A recent Hill Country easement dispute was considered by the San Antonio Court of Appeals in Luckenbach Ranch, LLC v. Bowling.  [Read Opinion here.]

Photo by Melina Dominic Streit 

Background

Wendy Williams owned 62-acres of land in Fredericksburg, TX.  Wendy offered to sell her brother, Troy, and sister-in-law, Kim, 15.5 acres of her land.  Kim, who was a realtor, prepared a purchase agreement for the 15.5 acres that Wendy signed.  The agreement was amended to account for renumbering of the address of the parcel Troy and Kim would purchase and that which Wendy would keep. Before the closing, Troy and Kim’s lender required a written easement.  Kim filled out a template document, “Private Road Easement” that she and Troy signed and sent to Wendy who e-signed.  The document provided that Wendy agreed to grant access and maintain road entry for easement purposes being more particularly described and located as: Gated Entry-5412 Ranch Road 1376 Fredericksburg, TX.” This document was filed in the deed records.

In May 2021, Wendy sold the remaining 46.5 acres to Luckenbach Ranch, LLC (“Luckenbach”).  The deed for this transaction excluded the Private Road Maintenance Agreement and Access Easement executed by Wendy, Troy, and Kim.  In November 2021, Luckenbach sold 6 acres of its property to Firefly Land Partners, LLC (“Firefly”).  That deed specifically provided for “rights of adjoining property owner(s) to use the gravel roads and asphalt road traversing subject property” and shown on a 2021 survey.

Lawsuit

Troy and Kim filed suit for a declaratory judgment and injunctive relief against Luckenbach and Firefly.  Troy and Kim sought summary judgment on their claims of express easement and easement by estoppel.  The trial court granted the motion. Several months later, a trial was held where Troy and Kim claimed that Luckenbach and Firefly closed the easement’s entrance with TxDOT and reopened another entrance to the north.  Troy and Kim sought a final judgment to delineate the path of the road easement through an attachment to the final judgment.  Luckenbach stipulated that the easement had been moved, but Firefly objected to the map attachment as never having been admitted into evidence.  The trial court signed a final judgment finding that Troy and Kim had a “permanent easement across” Luckenbach and Firefly’s property.  Luckenbach and Firefly appealed.

San Antonio Court of Appeals Opinion

The San Antonio Court of Appeals affirmed.  [Read Opinion here.]

Statute of Frauds

First, the appellants argued that the Private Road Maintenance Agreement violates the statute of frauds in relation to the express easement claim because it fails to contain an adequate description of the location, width, scope, “means or data,” or beginning or ending points of the easement.  The court rejected this argument pointing to several other Texas appellate court decisions holding that “an exact designation of location is unnecessary, as long as the tract of land that will be burdened by the easement is sufficiently identified.”  This is in line with Texas Supreme Court precedent providing that “if enough appears in the description so that a person familiar with the area can locate the premises with reasonable certainty, it is sufficient to satisfy the Statute of Frauds.” Here, there was no argument that the agreement language “5412 Ranch Road 1376, Fredericksburg, TX” was any other tract of land besides that retained by Williams and later conveyed to Luckenbach and Firefly.  Thus, the court overruled the appellants’ argument that the agreement violated the Statute of Frauds.

Scope of the Agreement

Appellants next argue that the phrases “road entry,” “gated entry,” and “access and maintenance” in the agreement cannot support an express easement because these terms do not express an intent by Wendy to grant anything more than that.  The court looked at the ordinary meanings of the words road, entry, gated, access, and maintenance and disagreed with the appellants.  Even liberally construing their arguments, the use of the language “Grantor agrees to grant access and maintain road entry for easement purposes” was sufficient to serve as the granting of a road easement.

Relocation of Easement Entrance

The court rejected the Appellants’ argument that summary judgment was improper on the relocation of the easement because a question of fact existed because that misconstrued the court’s ruling.  The trial court did not grant summary judgment on the relocation issue–it granted a final judgment after a bench trial. They framed this issue under an improper standard of review, and it was rejected by the court.

Easement by Estoppel

Because the court found an express easement existed, it was not necessary to reach whether an easement by estoppel also existed.

The court affirmed the judgment of the trial court.

As of the date of this post, no Petition of Review has been filed with the Texas Supreme Court.

Key Takeaways

This case highlights a number of issues important for Texas landowners to understand.

First, it is critical to have legal access to property.  Here, before Troy and Kim were able to obtain a loan to purchase the property, their lender required a written access easement agreement.  Financial institutions will not lend money for property that does not have legal access.  This can greatly impact the marketability of one’s land.

Second, when land is divided up into smaller parcels, ensuring that easements are obtained, written, and properly recorded is a key step in ensuring legal access for the future.  This is a daily occurrence across Texas, and it can be easy to overlook the importance of obtaining written easements when subdividing land.

Third, a handshake agreement or family understanding regarding property access is not binding on future owners.  Here, the initial severance of land was between a sister and brother.  It may well have been at that stage that Wendy would have allowed Troy and Kim to cross her land to reach their property without a written agreement.  Oftentimes, problems arise down the road when the land is no longer owned by the friendly neighbor or family member.  At that point, having legal access that is recorded in the deed records becomes extremely important in order to protect your property and your rights to access.

Fourth, here, the parties utilized a simple, fill in the blank template agreement. While the court ultimately upheld that template agreement, it probably was not the ideal language to use for an easement in this case.  Instead, having a specific document written up that addressed the specific land, parties, and issues in this case might have been preferable.  Including details such as the location, width, and allowable uses of an easement is an important want to protect yourself and your land.   I always recommend using an attorney to assist with drafting or at least final review of an easement agreement rather than just relying on a template or form.

The post Easement Dispute Offers Important Reminders When Dividing Land appeared first on Texas Agriculture Law.

March has been another busy month for agricultural law news around the country.  Let’s take a look at some of the biggest stories.

* House Ag Committee passes Farm Bill 2.0.  Earlier this month, the United States House Committee on Agriculture passed the “Farm Bill 2.0,” formally titled the Farm, Food, and National Security Act of 2026.  The bill will now proceed to the full House. The vote was 34-17 with 7 Democrats voting with 27 Republicans on the Committee.  Key provisions of the bill relate to prohibiting laws like California’s Prop 12 and banning state-level pesticide labeling.  [Read article here.]

* Federal court dismisses Trump administration lawsuit challenging California’s Proposition 12 application to laying hens.  A federal district judge in California has dismissed a lawsuit filed by the United States against California’s Proposition 12.  The administration claims that the portion of Prop 12 related to spacing requirements for laying hens and prohibiting eggs to be sold in California if the spacing standards are not met is preempted by the federal Egg Products Inspection Act.  [Read Order here.]  Importantly, the dismissal was based on standing grounds–not the merits of the claim.  The court held that the United States lacked standing to bring the claim because they failed to show that Prop 12 harmed the administration.  The court did give the DOJ the opportunity to amend the complaint to address this issue and re-file the lawsuit.

* Lesser Prairie Chicken listing removed from Endangered Species Act.   The US Fish and Wildlife Service has issued a final rule that removes the Lesser Prairie Chicken from being listed under the Endangered Species Act.  The rule removes both of the distinct population segments included in the species’ listing. This rule comes on the heels of federal court decisions invalidating the listings.  [Read Final Rule here.]

* Special Master endorses settlement in Texas v. New Mexico.  Judge D. Brooks Smith, currently serving as Special Master in the Supreme Court water lawsuit Texas v. New Mexico has issued a report recommending approval of a settlement agreement that has been reached between the parties. [Read Report here.]  The settlement must still be approved by the United States Supreme Court.  [Read article here.]

*Texas suing companies for alleged improper disposal of wind turbine infrastructure.  The State of Texas has filed suit against a number of companies claiming they illegally dumped thousands of wind turbine blades and materials at disposal sites near Sweetwater, TX.  The lawsuit alleges that the companies created disposal sites where they illegally stockpiled blades and parts from wind turbines.  This, the AG claims, violates Texas’ solid waste laws.  The suit seeks both civil penalties and injunctive relief.  [Read Complaint here.]

*Article on produced water in Texas.  The Texas Water Resources Institute recently published a good article in the Texas Water Journal looking at the implications of the Texas Supreme Court ruling in Cactus Water Services v. COG Operating related to produced water.  [Read article here.]

*Court grants preliminary approval for Roundup settlement. A Missouri court has issued preliminary approval of the $7.3 billion settlement in litigation involving claims that Roundup caused cancer.  Notice will be sent to potential class members, and a fairness hearing will be held in July.  [Read article here.]

* Federal court upholds Florida’s lab grown meat ban.  The United States Court of Appeals for the Eleventh Circuit issued an opinion in Upside Foods v. Commissioner, a lawsuit claiming that Florida’s ban on lab-grown meat is not expressly preempted by the federal Poultry Products Inspection Act.  This ruling is consistent with other circuits that have drawn a distinction between a product ban versus rules on how a federally inspected facility operates.  [Read article here.]

* Ohio farmer highlights succession plan challenges.  The Ohio Farmer recently published an interesting article from the perspective of a young farmer seeking to remain involved with the farm, but also to make a plan to set him up for success in the future.  These are issues a lot of farm and ranch families face and need to take the time to think through.  [Read article here.]

* Oil and Gas Lease basics blog series.  John McFarland is currently publishing a series on the basic parts of the oil and gas lease on his Oil and Gas Lawyer Blog. He initially wrote these posts over a decade ago, but is now re-publishing them.  I highly recommend for law students or anyone interested in the basics of oil and gas law and the oil and gas lease. [Read first post here.]

* Stock show update.  My kids just wrapped up their stock show season showing sheep and steers.  They had a great year and we were fortunate to put one steer and four lambs in the sale at the Texas Majors.

Upcoming Programs 

April will be a busy month with nine programs on my calendar.  Highlights include the Terry County Women in Ag program in Brownfield, which is always one of my favorite events of the year and includes wine tasting  and a fashion show, the Bennett Trust Land Stewardship Conference in Kerrville, which has a water theme this year, and our FarmHope event in Sinton where we focus on farm and ranch estate planning and mental health.

To see a complete list of my upcoming programs, click here.

The post March 2026 Monthly Round Up appeared first on Texas Agriculture Law.

The Texas Supreme Court recently decided an interesting contract case involving an agreement to supply water for fracking in Equinor Energy v. Lindale Pipeline.  [Read Opinion here.]

Photo by Brad Weaver

Background

Fracking is a common method of oil and gas production in the United States.  It involves pumping water down a well into a formation under high pressure, causing the formation to crack open and the oil or gas to flow into the wellbore.  Fracking requires large amounts of water, and companies often contract with water suppliers to transport water to well sites.  Historically, this water transportation was done via truck.  In 2020, a new technology was developed that allowed transportation of water directly to well sites via underground pipelines.

In 2009, two companies entered an agreement related to providing water via pipeline to fracking operations in North Dakota.  Equinor’s predecessor agreed to finance construction of a freshwater pipeline and to take ownership of the pipeline once construct was complete.  Lindale agreed to serve as the exclusive water supplier “on the Pipeline” and to charge below-market rates for water.  Specifically, the parties’ agreement provided that “Lindale shall be the sole and exclusive water provider and pumper on the Pipeline; however, in the unlikely event that Lindale is unable to provide water through the Pipeline for [Equinor], [Equinor] may then use other water sources or pumpers on the Pipeline.”   The term “Pipeline” was defined as the “freshwater pipeline, lateral lines, related facilities, well-site appurtenances, rights-of-way, easements, and permits owned by [Equinor] as of the date of this Agreement, including without limitation, those described and shown on [the map] attached hereto.”

A few years after this contract was signed, Equinor acquired the predecessor company that entered into the agreement with Lindale. During that same period, new water supply technology developed that was cheaper than the underground pipelines addressed in the agreement.  Lay-flat hoses are similar to large fire hoses that lay on the ground, and they are cheaper to use than underground pipelines.  Equinor began purchasing water from other suppliers that used the lay-flat technology, rather than purchasing water from Lindale.

Litigation

Lindale filed suit against Equinor claiming breach of contract.  Lindale argued that the agreement gave Lindale the exclusive right to supply water for Equinor’s fracking operations.  Equinor responded that the oil wells for which it purchased the outside water were not “on the Pipeline,” meaning they were outside the scope of the agreement’s exclusivity clause.

The trial court found the agreement ambiguous and submitted the question of its meaning to a jury.  The jury sided with Lindale and awarded $26 million in damages.

Equinor appealed, arguing it did not breach the contract and that, even if it did, the damage award was excessive.  The Houston (First District) Court of Appeals sided with Lindale and affirmed the trial court judgment on both counts.

Equinor sought review from the Texas Supreme Court.

Texas Supreme Court Opinion

The Texas Supreme Court reversed and remanded the case. [Read Opinion here.]

The Court noted that the entire case hinged on whether Equinor’s wells were “on the Pipeline” such that they fall under the provision of the agreement’s exclusivity clause.

The contractual definition of “Pipeline” provided “the freshwater pipeline, lateral lines, related facilities, well-site appurtenances, rights-of-way, easements, and permits owned by Equinor.”  Equinor notes that that the oil wells themselves are not on this list, so the exclusivity clause does not apply to water bought for those wells and transported through flat-lay hoses other than the Pipeline.  The case essentially comes down to the meaning of the word “on.”  Equinor argues “on” means “through,” meaning the parties agreed Lindale would be the exclusive supplier of water that flowed through the pipeline.  Lindale, however, argues that “on” means “next to” such that it has the exclusive right to supply water for wells attached to the Pipeline.

The Court reviewed several dictionary definitions of “on” and found that different definitions could support each party’s position.

The Court noted that “on the Pipeline” modifies the nouns “provider” and “pumper.”  According to the Court, this sentence structure is inconsistent with Lindale’s argument that the wells are “on the Pipeline” simply because they are connected to it. To read the sentence the way Lindale requests would require the Court to essentially read in language such as “oil wells.”  It would force the clause to be interpreted as, “exclusive water provider and pumper [for oil wells] on the Pipeline.  The Court refused to accept this invitation to read additional language into the contract.

Next, the Court noted the exception clause uses the word “through” and “on” somewhat synonymously.  It says that if Lindale is unable to provide water through the Pipeline, Equinor may use other water sources or pumpers on the Pipeline.  This suggests the purpose of the pumper on the pipeline is to get water through the pipeline, not to pump water into conduits adjacent to the Pipeline.

Lindale also argued that the map incorporated by reference into the definition of “Pipeline” supports its interpretation. Lindale claims the map shows not only the lateral lines and components of the Pipeline but also shows the existing oil wells at the time the agreement was signed.  This, Lindale argued, means that the exclusivity clause incorporates the map and those oil wells thereon by reference.   The Court disagreed.  The map does not make the oil well part of the Pipeline.  The map was included to describe the enumerated component of the Pipeline, not to expand the list of such components.  Oil wells were not included in the definition of “Pipeline,” and the Court found it immaterial that the map depicts them.

Finally, the Court rejected the “purposivist arguments” Lindale offered about what it wishes had been written in the contract.  First, the Court rejected an argument about the purpose of the agreement include in the introductory section.  Because it found the exclusivity clause unambiguous, it need not look at this evidence of the parties’ purpose.  The same was true for evidence about the course of dealings between the parties. Lindale also argued it would not have entered into the agreement if the exclusivity clause did not include water used at the wells themselves.  The Court rejected this, holding “we have no business rescuing parties from contracts that turned out to be bad deals in the name of utilitarianism or equity.  Our job is to read the words chosen by the contracting parties.”

Based on the plain language of the text, the Court concluded that the oil wells were outside the scope of the exclusivity clause. As a result, Equinor was free to purchase water from any supplier it chose without breaching the agreement with Lindale. Because the Court held that the oil wells at issue sit outside the scope of the contract’s exclusivity clause, it sided with Equinor and reversed the lower court judgments.

Key Takeaways

While this may not be an agricultural law case, it offers a couple of important considerations for anyone, including agricultural producers and rural landowners, to keep in mind when entering into any type of contractual agreement.

First, the words in the contract matter.  Here, a $26 million verdict was erased because of the interpretation of the two-letter word, “on.”  It is critical that before entering into any agreement, parties ensure the language is clear, unambiguous, and reflects their agreement.  I always recommend hiring an attorney licensed in your jurisdiction to review agreements prior to signing.

Second, what the contract says matters more than what the parties may have meant.  If a court holds that contractual language is unambiguous, as the Texas Supreme Court did here, it does not look at any other evidence.  That means the parties’ intent, outside agreements or conversations not included in the contract, and historical dealings, might well show something different, but it will not be considered because the contractual language is unambiguous. This is why it is so critical for a written agreement to include every part of an agreement, every detail, every promise, every understanding of the parties before it is signed.

The post Important Reminders on Contract Interpretation from Texas Supreme Court appeared first on Texas Agriculture Law.

The Amarillo Court of Appeals has reversed a $1.2 million jury award in a dispute over wind rights on land in Hale County.

Photo by Karsten Wurth on Unsplash

Background

This lawsuit involves a dispute over who owns wind energy development rights on a 256-acre property in Hale County, Texas.

Glendale King owned the land at issue.  In 2010, he entered into a Wind and Easement Lease Agreement with Hale County Wind Farm, LLC.  In that lease agreement, the property description was as follows:

Glendale King – 100%

All that real property located in Hale County, Texas containing 256 acres, more or less, described as follows: 

Tract 1 S/PT of E 1/2 of section 58, Block R, Abstract AB 1695, Hale County, TX being 256 acres.   

The lease included a Development Term ending on the earlier of (1) HCWF beginning to sell electricity, or (2) 7 years from the effective date of the agreement, which would have been August 24, 2017.  There was a potential two-year extension of the Development Term if construction was commenced before the 2017 deadline.

Five months later, Mr. King conveyed some property interest to the Smalleys.  He reserved half of the mineral interest on the property and retained a life estate in “all royalties derived from the production of Wind Energy” and the “right to lease the Property for Wind Energy Production purposes.”  At Mr. King’s death, all wind rights would revert to the Smalleys. The deed did allow the Smalleys to receive surface damage payments from wind development.

The wind lease saw multiple transfers from 2010-2020, but the court found two crucial to the dispute.  First, in July 2015, Mr. King and then-leaseholder Hale Community Energy executed an amendment to the 2010 lease.  It replaced the Development Term language in the 2010 lease with the following language regarding the end of the Development Term: (1) the date HCE begins selling electrical energy generated by wind turbines, or (2) the 7th anniversary of the Effective Date.  The Effective Date of the Amendment was July 30, 2015.

In October 2017, the Smalleys executed a Second Amendment with then-leaseholder Hale Wind Energy, which extended the Development Term to August 24, 2020, and replaced the original property description with detailed metes and bounds.  This amendment had an effective date of August 23, 2017, which was one day before the original 2010 lease was set to expire.

Southwestern Public Service Company (SPSC) acquired the lease rights and began construction in June 2018.  It completed two turbines and began producing electricity in June 2019.

In September 2020, King executed a Wind Deed and Conveyance to Ridge Renewables, LLC (Ridge) for $30,000.  This conveyance gave rise to the central legal dispute in the case.

Litigation

Ridge sued SPSC in December 2020.  Ridge claimed that the 2010 wind lease expired on August 24, 2017, making SPSC’s operation of the turbines on the land an unlawful trespass.  Ridge sought damages and injunctive relief.

In January 2022, Ridge filed a motion for summary judgment, seeking a ruling on five issues, including the validity of the 2010 lease.  Their summary judgment motion offered two alternative theories.  First, Ridge claimed the 2010 lease contained an inadequate property description, which violated the statute of frauds and made the lease invalid.  Second, Ridge claimed that even if the lease was initially valid, it expired on August 24, 2017, without a valid extension.

Ridge also challenged the validity of both the 2015 Amendment and 2017 Second Amendment. It argued the 2015 Amendment failed to extend the termination date of the Development Period, and the 2017 Second Amendment was invalid because the Smalleys did not have the authority to execute the agreement as they owned only surface rights.

In summary, Ridge argued:  If the 2010 lease violated the statute of frauds and was invalid or expired in 2017, then King retained the authority to convey the rights to Ridge, and SPSC’s operations were a trespass.  If SPSC holds valid lease rights pursuant to the 2010 lease and subsequent amendments, then King granted the same wind development rights twice–to the SPSC predecessors and then again to Ridge.

The trial court granted Ridge’s Motion for Summary Judgment holding in relevant part that Ridge had exclusive rights to develop wind on the property, that the 2010 lease either violated the statute of frauds or terminated by its own terms on August 24, 2017, and that SPSC’s wind operations constituted ongoing bad-faith trespass entitling Ridge to damages.

The case then proceeded to a four-day trial.  The jury was tasked with awarding damages only, as the court had already decided SPSC’s conduct constituted bad-faith trespass at the summary judgment stage.  The jury awarded damages of $1,049,634 million in damages, plus $115,848 in attorney’s fees and $260,285.66 in prejudgment interest.

SPSC filed an appeal.

Appellate Court Opinion

The Amarillo Court of Appeals reversed.  [Read Opinion here.]

Did the 2010 lease violate the statute of frauds as a matter of law?

The court focused first on the validity of the 2010 contract’s property description.

Under Texas law, a conveyance of land must meet the statute of frauds requirements, which includes adequately describing the land so that the relevant property interests may be identified with reasonable certainty. While Texas courts strictly enforce this requirement, they interpret property descriptions liberally to uphold valid conveyances when possible.  This is in line with the statute’s purpose of preventing fraud, not invalidating legitimate transactions based on technical deficiencies.  “A description must provide reasonable certainty sufficient to enable a person familiar with the locality to identify the specific property and distinguish it from other parcels.  This practical standard recognizes that property identification depends on context and local knowledge, not abstract geometric precision.”

Ridge argued that the legal description–particularly the language: Tract 1 S/PT of E ½ of section 58, Block R, Abstract AB 1695, Hale County, Texas being 256 acres–provided insufficient information about boundaries, shape, or specific location within Section 58.  This argument, the court reasoned, ignored critical evidence, that being the ownership statement of “Glendale King – 100%.”  Texas law requires the complete property description, including ownership language, be considered.  The Texas Supreme Court has held that ownership language can provide sufficient property identification if it can be shown that the party owns only one tract of land answering the description.   The court held this to mean that King’s ownership statement combined with the general location information might be adequate to satisfy the statute of frauds if extrinsic evidence showed that King owned only one 256-acre tract in the described area. Ridge focused exclusively on whether the property could be identified by the legal description, not whether it could be identified by the ownership language plus the legal description plus extrinsic evidence.

In light of this, the court held that Ridge failed to establish the property description was inadequate as a matter of law, and therefore, summary judgment should not have been granted on this issue.  Was the legal description sufficient?  The court did not rule on that issue–only that the answer to that question could not be decided as a matter of law on summary judgment.

Did the 2010 lease expire in 2017?

Next, the court turned to the question of whether the 2010 lease expired on August 24, 2017.

This issue turns on whether the “Effective Date” was modified by the 2015 Amendment.  Ridge argued that the 2015 Amendment did not change the meaning of “Effective Date” from the initial 2010 contract, which was August 24, 2010.  SPSC claims that the 2015 Amendment did modify the meaning of the “Effective Date” to July 30. 2015, the effective date of the Amendment.

When interpreting contracts, courts seek to determine the parties’ intentions by interpreting the agreement as a whole and applying the plain meaning of language unless context requires otherwise.  Courts avoid interpreting contractual provisions in isolation, trying instead to determine how they relate to each other and the contract’s purpose. Courts can construe unambiguous provisions  according to the plain language of the contract, but when contractual language is subject to multiple reasonable interpretations, courts cannot resolve that through summary judgment, because it becomes a question of fact for the jury.

The court held that Ridge’s interpretation ignores the parties’ choice regarding the Amendment language.  The parties deleted Section 3.1, the Development Term completion section, in its entirety.  Nothing in the Amendment indicated their desire to leave the Effective Date unchanged.  They could have cross referenced the original Effective Date, or included express language preserving the 2010 date.  This was not done.  Instead, they deleted the entirety of Section 3.1, replaced it with similar language, and simultaneously agreed upon a new definition of “Effective Date” in the Amendment.  These choices, the court reasoned, indicated an intent to modify the timeline rather than preserve it.

Ridge also argued that recognizing the 2015 Effective Date creates inconsistencies through the amended agreement, including those related to insurance, representations and warranties, hazardous materials, and termination effects.  This, the court explained, at most, supports the conclusion that summary judgment was not appropriate.  These are factual issues that may not be resolved on summary judgment as a matter of law.

Based on these decisions, Ridge failed to conclusively prove it possessed superior contractual rights to develop the wind energy as a matter of law.  SPSC’s first issue on appeal was sustained.

What Happens Next?

The Amarillo Court of Appeals reversed the judgment and award of attorney’s fees and remanded the case back to the trial court for further proceedings.  This would likely include a trial to determine whether Ridge can prove its claims to a jury.  However, Ridge has filed a Petition for Review with the Texas Supreme Court.  The Court has not yet ruled on that Petition as of this blog being published.

Key Takeaways

First, I think it important to highlight that wind energy rights can be severed off from surface rights in Texas.  Here, Mr. King sold the surface of the land to the Smalleys, but he reserved a live estate in the wind energy royalties and the right to execute any wind leases.  The concept of rights like wind, minerals, groundwater, solar, and geothermal is something important for anyone buying or selling land in Texas to understand.

Next, this case offers an important reminder of the importance of ensuring clear, unambiguous language in contractual agreements like wind leases.  Ensuring that property descriptions are clear, unambiguous, and properly drafted is critical to comply with the statute of frauds and to avoid litigation over the validity of a document.

Third, anytime an amendment to a contract, lease, or other legal document is drafted, it is extremely important to ensure it is clear and unambiguous how the initial agreement and the subsequent amendment will be construed together.  This can be easier said than done, but oftentimes, amendments are not nearly as simple as they may initially seem.  This can cause interpretation issues with agreements down the road.

The post Appellate Court Reverses Million Dollar Verdict in Dispute Over Wind Rights appeared first on Texas Agriculture Law.

The United States Supreme Court has agreed to hear Durnell v. Monsanto, a case raising the question of whether state law failure-to-warn claims are preempted by federal pesticide law.

Image by Zach Dulli from Pixabay 

Background

Monsanto is an agrochemical company that has manufactured and sold the herbicide marketed under the tradename Roundup since 1970s.  Note that Bayer purchased Monsanto in 2018, so there may be references to both companies as we discuss the case.  Roundup is one of the most popular and most utilized herbicides in the United States and is used in both agricultural production and non-agricultural settings such as landscaping.  The active ingredient in Roundup is glyphosate.

Over the past decade, there have been tens thousands of lawsuits filed across the United States claiming that the glyphosate in Roundup caused the plaintiffs to develop cancer.   Mr. Durnell is one such plaintiff who suffers from non-Hodgkin’s lymphoma.   His Petition for Certiorari describes him as “one of more than 100,000 plaintiffs” seeking to hold Monsanto liable for failure to warn users that glyphosate causes cancer.

Mr. Durnell filed a lawsuit against Monsanto in state court in his home state of Missouri.  He made a number of state law claims, including negligence, strict liability, defective product, and relevant to the Supreme Court appeal, a claim that Monsanto failed to warn of the health dangers of using Roundup.  Specifically, he points to both the label on Roundup, and the advertising materials promoting the product, as failing to warn about the cancer risks associated with use.

Litigation

At trial, the jury found in favor of Mr. Durnell on his failure-to-warn claim, finding that Monsanto failed to warn about the possible health implications of using Roundup.  They returned a $1.25 million award for the Plaintiff.  The jury found in favor of Bayer on the negligence and defective product claims.  Bayer appealed the verdict on the failure-to-warn claim to the Missouri Court of Appeals.  The appellate court affirmed, holding that the failure-to-warn claim was not preempted by federal law.  Bayer sought review by the Missouri Supreme Court, but its Petition for Review was denied.

Bayer then sought review from the United States Supreme Court.  (Petition for Writ of Certiorari here.)  Specifically, Bayer asked the Court to review the question of whether the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) preempts a failure-to-warn claim based on state law.  The United States Supreme Court granted the Petition and agreed to hear the case in January 2026.

Failure-to-Warn Claims

Typically, a failure-to-warn claim is made under state law essentially claiming that a product manufacturer failed to provide adequate warnings about the safety of using a product. To prove a failure-to-warn claim, a plaintiff must usually show that (1) the manufacturer knew or should have known the risk; (2) the warning provided by the manufacturer was inadequate; and (3) the inadequate warning caused damages to the plaintiff.

FIFRA

FIFRA is the federal law that regulates pesticides in the United States.  No pesticide can be sold or distributed in the United States until the EPA has approved the product for use.  As part of this  approval process, the EPA must approve the specific labeling language to be included with the registered pesticide.

Additionally, FIFRA provides that states are allowed to regulate the sale of a federally registered product, but may not “impose or continue in effect any requirements for labeling or packaging in addition to or different from” those required by federal law.

Also relevant to this case, FIFRA provides that a product is “misbranded” if it does not include a “warning statement which may be necessary to protect health and the environment.”

Preemption of Failure-to-Warn Claims by FIFRA

This question of whether FIFRA preempts state law failure-to-warn claims has been raised before at the federal level. There have been three federal appellate level cases all involving plaintiffs claiming Monsanto failed to warn about the cancer risk of Roundup.  Interestingly, appellate level courts that have reached this question have come to different conclusions, creating what is known as a “circuit split.”

The United States Court of Appeals for the Third Circuit has held that such claims are preempted by FIFRA in Schaffner v. Monsanto Corp. in 2024.  There, the Third Circuit held that requiring a cancer warning on the label would impose requirements “different from” the EPA-approved labeling, which was not permitted under FIFRA.

On the other hand, the United Stated Courts of Appeals for both the Ninth and Eleventh Circuits found the opposite, holding that state law based failure-to-warn claims should proceed and were not preempted by FIFRA.  The Ninth Circuit reached this decision in 2021 in Hardeman v. Monsanto and the Eleventh Circuit followed suit in Carson v. Monsanto in 2024.

Bayer’s Arguments

Bayer argues the failure-to-warn claim is preempted by federal law.  They point to the language in FIFRA that expressly provides that a state may not require a label to include language in addition to or different from the federal labeling requirements.  Bayer says that the Plaintiff’s desired cancer warning label would require Bayer to amend the Roundup label to include a cancer warning not required on the federally approved label. This, they argue, is “in addition to or different from” the federal label and, thus, preempted by FIFRA.   Bayer claims it could not have added the label required by the jury verdict in this case without obtaining federal approval to do so.  “Monsanto is not free to change its labels without first seeking and obtaining EPA approval,” Bayer wrote it its Brief.

Bayer also relies on a prior United States Supreme Court decision in Bates v. Dow Agrosciences LLC, decided in 2005.  There, the court held that a state law requiring a label to bear the word “Danger” was preempted by FIFRA when the federal label required the word “Caution.”

You can view Bayer’s brief on the merits here.

Plaintiff’s Arguments

The Plaintiff has not yet filed his brief on the merits, but once he has done so, we will provide a link to it here.  He did make certain arguments in his Response to the Petition for Certiorari that give insight into his arguments.

Plaintiff, of course, argues his claims are not preempted by FIFRA.  He relies on FIFRA’s misbranding provisions, claiming that FIFRA deems a product misbranded if it does not include a warning statement necessary to protect health.  This, Plaintiff argues, is the exact claim he is making, that Monsanto failed to include a cancer warning which was necessary to protect his health.

Additionally, Plaintiff also relies on the United States Supreme Court decision in Bates v. Dow Agrosciences LLC.  He argues that while Bates held that it was “perfectly clear” that FIFRA did not preempt claims that would not require manufacturers to label or package their products in any particular way.  He argues that nothing in FIFRA prevented Monsanto from including warnings in advertisements that Roundup may be carcinogenic or that people should wear protective gear when spraying it.

What Happens Next?

Oral argument has been set for April 27, 2026.  The Court will hear the oral arguments and then proceed to consider the case.  A written decision from the Court would be expected by the end of the term in June.

Meanwhile, a number of amicus curiae briefs have been filed in the litigation.  You can see the list of filers and briefs here.  Interestingly, the Court invited the Solicitor General of the United States to weigh in on the position of the United States in this case.  The United States filed its amicus brief agreeing with Bayer’s argument that the claims should be preempted by federal law, specifically discussing the burden that a piecemeal labeling system would cause were every state able to require different pesticide labeling rules.

Why Do We Care? 

As Bayer’s brief explains, “The question presented is critically important, and the stakes are high.”  This is true for a couple of reasons.  First, there is the existing circuit split and the law when it comes to preemption under FIFRA for state law failure-to-warn claims is not settled.  Second, there are hundreds of thousands of plaintiffs in lawsuits similar to Mr. Darnell’s who will be impacted by the answer to the question presented here.  Third, shortly after the Supreme Court agreed to hear the case, Bayer announced it had reached a proposed class action settlement of $7.25 billion to resolve current and pending disputes alleging non-Hodgkin lymphoma injuries from Roundup.  It seems likely that the Supreme Court agreeing to take the case likely aided in a settlement being reached.  On March 4, 2026, the settlement was preliminary approved by the court.  Fourth, as Bayer argues and several amicus briefs highlight, this may impact the agriculture industry with regard to the availability of and price for pesticides.

The post US Supreme Court to Hear Case on Pesticide Preemption appeared first on Texas Agriculture Law.

In January, the United States District Court for the Western District of Texas held a Texas law related to labeling of analogue meat products was unconstitutional in Turtle Island Foods Inc. v. Shuford.  [Read Order here.]

Photo via Like Meat on Unsplash

Background

In 2023, the Texas Legislature passed Senate Bill 664, a statute requiring specific labeling be included on any “analogue” meat products.  The statute defines “analogue product” as “a food product derived by combining processed plant products, insects, or fungus with food additives to approximate the texture, flavor, appearance, or other aesthetic qualities or the chemical characteristics of any specific type of egg, egg product, fish, meat, meat food product, poultry, or poultry product.”  See Tex. Health & Human Safety Code 431.0805.  Further, the statute deems an analogue product misbranded unless it bears the following language in a certain size in close proximity to the name of the product on the label:  analogue, meatless, plant-based, made from plants, or a similar qualifying term or disclaimer intended to clearly communicate the contents of the product to a consumer.  See Tex. Health & Human Safety Code 431.082.

Litigation

Plaintiffs, manufacturers of Tofurky and the Plant Based Food Association (PBFA), a nonprofit trade association whose members manufacture and sell plant-based products filed suit claiming this statute was unconstitutional.  Specifically, they argued the statute was preempted by federal law, violated the Supremacy Clause, violated the dormant Commerce Clause, violated the 14th Amendment Due Process Clause, and violated the First Amendment.

After some initial motion decisions related to the propriety of certain named defendants, the case came before the court on cross Motions for Summary Judgment.

Order on Summary Judgment Motions

First, the court addressed the issue of standing in this case, holding that both Turtle Island Foods and the Plant Based Food Association had standing to bring this suit and that the claims were ripe.

Next, the court turned to the Plaintiffs’ First Amendment claims.

Plaintiffs’ speech is not misleading.

Commercial speech is protected by the First Amendment if it is neither “misleading nor related to unlawful activity.”

Commercial speech cases have held that speech is only misleading when it deceives or is inherently likely to deceive.  Statements that are only “potentially” misleading are protected by the First Amendment.

The court held Tofurky’s labels clearly indicate that their products are meat substitutes that are plant-based and vegan.  Therefore, the court held, their labels are not misleading. Plaintiffs hired experts to conduct a survey of Texans, in which 96% correctly identified the meatless products were plant-based and not made from animals. The rate of accuracy was not higher where the meatless products had a label altered to conform with SB 664.  In fact, the survey showed an increase in confusion for Beyond Meat Ground Beef when the label was modified in accordance with SB 664.  Experts also reviewed existing literature, which similarly found no consumer confusion regarding plant-based product labels.  The court also noted that in other cases challenging similar laws in other states, courts have found plant-based product labels do not cause confusion.

Defendants claimed that Tofurky and PBFA’s labels do mislead traditional meat-eating consumers into purchasing their products, but the court noted they did not offer any evidence in support of this assertion. Defendants did not conduct or review any studies on consumer understanding of plant-based meat labels.

Thus, there was no material dispute of fact that Plaintiffs’ labels are not misleading and do not deceive consumers.

SB 644 fails the three-part commercial speech test.

To restrict commercial speech, the government must satisfy a three-part test:

(1) the state must assert a ‘substantial’ interest in justifying the restriction;

(2) the restriction must “directly advance the governmental interest asserted; and

(3) the restriction must not be ‘more extensive than is necessary to serve that interest.

Here again, the court found in favor of the Plaintiffs.

First, the court found Defendant did not demonstrate that SB 664’s restrictions target a substantial government interest.  Their stated interest, to protect consumers and ensure they understand the products they are purchasing, was undercut by their own representatives, who repeatedly stated they were unaware of any consumer confusion.   This lack of ability to point to confusion is true, despite the fact that these meatless products have been in existence for decades.

Second, both federal and state consumer protection laws prohibit unfair or deceptive trade practices, including the sale of misbranded products. Were the State of Texas to receive complaints about confusion, they could enforce existing law to address such violations.

Third, Defendants offered no reason why the statute would advance the government interest asserted.  They offered no evidence rebutting the survey results that the statutorily required language caused more consumer confusion.

Fourth, Defendants failed to show that SB 664 was not more extensive than necessary to meet the state’s interest.  The state could enforce existing laws to meet it’s interest.  It could require labeling of a smaller size than that required by the statute, as has been done in other states.

Based on this, the statute is unconstitutional as applied to the Plaintiffs in this case.

The statute is also facially unconstitutional.

Generally, to succeed on a facial challenge, a plaintiff must show not only that the statute is unconstitutional as applied to them, but also that there are no set of circumstances under which it could legally be applied. For First Amendment cases, the bar is slightly lower, requiring courts to ask whether “a substantial number of the law’s applications are unconstitutional, judged in relation to the statute’s plainly legitimate sweep.”

First, courts look at the statute’s scope.  As noted above, the law applies to non-misleading commercial speech.

Second, court look to determine which of the laws’ applications violate the First Amendment, and measure them against the rest. The constitutionally impermissible applications of the law substantially outweigh the permissible ones.  This is particularly true because any misleading labels would be prohibited by other laws. Despite regulations prohibiting misbranded food being in place for decades, there was no evidence of consumer confusion over plant-based food labels.

Thus, the court found the law facially unconstitutional.

The court did not reach remaining claims.

Because the court held the statute violated the First Amendment, it did not reach the remaining claims.

Conclusion

It does not appear that an appeal has been filed at this time.  As it stands, Texas will be unable to enforce SB 664’s labeling requirements for plant-based meat products in Texas.

The post Court Finds Texas “Fake Meat” Labeling Law Violates First Amendment appeared first on Texas Agriculture Law.

The month of February has brought a number of new court rulings, agency action, and litigation.  Let’s get caught up on some of the biggest agricultural law stories this month.

Photo by Scott Ymker on Unsplash

*US Supreme Court strikes down tariffs under the International Emergency Economic Powers Act.  The United States Supreme Court issued its opinion in Learning Resources, Inc. v. Trump, holding that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs.  To enact such tariffs, the President would need “clear authority” from Congress, which the language in the IEEPA does not provide.  The ruling left several unanswered questions, including if or how refunds would be issued for tariff payments made and whether another statute might provide the President with the “clear authority” required to impose tariffs.  [Read Opinion here and article here.]

*EPA approves registration for over-the-top Dicamba for use in 2026-2027 growing seasons; lawsuit filed.  On February 6, 2026, the EPA announced its registration for three over-the-top dicamba products (Stryax, Engenia, Tavium) for the 2026 and 2027 growing seasons.  [Read announcement here.]  The registration includes a number of modifications and stricter rules for application. [Read article here.]  This week, environmental groups have filed suit asking the United States Court of Appeals for the Ninth Circuit to vacate the registration because it alleges the EPA failed to follow proper procedures in approving the registration.  [Read article here.]

*House releases draft of 2026 Farm Bill.  The House Committee on Agriculture has released its newest draft of the Farm Bill.  The Farm, Food, and National Security Act of 2026 would in part invalidate animal confinement laws like California’s Proposition 12, transfer Food for Peace to the USDA, reauthorize the Conservation Reserve Program, mandate uniform pesticide labels, require additional reporting for foreign-owned farmland.  Markup on the bill is currently scheduled for next week. [Read Bill here.]

*Settlement of $7.25 billion proposed in Roundup litigation.  A proposed settlement in the amount of $7.25 billion has been announced in litigation related to failure to warn consumers that Roundup could cause cancer.  The settlement must be court-approved.  The settlement was announced after the United States Supreme Court agreed to hear Durnell v. Monsanto, a case involving a failure to warn claim and whether federal preemption applies.  [Read article press release here and  here.]

*Using business entities to transfer farm/ranch ownership. Robert Moore from Ohio State University recently wrote a great article about using business entities, like an LLC, to transfer ownership of the farm or ranch.  [Read article here.]

*Attention ag lawyers: Do you want to speak at the American Agricultural Law Association Conference?  Of course you do!  We are currently accepting speaker proposals for our 2026 conference in Dallas, TX on November 5-7, 2026.  For more information on submitting a proposal, click here.  Even if you don’t want to speak, you should still attend!  Learn more about the conference generally here.

The post February 2026 Monthly Round Up appeared first on Texas Agriculture Law.

Recently, Shelley Huguley with Southwest Farm Press published an article and video featuring our FarmHope project.  We appreciate Shelley’s willingness to highlight our project.

You can read the article here and view the video here.

If you are involved in Texas agriculture or have family members in need of free counseling services, reach out to FarmHope at 979-436-0700.

The post Sowing Seeds of Hope appeared first on Texas Agriculture Law.

We are ringing in 2026 with a change to the federal estate tax exemption.  Understanding how estate and gift taxes are calculated and knowing the current exemption amounts are key components to a successful estate plan.

Photo by Jake Gard on Unsplash

Background

As we have discussed numerous times on this blog and our Ag Law in the Field Podcast, Congress sets an amount of assets that a person is allowed to give during their lifetime or at death without incurring estate or gift tax liability. This is known as the lifetime exemption.  The IRS adjusts the amount each year for inflation. Persons whose estate value is over the lifetime exemption will incur federal estate tax liability of 40% on the overage.

Additionally, federal tax law allows each taxpayer to gift a certain amount to another individual without incurring federal gift tax liability.  This amount is known as the annual exclusion.  This amount is critical for anyone utilizing gifting as part of their estate planning strategy.

[For more information on these taxes, read prior blog posts here and here and listen to prior podcast episode here.]

2026 Limits

With the passage of the One Big Beautiful Bill Act in July 2025, the 2026 estate tax exemption was set at $15 million/person ($30 million/couple), an increase of $1.1 million from the 2025 exemption amount.  Importantly, without this provision in the OBBBA, the exemption amount would have sunset back to $5 million per person for 2026.  The $15 million/person is set to adjust for inflation each year and does not have a sunset provision.

The federal gift tax annual exclusion will remain at $19,000, which was the same as the 2025 exclusion amount.

What does this mean for me?

Estate and gift taxes are an issue of which everyone should be aware.  Everyone should have an idea of the fair market value of their estate.  This is a critical first step in determining if someone could be facing an estate tax issue.  Anyone who is even close to the lifetime exemption amount should be carefully planning their estate to seek to avoid this tax liability.  There are a number of tools that can be used to avoid owing estate taxes, but all of them have to be done prior to a person’s death.  This means it is critical for people to take action now to avoid owing this tax.

Additionally, people should take care when making gifts, whether monetary or of assets, and understand what gift tax implications those gifts may have.  It should also be noted that gifts made over the annual exclusion will likely result in a decrease in the lifetime exemption a person has in the future.

The best advice is to have good advice.  Folks should work with a good attorney and accountant to help determine if they could face estate tax liability to ensure there are no tax issues associated with making gifts during one’s lifetime.

The post 2026 Federal Estate and Gift Tax Exemption Information appeared first on Texas Agriculture Law.

As we do every year, Shannon Ferrell, my friend and counterpart at Oklahoma State University, and I partnered up to write an article summarizing the year in agricultural law for Farm Progress.  This year, we had lots of exciting topics like estate taxes, air emissions reporting, animal confinement laws, DOJ investigations, dicamba label proposals, and WOTUS.

Photo by Sebastian Pichler

What were our key issues for the year and what do you need to know?  Check out our article here!

Additionally, if you missed the podcast episode I did summarizing ag law in 2025 with my friend and Maryland-based Extension ag lawyer, Paul Goeringer, listen here.

The post Ag Law Issues in 2025 appeared first on Texas Agriculture Law.