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Yetter Coleman Wins Take-Nothing Defense Judgment On Behalf of Apache In $3 Billion Lease and Payment Dispute With Apollo Exploration, Cogent Exploration, and SellMoco

On August 30, 2019, Yetter Coleman and its co-counsel, Stephen Crain of Bracewell LLP and Harper Estes of Lynch Chappell & Alsup, LLP, secured a take-nothing judgment for Apache Corporation. The final judgment, secured after five years of litigation of a dispute in which the plaintiffs sought damages in excess of $1 billion, also includes a $4.8 million attorneys’ fee award for Apache.

In April 2014,  Apache was sued by working interest owners in the 385th District Court in Midland, Texas, for failure to comply with lease reassignment clauses in a purchase and sale agreement. For the next several years, the plaintiffs asserted theory after theory of liability, ultimately alleging both contract and fraud claims and seeking damages over $1 billion in damages (plus $2 billion in punitive damages). During that time, Apache took extensive discovery from plaintiffs and various non-parties.

In the lead up to trial, Yetter Coleman and its co-counsel filed several motions for summary judgment on key contract construction issues, as well as a motion to exclude plaintiffs’ well-known damages expert. After lengthy hearings, including a Daubert hearing at which Yetter Coleman lawyers cross-examined plaintiffs’ damages expert, the court granted Apache’s motions, construed the contracts in Apache’s favor, and excluded plaintiffs’ damages expert. Trial was delayed to allow plaintiffs to regroup.

And regroup they did. Plaintiffs hired a new damages expert who opined to an equally astounding $200 million in damages. As it turned out, plaintiffs had changed their claims again and asked the new damages expert to make assumptions that were contrary to the contracts and to testimony by plaintiffs themselves. Again, Apache moved for summary judgment on the new claims and challenged the expert testimony, and ultimately convinced the trial judge yet again to whittle down the major claims. Plaintiffs tried to take an early appeal, to no avail.

In early 2019, and on the eve of another trial date, plaintiffs yet again amended their expert disclosures to assert hundreds of millions of dollars in damages. Apache objected, again, and after contentious hearings, the trial judge ruled that none of plaintiffs’ damages experts were entitled to testify at trial. At that point, both sides agreed that Apache would move for a no-evidence summary judgment based on the absence of damages. Apache filed its motion that afternoon and the court granted it a few days later.  Subsequently, Apache moved for an award of $4.8 million in legal fees, and on August 30, the Court signed a final, take-nothing judgment with an award of $4.8 million in legal fees to Apache.

Our trial team includes Tim McConn, Reagan Simpson, Doug Griffith, and Robert Woods. The case is No. CV50538 Apollo Exploration, Cogent Exploration, Ltd. Co., and Sellmoco, LLC v. Apache Corporation.