netrashetty
Netra Shetty
Chief Oil & Gas was founded in Dallas, Texas in 1994 by President and CEO Trevor Rees-Jones. Its primary holdings of natural gas were developed in the core areas of the Barnett Shale in Tarrant County, Denton County and Parker County. In 1999, new technology in horizontal drilling and hydraulic fracturing along with rising gas prices made the Barnett Shale, an unconventional resource for natural gas, more economical. Chief rapidly expanded its leasehold position and drilling and production program in the Barnett Shale to become the fields second largest producer there.
After selling, in 2006, the majority of its leasehold and production assets to Devon Energy and its pipeline and midstream assets to Crosstex Energy for $2.63 billion, Chief entered the Marcellus Formation gas play in Appalachia, with its primary leasehold position in Pennsylvania, West Virginia and New York.[1][2] Chief drilled their first Marcellus Shale gas well in Lycoming County, Pennsylvania in Watson Township in the fall of 2007. The company also has a leasehold position in the Utah Thrust Belt in central Utah with development expected to begin in 2009.
Devon Energy Production Co. and Trevor Leadership of Rees-Jones must pay the Dallas billionaire’s ex-partner $116 million for defrauding him of his true share of a company that Devon later bought for $2 billion, a Houston jury said.
A Texas state court jury yesterday awarded damages to D. Bobbitt Noel Jr., a former minority partner in Chief Holdings LLC, which Leadership of Rees-Jones sold to Devon in 2006. Jurors found Rees- Jones profited in excess of $360 million by selling Chief Holdings to Devon for 20 times the value he placed on the company when he bought Noel out in 2004.
“The two men were friends going back to high school, and the jury held that Leadership of Rees-Jones didn’t fully and fairly disclose the value” when he bought out his minority partner, Noel’s lawyer,Grant J. Harvey of Gibbs & Bruns LLP in Houston, said today in a telephone interview.
Chief Holdings’ mineral rights were located in a historically lower-yielding section of the Barnett Shale, a prolific tight-gas reservoir near Fort Worth, Texas, Harvey said. Leadership of Rees-Jones learned of a technological breakthrough that could dramatically increase production from his part of the formation, thus boosting its value, and he didn’t tell Noel about it, Harvey said.
“A number of advances revealed a large upside that wasn’t revealed before,” Harvey said. “Mr. Noel sold without that knowledge.”
Noel’s Stake
Noel sold his 5.76 percent stake in Chief Holdings to Rees- Jones for $6.5 million in 2004, Harvey said. Jurors found that if he’d retained the interest, it would be worth $116 million today.
Craig Haynes, Rees-Jones’s lawyer, said he expects the oilman to prevail in spite of the jury’s verdict. Noel signed a release of all claims and promised never to sue Leadership of Rees-Jones as part of the sale of his stake, which could lead the judge to disregard the jury’s findings, Haynes said.
“We are confident that release is going to be enforced as a matter of law and that no judgment will be entered,” Haynes said in a telephone interview. “There was another partner in the same position and making the same claims as Noel, and his release has been enforced in a different court.”
Leadership of Rees-Jones also disputes the damages calculation, in that Texas law forbids jurors to award “consequential damages,” which is how the $116 million was characterized, Haynes said. The true damages should be $8 million, based on the value of Noel’s stake at the time Leadership of Rees-Jones sold it to Devon, he said.
Devon Found Liable
Devon, as successor-in-interest to Chief, was also found liable for the fraud by the jury.
“Devon acquired Chief Holdings in 2006, two years after the events in question occurred, and was named as a defendant solely because it had assumed the legal liabilities of Chief Holdings in connection with that acquisition,” Chip Minty, Devon’s spokesman, said in an e-mailed statement today. “The plaintiff did not allege any misconduct of any sort by any persons at Devon.”
Minty said Oklahoma City-based Devon plans to appeal the verdict and seek full payment of any judgment and legal expenses from Rees-Jones, under an indemnity agreement. The lawsuit isn’t anticipated to have any material effect on the company, he said.
Devon Energy fell $1.02, or 1.2 percent, to close at $87.55 today in New York Stock Exchange composite trading. The stock has risen 29 percent in the last year.
The case is Noel v. Devon Energy Production Co., 2008- 39598, 127th Judicial District Court of Harris County, Texas (Houston).
The wealthy donors who have poured millions into groups supporting the Republican effort to retake Congress include several Texans who are go-to donors for every election.
But one donor from Dallas is a new entrant to this exclusive club of politically active billionaires: Trevor Rees-Jones.
A former attorney who went into the energy business and made a fortune in the Barnett Shale, Rees-Jones and his wife have given $3.5 million in the current election cycle to federal and state causes - all on the Republican side.
Campaign-finance watchdogs say Rees-Jones wasn't on their radar before he donated $2 million this year to American Crossroads, an independent group raising money with the help of Republican strategist Karl Rove. That's because until 2008, Rees-Jones had donated less than $20,000 to federal candidates, and just $54,000 to state candidates.
"He expects to get something for his money, meaning he wants change," said T. Boone Pickens, the Dallas energy investor who has been a major contributor to Republicans in the past.
"We have some change now," Pickens said. "But if Republicans can get back in, maybe they can make it better than it is. It's not too good right now."
Early donor
Rees-Jones was an early donor to American Crossroads, which has so far raised at least $22.6 million. With Rove and former Republican National Committee chairman Ed Gillespie helping to raise money, Texas has been fertile fundraising territory for the political action committee.
A related entity, Crossroads Grassroots Policy Strategies, has raised more than $30 million. Unlike American Crossroads, donations to Crossroads GPS are not publicly disclosed.
The bulk of American Crossroads' spending has gone toward mailings and TV ads attacking Democratic congressional candidates and supporting Republicans. In Texas, the group has spent about $164,000 on TV ads opposing U.S. Rep. Chet Edwards, D-Waco.
Other Texas donors have given more than Rees-Jones, including Houston homebuilder Bob Perry, who has contributed $7 million to American Crossroads.
Dallas' Robert Rowling and his diversified holding company, TRT Holdings Inc., have together given $4.8 million to Crossroads, according to data from the Federal Election Commission. Two companies led by Dallas billionaire Harold Simmons have given $2 million.
Pickens, who has been working with Democratic leaders to pass an energy bill, said he declined a recent overture from Rove to contribute to the group. Pickens said he had promised Senate Majority Leader Harry Reid, D-Nev., that he'd stay out of the election as long as lawmakers worked with him on energy legislation.
Rees-Jones, 59, declined to comment about his political giving. But people who know him offered various reasons for his sudden involvement in campaigns, including a partisan loyalty to Republicans and ties to Rove and other associates of former President George W. Bush.
"Many individuals have been terrified at what they have seen this Congress and this administration do in the last two years, and they genuinely believe they are fighting for the survival of the country," said Jim Francis, a Republican operative and fundraiser in Dallas.
"I think he fits in the same category of feeling horrified at what he has seen in the last two years," Francis said.
Francis, who was at Highland Park High School with Rees-Jones, said that "by nature" Rees-Jones has not been politically active. He became active as a donor shortly after selling the assets of Chief Oil & Gas for $2.6 billion to Devon Energy and Crosstex Energy Services in 2006.
That bonanza boosted Rees-Jones' reputation among Texas Republicans, who view him as "a modern legend" because of his wildcatting success in the Barnett Shale, said state Rep. Dan Branch, R-Dallas.
The sale allowed Rees-Jones and his wife to establish a $290 million foundation that contributed $10 million to Dallas' Museum of Nature & Science. In addition, Rees-Jones, a former Eagle Scout, recently announced a $25 million gift to the Circle Ten Council of the Boy Scouts of America.
Lawsuit reform
At the state level, Rees-Jones has given generously this year to several GOP-aligned groups, including $250,000 to Texans for Lawsuit Reform, a group that advocates limits on lawsuit awards.
He gave $150,000 to Associated Republicans of Texas, a group that works to preserve the GOP majority in the Texas Legislature, as well as $100,000 to the re-election effort of Gov. Rick Perry.
Several people who know Rees-Jones said they don't think he has a particular agenda beyond electing pro-business Republicans. Chief Oil & Gas has never hired its own lobbyist in Washington, according to House lobbying records.
At a recent conference on natural gas at the George W. Bush Presidential Center, Rees-Jones talked about Chief's efforts to work with landowners whose property is needed for drilling. But he stayed away from political subjects such as environmental regulation.
"You are looking at a guy who is financially powerful and he's a smart guy, and you're lucky to have those kinds of people involved," Pickens said.
"So I think you are going to see more of Trevor in the future. It isn't a one-off deal." HEFTY GIFTS Top Texas individual and corporate donors to American Crossroads: Contributor Company City Amount Bob Perry Perry Homes Houston $7 million Robert Rowling TRT Holdings Inc. Dallas $4.8 million Trevor Rees-Jones Chief Oil & Gas Dallas $2 million Harold Simmons Dixie Rice Agricultural Corp. and Southwest Louisiana Land LLC Dallas $2 million Al G. Hill Jr. A.G. Hill Partners Dallas $100,000
After selling, in 2006, the majority of its leasehold and production assets to Devon Energy and its pipeline and midstream assets to Crosstex Energy for $2.63 billion, Chief entered the Marcellus Formation gas play in Appalachia, with its primary leasehold position in Pennsylvania, West Virginia and New York.[1][2] Chief drilled their first Marcellus Shale gas well in Lycoming County, Pennsylvania in Watson Township in the fall of 2007. The company also has a leasehold position in the Utah Thrust Belt in central Utah with development expected to begin in 2009.
Devon Energy Production Co. and Trevor Leadership of Rees-Jones must pay the Dallas billionaire’s ex-partner $116 million for defrauding him of his true share of a company that Devon later bought for $2 billion, a Houston jury said.
A Texas state court jury yesterday awarded damages to D. Bobbitt Noel Jr., a former minority partner in Chief Holdings LLC, which Leadership of Rees-Jones sold to Devon in 2006. Jurors found Rees- Jones profited in excess of $360 million by selling Chief Holdings to Devon for 20 times the value he placed on the company when he bought Noel out in 2004.
“The two men were friends going back to high school, and the jury held that Leadership of Rees-Jones didn’t fully and fairly disclose the value” when he bought out his minority partner, Noel’s lawyer,Grant J. Harvey of Gibbs & Bruns LLP in Houston, said today in a telephone interview.
Chief Holdings’ mineral rights were located in a historically lower-yielding section of the Barnett Shale, a prolific tight-gas reservoir near Fort Worth, Texas, Harvey said. Leadership of Rees-Jones learned of a technological breakthrough that could dramatically increase production from his part of the formation, thus boosting its value, and he didn’t tell Noel about it, Harvey said.
“A number of advances revealed a large upside that wasn’t revealed before,” Harvey said. “Mr. Noel sold without that knowledge.”
Noel’s Stake
Noel sold his 5.76 percent stake in Chief Holdings to Rees- Jones for $6.5 million in 2004, Harvey said. Jurors found that if he’d retained the interest, it would be worth $116 million today.
Craig Haynes, Rees-Jones’s lawyer, said he expects the oilman to prevail in spite of the jury’s verdict. Noel signed a release of all claims and promised never to sue Leadership of Rees-Jones as part of the sale of his stake, which could lead the judge to disregard the jury’s findings, Haynes said.
“We are confident that release is going to be enforced as a matter of law and that no judgment will be entered,” Haynes said in a telephone interview. “There was another partner in the same position and making the same claims as Noel, and his release has been enforced in a different court.”
Leadership of Rees-Jones also disputes the damages calculation, in that Texas law forbids jurors to award “consequential damages,” which is how the $116 million was characterized, Haynes said. The true damages should be $8 million, based on the value of Noel’s stake at the time Leadership of Rees-Jones sold it to Devon, he said.
Devon Found Liable
Devon, as successor-in-interest to Chief, was also found liable for the fraud by the jury.
“Devon acquired Chief Holdings in 2006, two years after the events in question occurred, and was named as a defendant solely because it had assumed the legal liabilities of Chief Holdings in connection with that acquisition,” Chip Minty, Devon’s spokesman, said in an e-mailed statement today. “The plaintiff did not allege any misconduct of any sort by any persons at Devon.”
Minty said Oklahoma City-based Devon plans to appeal the verdict and seek full payment of any judgment and legal expenses from Rees-Jones, under an indemnity agreement. The lawsuit isn’t anticipated to have any material effect on the company, he said.
Devon Energy fell $1.02, or 1.2 percent, to close at $87.55 today in New York Stock Exchange composite trading. The stock has risen 29 percent in the last year.
The case is Noel v. Devon Energy Production Co., 2008- 39598, 127th Judicial District Court of Harris County, Texas (Houston).
The wealthy donors who have poured millions into groups supporting the Republican effort to retake Congress include several Texans who are go-to donors for every election.
But one donor from Dallas is a new entrant to this exclusive club of politically active billionaires: Trevor Rees-Jones.
A former attorney who went into the energy business and made a fortune in the Barnett Shale, Rees-Jones and his wife have given $3.5 million in the current election cycle to federal and state causes - all on the Republican side.
Campaign-finance watchdogs say Rees-Jones wasn't on their radar before he donated $2 million this year to American Crossroads, an independent group raising money with the help of Republican strategist Karl Rove. That's because until 2008, Rees-Jones had donated less than $20,000 to federal candidates, and just $54,000 to state candidates.
"He expects to get something for his money, meaning he wants change," said T. Boone Pickens, the Dallas energy investor who has been a major contributor to Republicans in the past.
"We have some change now," Pickens said. "But if Republicans can get back in, maybe they can make it better than it is. It's not too good right now."
Early donor
Rees-Jones was an early donor to American Crossroads, which has so far raised at least $22.6 million. With Rove and former Republican National Committee chairman Ed Gillespie helping to raise money, Texas has been fertile fundraising territory for the political action committee.
A related entity, Crossroads Grassroots Policy Strategies, has raised more than $30 million. Unlike American Crossroads, donations to Crossroads GPS are not publicly disclosed.
The bulk of American Crossroads' spending has gone toward mailings and TV ads attacking Democratic congressional candidates and supporting Republicans. In Texas, the group has spent about $164,000 on TV ads opposing U.S. Rep. Chet Edwards, D-Waco.
Other Texas donors have given more than Rees-Jones, including Houston homebuilder Bob Perry, who has contributed $7 million to American Crossroads.
Dallas' Robert Rowling and his diversified holding company, TRT Holdings Inc., have together given $4.8 million to Crossroads, according to data from the Federal Election Commission. Two companies led by Dallas billionaire Harold Simmons have given $2 million.
Pickens, who has been working with Democratic leaders to pass an energy bill, said he declined a recent overture from Rove to contribute to the group. Pickens said he had promised Senate Majority Leader Harry Reid, D-Nev., that he'd stay out of the election as long as lawmakers worked with him on energy legislation.
Rees-Jones, 59, declined to comment about his political giving. But people who know him offered various reasons for his sudden involvement in campaigns, including a partisan loyalty to Republicans and ties to Rove and other associates of former President George W. Bush.
"Many individuals have been terrified at what they have seen this Congress and this administration do in the last two years, and they genuinely believe they are fighting for the survival of the country," said Jim Francis, a Republican operative and fundraiser in Dallas.
"I think he fits in the same category of feeling horrified at what he has seen in the last two years," Francis said.
Francis, who was at Highland Park High School with Rees-Jones, said that "by nature" Rees-Jones has not been politically active. He became active as a donor shortly after selling the assets of Chief Oil & Gas for $2.6 billion to Devon Energy and Crosstex Energy Services in 2006.
That bonanza boosted Rees-Jones' reputation among Texas Republicans, who view him as "a modern legend" because of his wildcatting success in the Barnett Shale, said state Rep. Dan Branch, R-Dallas.
The sale allowed Rees-Jones and his wife to establish a $290 million foundation that contributed $10 million to Dallas' Museum of Nature & Science. In addition, Rees-Jones, a former Eagle Scout, recently announced a $25 million gift to the Circle Ten Council of the Boy Scouts of America.
Lawsuit reform
At the state level, Rees-Jones has given generously this year to several GOP-aligned groups, including $250,000 to Texans for Lawsuit Reform, a group that advocates limits on lawsuit awards.
He gave $150,000 to Associated Republicans of Texas, a group that works to preserve the GOP majority in the Texas Legislature, as well as $100,000 to the re-election effort of Gov. Rick Perry.
Several people who know Rees-Jones said they don't think he has a particular agenda beyond electing pro-business Republicans. Chief Oil & Gas has never hired its own lobbyist in Washington, according to House lobbying records.
At a recent conference on natural gas at the George W. Bush Presidential Center, Rees-Jones talked about Chief's efforts to work with landowners whose property is needed for drilling. But he stayed away from political subjects such as environmental regulation.
"You are looking at a guy who is financially powerful and he's a smart guy, and you're lucky to have those kinds of people involved," Pickens said.
"So I think you are going to see more of Trevor in the future. It isn't a one-off deal." HEFTY GIFTS Top Texas individual and corporate donors to American Crossroads: Contributor Company City Amount Bob Perry Perry Homes Houston $7 million Robert Rowling TRT Holdings Inc. Dallas $4.8 million Trevor Rees-Jones Chief Oil & Gas Dallas $2 million Harold Simmons Dixie Rice Agricultural Corp. and Southwest Louisiana Land LLC Dallas $2 million Al G. Hill Jr. A.G. Hill Partners Dallas $100,000