Investor Group Demands Texas Pacific Land Trustees David Barry And John Norris Recognize Eric Oliver As Third Trustee
Strongly worded letter here. There is a material probability that this could all go very south for the Trustees. That said, Trustee actions have defied logic for months now. My guess is that these guys are far away from resolution.
Eric Oliver has been elected as TPL’s third Trustee, and you are required to recognize him as such. Given your utter disregard of your basic contractual and fiduciary obligations as trustees under the TPL declaration of trust, and the excesses you have engaged in as it relates to your power and authority under such document, we intend to hold you personally liable for your actions.
With each further action you take from this point on to prevent Eric Oliver from undertaking his responsibilities as Trustee, you are creating incremental personal liability for yourselves. All the wasteful expenses you are incurring—purportedly on behalf of the Trust—will be reimbursed by you to TPL’s beneficiaries.
4 thoughts on “White Card Stays on Offense”
Can I assume that the Court mandated face-to-face June 14th meeting didn’t go well?
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Some general comments after talking to my lawyer brother (who also owns a few shares.)
He thinks the two sides are quite far apart. The trustees don’t want Eric Oliver ever, and the HK/Softvest side will accept nothing short of total victory. Egos are larger than he anticipated. But he also says the judge’s order for a status report may still force a last minute settlement by the 6/21 due date. Judges will often offer informal guidance to both sides, when its clear one side has the advantage that will most likely prevail at trial. I have my bias here and believe HK /Softvest is more right, but that’s just an opinion and I am not the judge.
He also said the turning up of the heat strategy suggests more heat will be coming, and they have a plan to control the message and keep the trustees on the defensive with the 6/21 date looming. The latest letter was the strongest yet.
The trustees probably have what is called Professional Liability insurance, or E & O insurance, for Errors and Omissions in their capacity of being trustees, paid for by TPL. They might, being lawyers also have their own related insurance individually. The key my brother says is how large are the policies. Common denominations are in 1 million increments. For fun, he looked up what 5 million in coverage would cost, and thats roughly about 8K a year, per person.
Given the increasingly strong language, the trustees should have some worries on their professional liability. They know what their limits are, and this could be quite expensive and exceed their policies. My brother says its possible HK / Softvest is not willing to negotiate with the trustees and is expecting reimbursement, even if Oliver is allowed to be seated.
An interesting legal term on Professional Liablility insurance is “reasonable business judgment”. The liability insurance companies will cover reasonable decisions made, but if they feel a trustee made egregiously bad choices, then they may refuse to pay. Which can lead to lawsuits of the individual vs their Professional Liability corporation.
Would any insurance company say the trustees have shown “reasonable business judgement”? I have my doubts, their actions seem reckless, willfull and intentional, especially the last minute lawsuit.
The next couple of days could be very interesting.
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Super helpful Ted. Thank you! Your insights and brothers consulting are greatly appreciated!
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