Texas court orders Eagle Ford rights, proceeds returned to Longview Energy

Gardere Wynne Sewell LLP

In a court judgment believed to be the largest ever involving the Eagle Ford Shale, Judge Amado Abascal of the 365th Judicial District Court in Zavala County has assigned all rights to approximately 46,000 leasehold acres, valued at more than $500 million, to Dallas-based Longview Energy Company.

In June, jurors in Longview Energy Company v. The Huff Energy Fund L.P., WRH Energy Partners, LLC, Riley-Huff Energy Group LLC, William R. “Bill” Huff, and Rick D’Angelo found in favor of Longview Energy based on breach of fiduciary duty, and aiding and abetting claims.

The jury found that Longview Energy directors Bill Huff and Rick D’Angelo used The Huff Energy Fund portfolio company Riley-Huff Energy Group to breach their fiduciary duty in order to covertly secure 46,130 Eagle Ford leasehold acres that were being explored by Longview Energy.

“This case reaffirms the importance of corporate fidelity and the consequences of straying from your responsibilities,” says Craig B. Florence of Gardere Wynne Sewell LLP, who represented Longview Energy at trial along with Gardere partner Randy D. Gordon, and Mikal Watts and Frank Guerra of Watts Guerra Craft LLP. “As the court has affirmed, once you commit to a board and its shareholders, your loyalty cannot be compromised.”

According to court records, Huff and D’Angelo encouraged Longview Energy to explore an investment in the Eagle Ford Shale. Shortly before the Longview Energy board was to make its final vote on the investment, Huff and D’Angelo directed The Huff Energy Fund portfolio company Riley-Huff Energy Group to begin purchasing the same leases. The Huff Energy Fund owns approximately 40% of Longview Energy and approximately 99% of Riley-Huff Energy Group.

The judgment orders Riley-Huff Energy Group to transfer title to the Eagle Ford leased acres, and all related wells and production facilities to Longview Energy within 30 days. Additionally, Huff, D’Angelo, The Huff Energy Fund, WRH Energy Partners, and Riley-Huff Energy Group are required to pay Longview Energy $95.5 million for past revenues, as well as all production proceeds earned from the leasehold acres since the June 2 jury verdict, an estimated $5 million per month. The judgment also carries an award of 5% percent annual post-judgment interest.

Related Articles

NSLP makes second acquisition in Southern Dome field

02/06/2014 New Source Energy Partners LP has acquired working interests in 23 producing wells and related undeveloped leasehold rights from CEU Paradigm LLC, an affiliate of Exelon Corp. The properties are lo...

Post Oak closes second fund with $600M in commitments

02/05/2014

Post Oak Energy Capital has closed its second fund with commitments totaling $600 million.

Regency acquires Hoover Energy midstream business

02/04/2014

Regency Energy Partners LP has closed on its acquisition of the midstream business of Hoover Energy Partners LP for a combination of cash and Regency common units. 

Kinder Morgan secures additional throughput commitment for condensate processing facility expansion

03/28/2013 Kinder Morgan Energy Partners LP has entered into a long-term, fee-based agreement with BP North America to underwrite an additional 50,000 barrels per day of throughput capacity at the petroleum c...

Energy Transfer sells interest in ETP Holdco to simplify structure

03/21/2013

Energy Transfer Equity LP will sell its interest in ETP Holdco Corp. to Energy Transfer Partners LP for $3.75 billion in cash and ETP common units.

More Oil & Gas Financial Articles

NSLP makes second acquisition in Southern Dome field

Thu, Feb 6, 2014

New Source Energy Partners LP has acquired working interests in 23 producing wells and related undeveloped leasehold rights from CEU Paradigm LLC, an affiliate of Exelon Corp. The properties are located in the Southern Dome field in Oklahoma County, Oklahoma.

Post Oak closes second fund with $600M in commitments

Wed, Feb 5, 2014

Post Oak Energy Capital has closed its second fund with commitments totaling $600 million.

Regency acquires Hoover Energy midstream business

Tue, Feb 4, 2014

Regency Energy Partners LP has closed on its acquisition of the midstream business of Hoover Energy Partners LP for a combination of cash and Regency common units. 

Kinder Morgan secures additional throughput commitment for condensate processing facility expansion

Thu, Mar 28, 2013

Kinder Morgan Energy Partners LP has entered into a long-term, fee-based agreement with BP North America to underwrite an additional 50,000 barrels per day of throughput capacity at the petroleum condensate processing facility Kinder Morgan is constructing near its Galena Park terminal on the Houston Ship Channel.

Energy Transfer sells interest in ETP Holdco to simplify structure

Thu, Mar 21, 2013

Energy Transfer Equity LP will sell its interest in ETP Holdco Corp. to Energy Transfer Partners LP for $3.75 billion in cash and ETP common units.

Most Popular

Oil & Gas Jobs

Search More Job Listings >>
Subscribe to OGFJ