Flotek Parent’s ownership interests in subsidiaries, including wholly owned subsidiaries
like Flotek Sub. Under Oklahoma law, which governs the internal affairs of Flotek Sub,
the member interests in Flotek Sub are personal property. 18 Okla. St. § 2032. By agreeing
to the Delaware Forum Provision on behalf of its property, Flotek Parent agreed to the
provision on behalf of Flotek Sub, which was its property.

                                            39
       Those facts are sufficient to establish a clear and significant connection between

Flotek Sub and the subject matter of the Purchase Agreement. That connection is sufficient

for the forum-selection-related promise by Flotek Parent (the signatory) to bind Flotek Sub

(the controlled affiliate) under the foreseeability test.

       4.     The Third Element

       The third element of the Capital Group test asks whether the claim potentially

subject to the forum selection provision arises from the non-signatory’s “standing relating

to” the agreement containing the forum selection provision. See Neurvana, 2019 WL

4464268, at *3; Cap. Gp., 2004 WL 2521295, *5. In this context, the meaning attributed

to the concept of standing is not self-evident, and subsequent cases have read the language

as imposing a substantive limitation on the extent to which a forum selection provision can

bind a non-party. In my view, that interpretation warrants reconsideration.

       The Capital Group decision does not appear to have intended to establish a new

substantive limitation on the scope of a forum selection provision. Nothing in the decision

suggests a new doctrinal requirement. The court rather seems to have broken its analysis

into three straightforward steps. First, it asked whether the forum selection provision was

valid. Second, it asked whether there was a basis to bind a non-signatory. Third, it asked

whether the claim at issue fell within the scope of the provision.

       The forum selection provision in the Capital Group case extended to “any action or

proceeding based upon or relating to this Agreement.” 2004 WL 2521295, at *1 n.6. When

the court reached the third element, it stated:

                                               40
       In order for Ritter to be bound by the terms of the forum selection clause, the
       claims asserted must arise from the [Agreement]. They clearly do. This is a
       suit to enforce the [Agreement] with respect to stock held in the Trust.
       Therefore, the claims clearly arise from Ritter’s standing relating to the
       [Agreement].

Id. at *7. Despite making passing mention of standing, the decision seems to have simply

analyzed whether the claims fell within the scope of the forum selection provision. The

two federal precedents cited in the Capital Group case likewise determined whether the

non-signatory was bound by the provision, then evaluated whether the claims fell within

the provision.7

       7
         The Capital Group case relied on Coastal Steel and Hadley v. Shaffer. Only the
Hadley decision used the language of standing, and the court did so when analyzing
whether the non-signatories previously relied on their standing as intended third-party
beneficiaries under a merger agreement. 2003 WL 21960406, at *5. After concluding that
the non-signatories were third-party beneficiaries, the court held that they were bound by
the forum selection provision in the merger agreement. Id. at *6. The Coastal Steel decision
similarly held that a non-signatory that was an intended third-party beneficiary of a contract
was bound by the full extent of a contractual forum selection provision in the contract. 709
F.2d at 202–03.

        If one digs further, the Hadley court cites a federal decision in which a party to a
joint venture sought to force the parent of its joint venture partner to arbitrate under the
theory that the parent was a third-party beneficiary of the joint venture agreement. The
court rejected this argument, stating: “Coastal Steel, its progeny and Delaware law make
clear that a third party beneficiary will only be bound by the terms of the underlying
contract where the claims asserted by that beneficiary arise from its third party beneficiary
status.” E.I. DuPont de Nemours & Co. v. Rhone Poulenc Fiber & Resin Intermediates,
S.A.S., 269 F.3d 187, 197 (3d Cir. 2001) (emphasis omitted). The decision only cited two
decisions to support this assertion, neither of which involved Delaware law and neither of
which seems directly on point. See id. (citing Indus. Elecs. Corp. v. iPower Distrib. Gp.,
Inc., 215 F.3d 677, 680 (7th Cir. 2000), and Spear, Leeds & Kellogg v. Cent. Life Assurance
Co., 85 F.3d 21, 28 (2d Cir. 1996)). The Industrial Electronics decision instead adhered to
the rule that when a third-party beneficiary invokes the benefits of a contract, it must accept
the burdens, including an arbitration provision. 215 F.3d at 680–81. The decision held that

                                              41
       The reference to standing in the Capital Group case, however, has caused other

Delaware decisions to attempt to give meaning to that term. In a footnote in Weygandt, this

court posited that the language of the Capital Group case meant that “the agreement

containing the forum selection clause must also be the agreement that gives rise to the

substantive claims brought by or against a non-signatory in order for the forum selection

clause to be enforceable against the non-signatory.” 2009 WL 1351808, at *4 n.15. This

decision has referred to this rule as the same-agreement rule.

       The Weygandt footnote was dictum. The third element of the Capital Group test

was not at issue in Weygandt because the parties agreed that it was met. Id. at *4.

       The fact that an observation is dictum does not mean that it is not persuasive. Here,

however, the provenance of the rule provides reason to question it. Recall that the

procedural posture of Weygandt involved a buyer bringing a counterclaim against the seller

under an asset purchase agreement and a third-party claim against the seller’s affiliate—

the Landlord—under the Lease. The forum selection provision appeared in the purchase

the claims did not fall within the scope of the provision because they arose under a different
agreement. Id. at 681. The Spear, Leeds & Kellogg decision likewise adhered to the rule
that when a third-party beneficiary invokes the benefits of a contract, it must accept the
burdens, including an arbitration provision. 85 F.3d at 26.

       The concept of standing under this line of authority thus seems tied to traditional
third-party beneficiary status. References to standing need not seep into other parts of the
analysis. Once a court determines that a forum selection provision binds a non-signatory,
the court should enforce the language of the provision.

                                             42
agreement, but the claim against the Landlord related to the Lease. It thus does not seem

likely that the claimant in Weygandt could have satisfied the same-agreement rule, because

the agreement that contained the forum selection provision did not give rise to the claim

against the Landlord. That said, it seems even less likely that the Weygandt court would

have reached a different result if the parties had not stipulated that the third element of the

Capital Group test was met. The court stressed the closely related nature of the purchase

agreement and the Lease, and the court relied heavily on policy rationales, including the

problem that unless the forum selection provision bound the Landlord, the Landlord

“would have the power to cause duplicative and inefficient litigation in multiple forums

and undermine the benefit of predictability that W & A’s controller, Weygandt, provided

to Gulfstream by agreeing to the Consent Provision in the Asset Purchase Agreement.” Id.

at *6. The reasoning of Weygandt thus suggests a more flexible approach to the third

element than the single-agreement rule would support.

       Subsequent cases have created solutions to work around the limitations of the same-

agreement rule. One line of authority, for example, extends the same-agreement rule to

claims and defenses that are “inextricably intertwined” with the agreement containing for

forum selection provision. McWane, Inc. v. Lanier, 2015 WL 399582, at *8 (Del. Ch. Jan.

30, 2015); see PPL Corp. v. Riverstone Hldgs. LLC, 2019 WL 5423306, at *7 (Del. Ch.

Oct. 23, 2019).

       The more serious problem with the same-agreement rule is that it overwrites the

forum selection provision that the parties drafted. That becomes evident when a forum

selection provision sweeps more broadly than claims that arise under the agreement

                                              43
containing the provision. Forum selection provisions often encompass claims that arise out

of or relate to an agreement, and like the Delaware Forum Provision, they may also

encompass claims arising out of or relating to other transaction documents or agreements.

The same-agreement rule limits the scope of these provisions so that they only apply to the

non-signatory for purposes of claims that arise under the agreement containing the

provision.

       That outcome runs contrary to the underlying principles of estoppel that lead to the

forum selection provision binding the non-signatory. When a non-signatory accepts a direct

benefit under an agreement, principles of equitable estoppel demand that the non-signatory

accept the burdens associated with that agreement, including a forum selection provision.

Yet under the single-agreement rule, the non-signatory need not accept the full extent of

those burdens. The non-signatory is obligated to accept the burdens of the forum selection

provision only to the extent that claims arise under the agreement containing the provision.

Principles of equitable estoppel should result in the non-signatory bearing all of the burdens

associated with the agreement, including the full scope of the forum selection provision.

       A similar problem arises when principles of promissory estoppel cause the forum

selection provision to bind a non-signatory. The foreseeability test recognizes that a

controller, such as a parent corporation, may enter into a transaction on behalf of itself and

its controlled affiliates. As part of the transaction, a controller can promise to centralize

litigation involving itself and its controlled affiliates in a particular forum. If a controller

enters into a primary agreement that contains a forum selection provision that extends, by

its terms, to closely related agreements, then the controller is promising to centralize

                                              44
litigation involving those agreements in the chosen forum. That is true even if (i) the

controller causes controlled affiliates to enter into the closely related agreements and (ii)

the controlled affiliates are not parties to the primary agreement containing the forum

selection provision. Using promissory estoppel to enforce the provision against the

controlled affiliates “promote[s] stable and dependable trade relations” by preventing the

controller from using a controlled affiliate to evade its promise. Weygandt, 2009 WL

1351808, at *5 (internal quotation marks omitted). The same-agreement rule, by contrast,

enables the controller to evade its promise, because for purposes of a non-signatory

controlled affiliate, the forum selection provision only reaches claims arising under the

agreement containing the provision.

       This case illustrates those difficulties. The plain language of the Delaware Forum

Provision extends to any claims that arise out of or relate to the Terpene Agreement. The

Purchase Agreement contains the Delaware Forum Provision, but the Purchase Agreement

does not give rise to the claims in the Texas Lawsuit. The Terpene Agreement gives rise to

some of the substantive claims in the Texas Lawsuit, and all of the claims in the Texas

Lawsuit relate to some degree to the Terpene Agreement, but the Terpene Agreement does

not contain the forum selection provision.

       As this decision has explained, principles of estoppel call for enforcing the Delaware

Forum Provision against Flotek Sub, and the case for invoking promissory estoppel is

particularly clear. Through the Delaware Forum Provision, Flotek Parent promised to

litigate all claims arising out of or relating to the Terpene Agreement in Delaware. Yet the

same-agreement rule would permit Flotek Parent to escape that promise and litigate only

                                             45
some of those claims in Delaware. Under the same-agreement rule, the Delaware Forum

Provision would extend to claims against ADM for tortious interference with the Terpene

Agreement, aiding and abetting a breach of fiduciary duty, and the like. But the Delaware

Forum Provision would not extend to the core claims under the Terpene Agreement itself,

such as Flotek Sub’s claim for breach of the Terpene Agreement or its request to rescind

the Terpene Agreement.

       At the time of contracting, it is hard to believe that the parties sought to achieve that

result. Instead, the plain language of the Purchase Agreement and the structure of the

Transaction show that ADM and Flotek Parent intended for the Delaware Forum Provision

to encompass all claims that arise under or relate to the Terpene Agreement, including

claims for breach of the Terpene Agreement. Only a party to the Terpene Agreement, such

as Flotek Sub or the Company, could assert a claim for breach of the Terpene Agreement.

ADM and Flotek Parent thus necessarily foresaw and intended that the Delaware Forum

Provision would encompass those claims, notwithstanding the same-agreement rule.

       Whether to apply the same-agreement rule ultimately comes down to a choice

among default rules, because parties always can contract for a different result. As a default,

the same-agreement rule presumes that when a controller enters into a primary agreement

that contains a forum selection provision encompassing claims that arise under or relate to

closely related agreements, the controller only intends for the forum selection provision (i)

to encompass claims that arise under or relate to the other closely related agreements to the

extent the claims are asserted against signatories to the primary agreement and (ii) does not

intend to bind the controller’s affiliates who are the actual parties to the closely related

                                              46
agreements. Parties can contract around the default rule and make the single forum

selection provision in the primary agreement enforceable against controlled affiliates only

if they ensure that every party to a subsidiary agreement is also a signatory to the primary

agreement, if only for purposes of the forum selection provision. The rule does not enable

a controller to agree to an overarching forum selection provision in a primary agreement

that binds its non-signatory affiliates for purposes of claims under closely related

agreements unless those affiliates are made parties to the agreement.

       Declining to follow the single-agreement rule presumes that when a controller enters

into a primary agreement that contains a forum selection provision that encompasses claims

that arise under or relate to other closely related agreements, the controller intends for the

forum selection provision (i) to encompass claims that arise under or relate to the other

closely related agreements, even if asserted by or against the controller’s affiliates and (ii)

to bind the controller’s affiliates who are parties to those agreements. To contract around

this result, parties can simply agree to a narrower forum selection provision in the primary

agreement, or they can include a specific forum selection provision in the closely related

agreement. This default rule enables parties to enter into overarching forum selection

provisions in a primary agreement without requiring that every controlled affiliate become

a party to that agreement.

       This decision adopts the latter approach. It better promotes freedom of contract by

enabling a controller to enter into an overarching forum selection provision. It also avoids

the problem of a court applying a default rule to overwrite agreed-upon language. It

promotes simpler forum selection constructs, because a provision in a primary agreement

                                              47
can extend to multiple agreements, avoiding the need for separate provisions in each

agreement or the potentially cumbersome solution of having every controlled affiliate

become a party to the primary agreement.

       This decision therefore declines to apply the same-agreement rule as an overlay that

limits the scope of the Delaware Forum Provision. Instead, this decision interprets the third

element of the Capital Group test as asking whether the claims at issue fall within the plain

language of the provision. This court already has conducted a claim-by-claim analysis of

the causes of action in the Texas Lawsuit to determine whether they fall within the

Delaware Forum Provision for purposes of an anti-suit injunction against Flotek Parent.

The plain language of the Delaware Forum Provision is the same. The claims are the same.

The result is the same. The Delaware Forum Provision binds Flotek Sub to the same degree

as Flotek Parent.

       The court emphasizes that it means no disrespect to the Texas court by issuing the

anti-suit injunction. The Texas court is certainly capable of adjudicating the issues raised

by this case. The Court of Chancery has a busy docket, and the judges of the court have no

desire to interfere with litigation that is legitimately proceeding elsewhere. Flotek Parent,

however, agreed to the Delaware Forum Provision on behalf of itself and Flotek Sub, and

it would be disrespectful to a court in a sister state to permit the parties to burden that court

with litigation involving claims that the parties promised to litigate in Delaware.

                                               48
                                III.     CONCLUSION

       The motion for an anti-suit injunction is granted in part. Flotek Parent and Flotek

Sub are enjoined from pursuing the third, fourth, fifth, eighth, and ninth causes of action in

the Texas Lawsuit against ADM and the Company. Otherwise, the motion for an anti-suit

injunction is denied.

                                             49