Frontier Drilling LLC v. XTO Energy, Inc.

On December 5, 2023, Beck Redden obtained summary judgment on behalf of our client XTO Energy, Inc. (a subsidiary of ExxonMobil) against allegations that XTO breached an unsigned contract amendment that the plaintiff claimed was “accepted” through a series of email exchanges.

After contracting with each other in writing for several years, the plaintiff claimed that XTO “accepted” a contract to extend a drilling rig contract via email. In previous dealings, the plaintiff and XTO management had negotiated, put in writing, and signed contracts and amendments. The series of emails at issue neither followed that practice nor set forth the terms that the plaintiff ultimately sought to enforce. During discovery, Beck Redden was able to establish the parties’ business practice and obtain key testimony to support XTO’s position that the plaintiff knew the emails at issue did not constitute a final agreement.

According to the Court, this evidence demonstrated that XTO had not consented to conduct transactions via email as required by Texas Uniform Electronic Act (“UETA”). Because the proposed contract amendment could not be performed within one year, it was required to be signed under the Texas statute of frauds. The Court granted summary judgment and dismissed the plaintiff’s case with prejudice.

The case demonstrates the importance of establishing clear protocols for conducting contract negotiations, as well as the weight that courts may place on prior practices of the parties.

The Beck Redden team was made up of partner Mark C. Rodriguez and associate Jake McClellan.

The case style is Frontier Drilling LLC v. XTO Energy, Inc., Case No. 4:22-cv-02497, in the United States District Court for the Southern District of Texas, Houston Division.