After a highly successful, productive and largely uncontroversial first 18 months, the burgeoning Texas Business Court recently faced its first constitutional challenge.

In Brown v. Exxon Mobil Corp., former Exxon executive Artis Brown — represented by prominent plaintiffs’ lawyer Tony Buzbee — asked the Business Court to declare itself unconstitutional. He took issue with the court’s (1) geographic scope and (2) method of judicial selection. But those complaints aren’t novel. They largely mirror arguments that were raised — and rejected — back in 2023 when the Legislature passed H.B. 19, which created the Business Court.

Those arguments were unlikely to gain traction in court. For one thing, the Business Court is not the proper forum to resolve them. The Texas Supreme Court has exclusive jurisdiction over constitutional challenges to the Business Court. On the merits, Brown’s arguments run headlong into the Texas Constitution and centuries of Texas Supreme Court precedent upholding the Legislature’s broad power to create statutory courts. One recent decision looms especially large: In re Dallas County, in which the Texas Supreme Court rejected a constitutional challenge to the new Fifteenth Court of Appeals.

Since 1891, the Supreme Court repeatedly has confirmed that the Legislature has broad authority to create and define the contours of specialty courts. There’s no reason to expect the current Supreme Court to treat the Business Court any differently.

The Constitutional Challenge

Exxon removed Brown’s suit from Harris County to the Business Court on internal-affairs and qualified-transaction grounds. Brown sought remand, and he also filed a motion “challenging the constitutionality of the Texas Business Court.” While the Business Court recently granted that remand, it did so strictly on statutory grounds, leaving the constitutional question unaddressed. The premise of his constitutional argument was that, although the Legislature created the Business Court as a statutory court, in substance it’s a district court, which means it must comply with the constitutional requirements that govern district courts. Brown took issue with two features of the Business Court in particular: (1) its statewide jurisdiction, which Brown argued is inconsistent with the requirement that the state be divided into judicial districts, and (2) its judges, which are appointed by the Governor with the advice and consent of the Senate, instead of being elected.

Brown’s argument — that the Business Court is a district court in disguise — isn’t novel. It was first raised by opponents to the Business Court (aided by then-UT Professor Stephen Vladeck) during the 88th legislative session in 2023. They contended that the Business Court was a de facto district court because it had overlapping jurisdiction with, and its judges had the same powers as, the district courts. On that view, the court couldn’t have statewide jurisdiction or appointed judges. The Legislature rejected those arguments, passing H.B. 19 with bipartisan support in both houses.

Brown’s motion picked up where the Business Court’s opponents left off — arguing that the Business Court is a district court for constitutional purposes because it “essentially functions” as one.

Analysis

The Business Court Is Not the Proper Forum for Brown’s Constitutional Challenge.

As a threshold matter, Brown pressed his arguments in the wrong forum. Like it did with the Fifteenth Court, the Legislature granted the Texas Supreme Court “exclusive and original jurisdiction” over any challenge to the constitutionality of the Business Court. This approach enhances stability and reduces uncertainty by empowering the Supreme Court to promptly — and definitively — resolve any constitutional challenges. Consistent with that framework, on May 29 the Business Court granted Brown’s motion to remand purely on statutory jurisdictional grounds. The court did not adjudicate Brown’s constitutional arguments.

The Constitutional Arguments Fail on the Merits.

Texas’s Tradition of Statutory Courts

Brown’s constitutional arguments overlook Texas’s long history of creating statutory courts with special powers, and the Legislature’s broad authority to create them. That legislative flexibility stems from the failure of the 1876 Texas Constitution’s “rigid judicial framework” for statutory courts, as the Court noted in In re Dallas County. In those days, the Legislature attempted to create specialty statutory courts but was rebuffed by the judiciary, which repeatedly blocked the new courts by reading the 1876 constitution narrowly. In direct response, Texans amended their constitution in 1891 to entrust the Legislature with tremendous authority over the creation and jurisdiction of state courts. The amendment empowered the Legislature to “establish such other courts as it may deem necessary, and prescribe the jurisdiction and organization thereof.”

In the decades that followed, the Legislature frequently exercised its new powers. And, beginning with its 1897 decision in Harris County v. Stewart, the Supreme Court repeatedly blessed these new courts — relying heavily on the 1891 constitutional amendment — which “place[d] the subject” of statutory courts at “the complete disposal of the legislature.”

Stewart confirmed the Legislature could give statutory courts concurrent jurisdiction with, and the same judicial powers as, district courts. Sixteen years later, in Carter v. Missouri, Kansas & Topeka Railway Co., the Court held that the Legislature’s “broad power” over the statutory courts encompassed not only the courts’ territorial jurisdiction but also the manner of judicial selection.

Through Stewart and Carter, the Supreme Court outlined three key principles governing statutory courts:

• Their jurisdiction can be concurrent with a district court’s.
• Their judges can be appointed instead of elected.
• Their geographic reach is limited only by the Legislature’s discretion.

In Jordan v. Crudgington, the Supreme Court reaffirmed each of those principles. That 1950 decision involved a constitutional challenge to Potter County’s Domestic Relations Court — a statutory court with appointed judges and overlapping jurisdiction with the district courts.

The Court expressly rejected the challenger’s statutory-court-in-name-only argument, holding that “the premise that the court created by this Act is a district court merely because it exercises some of the jurisdiction of the district courts” was “without merit.” Instead, the Court explained, to “strike down” a statutory court, there must be “some specific section of the Constitution which condemns it.”

The Business Court Is Not a District Court

Brown contends that the Business Court is “essentially” a district court because it has overlapping jurisdiction with district courts and its judges have the same powers as district judges. But the Supreme Court already rejected virtually identical arguments in Jordan. Having concurrent jurisdiction with — or similar powers to — a district court doesn’t transform a statutory court into a district court.

Brown relies on two cases holding statutory courts unconstitutional: Whitner v. Belknap and Reasonover v. Reasonover. But those cases both involve jurisdiction stripping — the practice of creating a statutory court with exclusive jurisdiction over certain cases by eliminating the district courts’ power to hear them. There’s no jurisdiction stripping here: the Business Court has concurrent jurisdiction with the district courts. And even if the Business Court did have exclusive jurisdiction, it still wouldn’t be an issue. As the Supreme Court explained in In re Dallas County, the 1985 constitutional amendments expressly authorize the Legislature to do what Whitner and Reasonover forbade.

The Business Court isn’t a district court. It’s a statutory court, with specific jurisdictional rules and judicial qualifications designed to aid the Texas judiciary and economy. Under longstanding constitutional tradition and Supreme Court precedent, it’s not transformed into a district court just because it has overlapping jurisdiction and authority.

District Court Rules Don’t Apply to the Business Court

Once Brown’s core thesis is defeated, his two specific objections — to the Business Court’s statewide jurisdiction and method of judicial selection — fall away. Carter establishes that the Legislature has wide latitude in setting the “territory within which” a statutory court “may exercise its authority.” And In re Dallas County makes clear that statewide jurisdiction would be permissible even if the Business Court were subject to the constitutional requirements governing district courts. The Business Court’s geographical reach is thus a nonissue.

Brown’s objection to the appointment (rather than election) of the Business Court judges fares no better. Carter blessed Governor-appointed judges presiding over statutory courts more than a century ago. There “could be no court organized without a judge,” the Court explained, so the power to create a statutory court and “prescribe its ‘jurisdiction and organization,’” necessarily includes the power to establish “the manner in which the officers shall be chosen.”

Conclusion

The Texas Constitution empowers the Legislature to create specialized courts designed to meet the state’s unique needs. Since the constitution was amended in 1891, the Texas Supreme Court has consistently confirmed that the Legislature has wide latitude to create and design statutory courts. The Business Court is the latest example in the Legislature’s long line of successful statutory-court innovations. It fits comfortably within the Legislature’s power, and it’s not a district court in name or in substance.

The two qualities of the Business Court Brown objects to — its statewide reach and method of judicial selection — are features, not bugs. They allow the Business Court to speak with a single, statewide voice, enhancing stability and predictability. And they ensure that its judges are the cream of the crop, with the business acumen and experience needed to efficiently and effectively adjudicate the state’s most complex commercial disputes.

Here, the Business Court didn’t reach the constitutional question, instead remanding on jurisdictional grounds. But if the question ever reaches the Texas Supreme Court, it’s highly unlikely that we’ll see a departure from the Court’s century-long line of decisions consistently blessing the constitutionality of statutory courts just like this one.

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Contracts.

Background. The Dallas Mavericks’ ownership entities (plaintiffs Dallas Sports Group and Radical Arena) sought to redeem the Dallas Stars’ ownership interests in the Center Operating Company (COC) and its general partner GP – the entities that operate the American Airlines Center area. In October 2024, the Mavericks delivered a redemption letter and $110 cash, triggering what they argued was a “Relocation Event” under the Mavericks’ and Stars’ partnership agreements, based on the Stars’ failure to maintain their principal corporate and executive offices in the City of Dallas. The redemption letter named “DSE Hockey Club, L.P.” (Hockey Club) in the address block, rather than Dallas Sports & Entertainment, L.P. (DSELP), which turned out to the actual contract party holding the Stars’ interest in the American Airlines Center. The Stars revealed this distinction only on January 25, 2026 – months into the litigation – despite having consistently represented Hockey Club as the owner in their pleadings and sworn declarations.

At the parties’ request, this opinion further explains the court’s May 5, 2026 orders deciding that (i) the Maverick’s redemption letter and cash tender method was also effective as to DSELP; (ii) the court’s April 2, 2026 summary judgment rulings negated the Stars’ declaratory judgment counterclaim and those claims are dismissed; and (iii) the Stars’ 2011 bankruptcy was not a  defense to the Mavericks’ claims.

Holdings:

1. Under International Bankers Life Co. v. Holloway, 368 S.W.2d 567 (Tex. 1963), actual notice to DSELP’s officers and agents – including its owner, CEO, and CFO – was actual notice to DSELP); the Mavericks’ redemption method was effective to DSELP because the letter and cash “got to the right people, Texas elevates substance over form, and DSELP was in privity with Hockey Club and was not misled or prejudiced.” The court rejects the Stars’ due process objection, finding DSELP had known of the dispute from the outset, shared identical interests and counsel with Hockey Club, and failed to seek a continuance or assert unique defenses after being joined.
2. On the counterclaim issue, the court dismissed the Stars’ declaratory judgment counterclaim as a mirror image of issues already resolved in the Mavericks’ favor in the court’s April 2, 2026 order, rendering it moot.
3.  The Stars’ 2011 bankruptcy did not bar the Mavericks’ claims on res judicata grounds; the Stars assumed their Location Commitment and Relocation Event terms post-bankruptcy; these terms created a condition subsequent that applied post-bankruptcy. Because the Stars’ post-bankruptcy conduct triggered that condition, the Mavericks could exercise their redemptions rights; the  court further notes that the defense was waived by not being raised in response to the Mavericks’ earlier summary judgment motion.

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• Missouri:  White Collar Crime & Government Investigations
• Litigation: General Commercial

Chambers is widely recognized as one of the most respected research and analytics organizations in the legal industry, spotlighting the nation’s leading law firms and attorneys. Likewise, its USA Guide is esteemed for its rigorous, independent assessment of top legal talent and practices across the country. In addition to Dowd Bennett’s recognition, five of the firm’s attorneys also earned individual honors:

• Jim Bennett, Ed Dowd and Michelle Nasser are ranked individually in the Band 1 category for Litigation: White Collar Crime & Government Investigations.

A Band 1 ranking is the highest achievable tier for both law firms and individual attorneys in a specific practice area and jurisdiction.  It demonstrates “market-leading expertise, outstanding client service and distinguished professional reputation.”

• Jim Bennett is also ranked as a Band 1 attorney is the category of Litigation: General Commercial
• Partner Ben Barnes, based in the Dallas office, is also ranked by Chambers for the first time in the category of Litigation: General Commercial.
• Jim Martin, who is Of Counsel, retained his rank of Senior Statespeople and has been a ranked attorney by Chambers for 20 years.

“We are honored, both as a firm and as individuals, to be recognized by Chambers, an organization known for its rigorous vetting process,” said founding partner Ed Dowd. “At Dowd Bennett, our clients will always remain our highest priority, but it is deeply gratifying to have our work acknowledged by such a respected institution.”

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Jurisdiction – Sec. 25A.004(b) and (d).

Background.  Brown, a 29-year Exxon employee serving as Vice President of Basestocks & Waxes, had his employment end on July 25, 2025. Exxon contends Brown resigned after testing positive for THC-metabolites under a random drug screen pursuant to the  company’s Alcohol and Drug Use Policy. Brown contends he was unlawfully terminated because of his race, arguing the Drug Use Policy did not cover THC-metabolites and that, in any event, similarly-situated non-Black executives who violated comparable policies were treated more favorably. Upon termination, Brown forfeited about $5 million in previously awarded incentive compensation, including unvested Restricted Stock Units (RSUs). After exhausting administrative remedies with the Texas Workforce Commission, Brown filed suit in the 11th District Court of Harris County under Section 21.051 of the Texas Commission on Human Rights Act (TCHRA). Exxon removed the case to the Business Court, and Brown moves to remand. The motion to remand is granted.

Issue Presented: Whether the Business Court has subject matter jurisdiction under either (1) Texas Government Code Sec. 25A.004(b)(2), as an action “regarding the governance, governing documents, or internal affairs of an organization,” or (2) Sec. 25A.004(d)(1), as an action “arising out of a qualified transaction” involving at least $5 million in consideration.

1. On the “internal affairs” question, the court applies the cannon of noscitur a sociis (a word is known by the company it keeps), reading “internal affairs” in context with its statutory neighbors – “governance” and “governing documents” – to conclude the term encompasses entity governance questions, not general employment disputes. The court rejects Exxon’s three arguments: that CEO involvement in the termination triggered jurisdiction; that Brown’s officer status triggered it; and that the forfeited RSUs constituted “ownership interests.” As to the RSUs, the court found the core dispute was Exxon’s allegedly discriminatory decision to forfeit them, not the ownership interests themselves.
2.  On the “qualified transaction” question, the court held the RSUs and incentive awards were not the “but-for” cause of the litigation – they were one of several damages categories flowing from the alleged racial discrimination, not the transaction out of which the claim arose. Brown’s claim under Section 21.051 of the TCHRA does not “arise out of” a qualified transaction, and the court does not have jurisdiction over this claim under Sec. 25A.004(d).
3. Remanded to the District Court of Harris County.

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Corporate Governance/Contracts.

Background. Gage Western LLC was governed by a Company Agreement establishing a multi-class membership structure. Energy Founders Fund (Energy) held majority Class A interests, while Phillip and Cris Daskevich held minority Class B interests. The Company Agreement’s drag-along provision permitted a majority member to compel minority participation in a “Controlling Sale,” defined as a bona fide sale to persons who are not affiliates of the dragging members.

In mid-2024, Energy negotiated to sell its interests to PJC Investments, LLC. PJC formed GW Allen, LLC as a wholly-owned special-purpose acquisition vehicle, with PJC’s Chief Operating Officers serving as GW Allen’s sole manager. As part of the broader deal, Energy and PJC negotiated a post-closing governance framework – the A&R Agreement – that would grant Energy board seats, quorum protections, and veto rights in GW Allen effective after closing. Energy issued its Drag-Along Notice on November 18, 2024, the same day the transaction closed with PJC. The Daskeviches refused to execute closing documents, contesting whether GW Allen qualified as a non-affiliate purchaser. The matter comes before the court on cross-motions for partial summary judgment. Energy’s motion is granted, and Phillip Daskevich’s motion is denied.

Held: The Issue is whether GW Allen was an “affiliate” of Energy under the Company Agreement at the time of the transaction, which would have invalidated the drag-along.

1. The “Affiliate” designation in the Company Agreement required present, existing control – the Agreement is framed in the present tense and is grounded in actual “possession” of governance power. Before closing, PJC owned GW Allen entirely, and its Chief Operating Officer managed it exclusively; Energy held no equity, voting rights, managerial authority, or contractual right to direct GW Allen’s affairs. While Energy negotiated for substantial post-closing rights, it did not possess those rights until the transaction closed.
2. The court rejects Daskevich’s retroactivity theory – that post-closing rights under the A&R Agreement tainted GW’s pre-closing status – as both textually unsupported and commercially unworkable. The  court also noted that the active pre-closing negotiations confirmed Energy was bargaining for rights it did not yet possess; Daskevich’s reading would cast doubt on virtually any drag-along involving a newly-formed acquisition vehicle; a disruptive result the parties plainly did not intend and the Company Agreement’s text does not support.

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Contracts.

Background. DK Trading & Supply (Delek) and Wink to Webster Pipeline (Wink) entered into two 2021 agreements governing crude-oil storage at a terminal in Midland County and pipeline transportation from that terminal. Disputes arose over whether Delek had exclusive use of designated storage tanks and how deficiency payments were to be calculated under a “ship or pay” clause. The parties filed cross-motions for partial summary judgment. Both parties agree the contracts are unambiguous.

Held:

1. Regarding the Terminal Agreement – Exclusive Tank Use Issue. The court holds that the Terminal Agreement grants Delek exclusive use of two specific tanks rather than a mere volumetric entitlement to fungible storage space anywhere in the Midland facility. The court reasons that treating Storage Capacity as comprising tangible facilities – evidenced by provisions for construction costs, segregated maintenance expenses, the “Delek Tanks Only” cost schedule, and clean-out obligations – gave the exclusivity guarantee meaningful content. Wink’s contrary reading would render both the exclusivity language and the tank-substitution mechanism surplusage.
2. Regarding the Transportation Agreement – Deficiency Payment Calculation.  The court construes the “ship or pay” clause to require that all barrels actually shipped during a “True-Up Period” reduce  Delek’s volume shortfall, regardless of whether those shipments were paid using Deficiency Credits earned in prior periods. The plain definition of “Actual Shipments” – all barrels physically moved on the pipeline – compels this decision, and the differing time periods for calculating Deficiency Payments (multi-month) versus Credits (monthly) makes Wink’s contrary construction mathematically unworkable.
3. Notice as Condition Precedent.  The court grants summary judgment for Wink on six older invoices, holding that Section 8.02 of the parties’ Agreement, requiring  written dispute notice by the invoice due date, creates a condition precedent to any remedy and not merely a covenant. Delek’s first notice, sent in August 2025, was untimely as to invoices dating to 2022-2024. The court rejects Delek’s arguments that the clause unlawfully shortened the limitations period or was excused by Wink’s material breach, finding  neither a limitations issue (the clause governs notice, not filing suit) nor adequate evidentiary support for the materiality factors.

Disposition: Delek’s motion for partial summary judgment is granted on tank exclusivity and deficiency payment calculation and is denied as to the Event of Default clause. Wink’s motion is granted as to six time-barred invoices. In sum: (1) The Terminal Service Agreement granted Delek exclusive use of two tanks at Midland for the storage of up to 566,000 barrels of crude; (2) The Terminal Agreement does not permit Wink to unilaterally place crude oil meeting the quality specifications set forth int the Pipeline Tariff in tanks designated for Delek; (3) Under the Amended and Restated Transportation Services Agreement, Wink must calculate the Deficiency Payment for each “True-Up Period” such that the number of deficient barrels under Section 7.03(a)(i) is computed in a manner that accounts for every barrel of product actually shipped on the pipeline during the True-Up Period; and (4) Delek’s claims for breach of contract with respect to the six old invoices are dismissed with prejudice.

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Jurisdiction.

Background.

Clean-Co sued Enterprise in state district court to recover on a single unpaid invoice for industrial cleaning services performed in July-August 2025 under a time-and-materials purchase order. The invoice, originally $154,360 increased to $688,141 due to changes in the scope of the work. Enterprise removed the case to the Business Court, asserting qualified transaction jurisdiction and filing a counterclaim for approximately $8 million for boiler damages allegedly caused by Clean-Co’s deficient work. Clean-Co moves to remand the matter to the district court, challenging the court’s jurisdiction.

The issue in the case is whether the dispute arose from a “qualified transaction” under Tex. Gov’t Code Sec. 25A-004(d)(1) – specifically, whether the single purchase order at issue, considered alongside the parties’ 2003 Master Service Agreement (MSA) and over two decades of sporadic spot contracts between the parties, constituted “a transaction, or series of related transactions” with aggregate consideration exceeding $5 million under Sec. 25A.001(14). The court holds it lacks jurisdiction and remands the matter to district court.

Held:

1.  The MSA standing alone could not qualify because, at execution, no consideration was paid or promised – it was merely an umbrella framework for future work.
2.   The court sustains Clean-Co’s hearsay objections to admission of Enterprise’s Oracle payment records, by which Enterprise sought to establish that it had paid Clean-Co $7.88 million since 2003.   The court found Enterprise has not established that the Oracle platform and the underlying invoices are non-hearsay business records. This eliminated the only evidence purporting to show that the parties transacted more than $5 million under the MSA and that those services were “related.”
3. But that does not decide the matter as Enterprise’s pleading squarely recites the existence of a series of related transactions in an amount exceeding $5 million. However, even construing the pleadings liberally in favor of jurisdiction, what appears on the record is a series of transactions between Enterprise (or its affiliates) and Clean-Co for differing scopes of specialized cleaning that took place over a period of more than 20 years in a variety of geographic areas. But only the purchase order at issue supplies the basis for any claim or counter-claim.  The other orders are not in controversy; Enterprise does not contend that Clean-Co performed these historical purchase orders deficiently, nor does Clean-Co seek recovery under them. These other transaction are historical background and evidence of the parties’ long-standing relationship, but they have nothing to do with the subject matter of this suit.  Thus, the court lacks jurisdiction over the case under Government Code Sec. 25A.004(d)(1) because the MSA and the invoice at issue, taken together, do not constitute “a transaction, or a series of related transactions” that exceeds $5 million in consideration.  The motion for remand is granted.

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Rule 91a Motions to Dismiss/Texas Uniform Trade Secrets Act.

Background. 

Plaintiffs Unimacts Global and two Zetwork entities (Unimacts) sued Ayr Energy, Inc. (Ayr), alleging three former Unimacts employees exploited their positions to establish and promote Ayr as a competing business while still employed by Unimacts. The alleged misconduct included misappropriating Unimacts’ trade secrets and breach of fiduciary duty by soliciting Unimacts’ customers and investors on Ayr’s behalf and using its corporate resources – company devices, email accounts, and Microsoft Teams – to promote Ayr’s interest. Ayr filed this Rule 91a motion to dismiss, contending Unimacts’ claims are preempted by the Texas Uniform Trade Secrets Act (TUTSA) and that Unimacts had failed to plead sufficient facts showing Ayr was aware of any breach of fiduciary duty.

Held:

1. Ayr’s argument that Unimacts’ claim for knowing participation in breach of fiduciary duty is premised on the same facts as the alleged misappropriation of Unimacts’ trade secrets and is therefor preempted by TUTSA.  TUTSA does preempt common law theories premised on the same facts as a misappropriation of trade secrets claim, however, under TUTSA, preemption of trade secrets does not affect remedies which are not based upon misappropriation of trade secrets. Here, Unimacts’ allegations extended beyond trade secrets claims to encompass unauthorized use of corporate resources and active competition during employment; this conduct is independently actionable under ScaleFactor, Inc. v. Process Pro Consulting, LLC, 394 F. Supp. 680, 686 (W.D. Tex. 2019). Accordingly, those non-overlapping claims survive TUTSA preemption.
2.  With respect to Ayr’s argument that Unimacts failed to plead sufficient facts to show Ayr was aware of any breach of fiduciary duty, Unimacts expressly pleaded that the employees  were acting on behalf of Ayr when they solicited customers, sought investors, and used Unimacts’ resources to establish Ayr’s competing business. An agent’s knowledge acquired within the scope of the agent’s authority is imputed to the principal.   Taking Unimacts’ allegations as true, and applying settled Texas law, Ayr may be charged with knowledge its agents acquired while conducting Ayr’s business.  Thus, Unimacts adequately pled the knowledge element of the knowing-participation claim.
3. The court cannot conclude that Unimacts’ cause of action has no basis in law or fact, and the Rule 91a motion to dismiss is denied.

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Contracts.

Background. In 2022, Cobalt Falcon sold AXS assets related to the management of an Exchange-Traded Fund (ETF) under an agreement requiring monthly payment from AXS “in perpetuity (unless otherwise agreed).” After AXS closed the Fund, it stopped making payments. Cobalt sued, claiming “in perpetuity” required continued payments whether or not the fund was still in existence. This is a memorandum opinion and order construing the parties’ sales agreement under TRCP 166(g).

Held: Applying Delaware law, the court holds that “in perpetuity” is unambiguous and means just what is says: forever or without end.

Under Delaware law, this plain meaning controls unless there is an ambiguity. Deviation from the plain meaning requires two or more reasonable interpretations which would thereby create ambiguity. Cobalt’s interpretation is reasonable and the phrase can only be given effect under Cobalt’s interpretation. Giving the phrase its plain meaning does not render other provisions of the contract meaningless; nor does it lead to an absurd result. As to AXS’s “absurdity” argument,  AXS controlled whether the Fund remained open, and giving AXS post-contract power over its own payment obligations would itself produce an absurd result; taking AXS’s position to its logical conclusion would require the court to find that Cobalt agreed to relinquish control over the Fund (and the resulting revenue stream) in exchange for payments that would be made only so long as AXS elected to keep the Fund open and continue payments; reading the agreement to give AXS unilateral, post-contract control over the consideration to be paid presents an absurd outcome, rendering AXS’s interpretation unreasonable. Because there are not two or more reasonable interpretations of the “in perpetuity” language in the sales agreement, there is no ambiguity,  and its plain meaning prevails. The court cannot rewrite the agreement and the consideration obligations simply because AXS may have been mistaken as to their duration or otherwise regrets the bargain.

Following Fund closure, the purchase consideration formula  provision in the sales agreement yields a fixed monthly payment to Cobalt of $74,062.

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Contracts.

This a dispute over interpretation of an asset-purchase agreement and whether defendants, as sellers, are obligated to reimburse plaintiffs, the purchasers, for costs incurred defending and resolving certain erosion damage and failure to maintain infrastructure claims against current and former owners of the subject pipeline assets. After examining the relevant purchase agreement and related documents, the court concludes the purchase agreement unambiguously limits plaintiffs’ remedies to the indemnification provisions of the agreement and that those indemnification obligations expired before plaintiffs asserted the claims at issue.

Plaintiffs’ interpretation of the provisions would essentially entitled them to reimbursement in perpetuity, and such an interpretation would render the exclusive remedy and survival aspects of the indemnification superfluous; nor is the construction a reasonable alternative interpretation sufficient to support a finding of ambiguity which would preclude a grant of defendants’ motion for summary judgment. In sum, under the unambiguous terms of the purchase agreement, the negotiated indemnity and exclusive remedy provisions, coupled with the mandatory claim notice deadline tied to the requisite survival period, plaintiffs’ claims are barred. Defendants’ motion for summary judgment is granted.

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