Jury Awards Pickens, Mesa $146M in Oil Lease Lawsuit
By Brendan Briggs
After three hours of deliberations, a jury comprised of local residents decided to award T. Boone Pickens and his Mesa Petroleum Corp. $146 million in an oilfield lawsuit heard in the 143rd District Court of Texas.
Jurors endured nearly three weeks of testimony regarding a contract dispute between Pickens' firm, Mesa Petroleum, and co-defendants: J. Cleo Thompson, Baytech, Delaware Basin Resources, and Patriot Resources. The $146 million verdict returned on Wednesday was just under half the $300 million Pickens and Mesa had sought in their lawsuit.
The defendants asserted that Mesa had relinquished its rights in the deal over the phone, in a conversation between Pickens and Thompson back in 2009 on leased land in southeastern Reeves and northwestern Pecos counties. Mesa's initial investment was about $2oo,ooo, while the company in its suit said the disputed leases could now be worth up to $1.3 billion.
Mesa's lawyers repeatedly pointed out to the jury that both the pivotal documents in the case could only be amended in writing, thus any verbal opting out would be non-binding and rather hard to prove as James Cleo Thompson died in 2010.
We're grateful for the time and attention this jury committed to this case," Pickens said in an email conversation on Monday, adding "we maintained from the beginning that out oil and gas interests were taken illegally."
In its decision, the jury divided the judgment unequally between the defendants with its award of $130 million plus legal fees against Baytech and $12 million plus legal fees awarded against J. Cleo Thompson.
Speaking on behalf of J. Cleo, Chief Financial Officer Paul Rudinicki said the company was pleased that the jury had rejected the initial claims, "awarding a fraction of what Mr. Pickens and his lawyers originally sought."
Lawyers for the Baytech defendants expressed their disappointment at the verdict, and added that they will be consulting their clients after a careful review the record to determine the best course of action.
If the case appealed it will most likely end up in the Eighth Court of Appeals of Texas located in El Paso.
During closing statements, plaintiff attorney Mike Lynn told the jury that their decision was not only important for Pickens himself, but also would affect the willingness of companies to do business in Reeves County.
"Investors come when they can rely on agreements," Lynn told them last Tuesday.
He went on to remind the jury that the defendants had repeatedly ''crawfished" by providing elusive answers to straightforward questions, adding they had acted like squids, squilting ink to muddy the waters.
In contrast, Pickens testified plainly even under great pressure from the defendants' lawyers, Lynn said. Local attorney Bill Weinacht also addressed the jury, reminding them "we are here to make people honor their contracts. It is your decision, is this building a house of bricks or a house of justice."
"You can go home and tell your family and friends that you helped some people weasel out a deal they made, or you can say you delivered justice," Weinacht said.
In his email, Pickens reiterated that "the Red Bull is part of what is now one of the biggest resource plays in the world, and we are hopeful that the jury's decision here will mean that the long history of fair dealings in the oil industry continues. This case emphasizes and validates important legal rights, and we are proud to have been a part of it.''