Docket Update 5/31: Status Report Order

STATUS REPORT ORDER: Lead counsel for each party (or a designee attorney with appropriate authority) must meet face-to-face at a mutually agreeable location, and no later than seven (7) calendar days before the Joint Status Report due date. Status Report due by 6/21/2019. (Ordered by Judge Jane J. Boyle on 5/31/2019)


12 thoughts on “Docket Update 5/31: Status Report Order

  1. Is the point of this an attempt for a mediation? Someone with a little legal background please help translate what this means… and does this mean we will get an update by 6/21 about the suits?

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  2. Mediation is in TPL’s and everyone’s interest and could bring a quick resolution to what will otherwise be a very expensive, time consuming, and attention diverting journey and value destructive process.

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  3. Asked my brother, who is a lawyer and also owns a few shares. He says judges often will give a few weeks for the emotions to calm down, and then have the lawyers meet, with each side to provide a summary on where they are on the key points. The judge will review to see if any more time could bridge the differences.

    Its partly being pragmatic, and partly taking into account the cards you are holding and how likely you are to prevail. HK has the shareholder votes, the trustees acted badly in the fight, but its also a 130 year old trust with a 6 page charter. Its going to be complicated to sort out. And the tradeoff between not getting all you wanted, but enough of what you wanted to avoid the “roll of the dice” on how a judge might rule.

    And here is something that ought to put us all in the compromise spirit. My brother says the Federal Court systems runs longer than State court. This case was filed in the Northern district of the Federal system for Texas. The “fastest” time in the country for quite a few years in the federal system is called the “rocket docket”, with the time between file to trial being 12.3 months. Yes, this is the fastest in the country, in Virginia’s Federal court. They work hard to not delay anything, beliving a locked down trial date forces settlements.

    I could not find anything about the time between filing to trial in the Northern Texas Federal court. The average for all Federal courts is 22 months.

    And if you want to be pessimistic, the Federal decision can be appealed. On a complicated case like this, its possible there could be two different opinions on so many issues, requiring an appeal. Average time to appeal is another 17 months!

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  4. Thanks Ted. I’m always grateful it when someone can post with real insight. This could turn into a real ‘War of the Roses’ slugfest with no winners if they don’t sit and talk and figure out a compromise. Oof. What a mess.

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  5. I had more questions for my lawyer brother that I found interesting and wanted to share. Some quick background, my brother is a 30 year civil and business lawyer, and the great majority of what he is involved with does not land in Federal Court. That said, he does have some Federal Court experience. Some questions he answered directly and a few of the ones with percentages took him digging out my answers.

    Federal court is divided into three main categories of cases, Civil, Criminal and Bankruptcy. Criminal cases have a very high rate of conviction as the authorities bringing federal charges (FBI, SEC, other regulators) usually have very solid cases (ie with clear cut evidence of guilt with wiretaps, documents, the 20 kilos of drugs in your car, informants, etc)

    Civil cases see the plantiff prevail in about 30% of cases if they go to trial. Not so surprisingly, when a counter-suit is filed, 27% of those suits are successful if they go to trial. Typical on a mixed suit case is both sides will win on some parts of their case, and lose on others. Its very rare to see one side win on everything.

    For 2018, 78% of Federal civil cases that got concluded were the result of the judge dismissing the case for lack of merit, or the cases were dismissed by the parties that came to some agreement. The remaining 22% represents cases either still pending, in trial, or concluded. An interesting statistic is approximately 10% of filed Federal civil cases will ever make it to trial.

    My brother believes in spite of the civil war over the trustee fight, a negotiated settlement is the most likely outcome. The trustees are operating from weakness, and the last minute case filing shows a willingness to do anything to stop an election they were losing. HK and Softvest have the votes, but the “meeting” probably wasn’t valid.

    Most likely outcome he believes is both sides stipulate to what disclosures need to be made, what type of election process is followed, and an agreement to not unduly delay future elections by the trustees in exchange for dropping the suing of the trustees individually. Essentially a “do-over”, perhaps with less mud being tossed.
    This way the trustees still feel like winners, even if they lose, and HK / Softvest will probably prevail.

    Paradoxically, he believes a negotiated settlement is more likely because the two trustees are lawyers. They know how things really work, and are better at setting aside the personal nature of this contest than a more ego driven business person.

    The alternative Is two years of legal bills and uncertainty over what are low percentages of either party prevailing, management distraction, and not maximizing the value of TPL’s business. And longer if there are appeals.

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    • Awesome stuff. I am curious about what the SoftVest partners, HK, etc. would have as their terms of an agreement that would have to be met. I think if the trustees are demanding the questionnaire to be filled out, that Oliver and crew should demand their questions to be answered regarding the concerns of conflicts of interest. I wonder if they would agree to Murray Stahl being a trustee, and then after he got the nod to put up a vote on c Corp. then after that, hire Oliver as the CEO, Director of the Board, or something similar.

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  6. Excellent perspective, Ted. Let’s hope cool heads and cooler counsel prevails here. The key problem for me remains management’s behavior: just ridiculously aggressive and self-defeating when they could have been adroitly diplomatic. Now we have to go through the rigmarole of delaying the inevitable so they can save face. So be it. Let the do-over begin.

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