While it’s unlikely to make a difference, I sent a personal message via the contact form on the TPL website expressing how disappointed we are with the possibility of dilution of current shareholders and the stock price freefall we’re currently experiencing. We’re very long-term holders of TPL (more than 20 years!) and have used the proceeds to pay for all 4 of our children’s college educations and charitable work that we’re involved in locally in the US and around the world – it’s amazing to see these funds (with no capital gains) be used to transform lives around the world. We’ve stomached the volatility for many years, but this last year has been insane.
In the message I asked them to consider providing some information/encouragement to the market/stockholders as to their plans for the split/dividend and intentions for the additional authorized shares to stop the freefall. Perhaps a groundswell of personal messages regarding what this investment means personally to investors will infuse some humanity into their hearts? Some transparency with their intentions either way would be helpful and could be the start of rebuilding trust with the shareholder community – I realize I’m a dreamer and and idealist, but it’s good to hold on to hope.
We connected to this blog just in the past year or 2 and we’re so grateful for how it has illuminated the situation for us. We still believe TPL has a positive long-term future if we can hold out through the mess that the next year will bring. We were so hopeful that the resolution to the lawsuit would be positive for TPL… too bad.
I’d be interested if they reply to you. I’m a third generation holder and have trimmed my stake considerably in the last year due to management. I have also reached out (I own thousands of shares) and have never heard one word back.
Does anyone know when Horizon Kinetics is doing their next investor call so we may be able to hear their take on TPL and plan going forward and whether they are still a believer in long term value?
Thank you for submitting a question. Hopefully Murray is now unbound from the stockholder agreement (though he is not allowed to make disparaging remarks about TPL) and can finally speak in detail about his largest investment. God forbid if he ever started to bail out, but a vote of his long-term confidence in TPL would be huge for us to hear.
Let’s be honest here.
Love Murray Stahl and Eric Oliver and how they have fought for all stockholders.
However, I have read the court decision from Delaware and am completely baffled how they (and their lawyers) could have been so completely incompetent as to NOT include a provision in their agreement whereby they explicitly could vote AGAINST dilutive share issuances!!!!!!!
They left it (at best) ambiguous, and the court crushed them, including ruling that they have to pay TPL’s legal expenses!
Further, the court gave a terrible slap at both Stahl and Oliver by calling parts of their testimony “not credible”–which comes close to calling them liars. See pages 11, 16, and 40 of court decision.
I do not agree with the court’s decision, and I think Stahl and Oliver are the good guys here.
But they put themselves in a terrible position, and they have themselves largely to blame for that, sadly.
I listened to the roundtable with Murray this morning. Since its positive I don’t see anything wrong with posting what I heard. This is just a summary of the TPL portion.
He started off by stating TPL is a great company but not the greatest. He said there is no way to know the greatest company unless you compare every company in the world.
He said agrees with many issues with TPL and there are only a few things he disagrees.
Murray then mentioned two keys that an average company should have longevity and be capital light. Longevity basically the strategy won’t change much over time. Capital light very little labor/capital expense overhead costs.
TPL has both longevity and they are capital light. So they should be profitable for the long term.
Someone asked if he would appeal the court case and he said that was private.
He also said that he can’t answer anything about the stock split.
He also mentioned that Horizon is still purchasing TPL.
Hopefully I didn’t butcher my paraphrasing what I heard during the meeting.
After hearing that I plan on adding more TPL on the dips. But that is just me, everyone has to evaluate what is best way to invest their savings.
SteveK, Thanks for the update. Great to hear Stahl is still talking up TPL and sounds like he still has a long-term positive outlook. Perhaps he can find a way to appeal or stall progress enough on Prop 4 issuances of shares until we have a chance to vote out the complicit directors at the 2024 meeting. I also hope he can influence how the stock split is executed to reduce any tax implications.
For the Murray Stahl roundtable discussion I don’t think you can join that investor call unless you are an investor, I was barely added to that group. I was added by the Regional account executive because I got my company to add Horizon Kinetics KSCOX fund to our 401k plan. That was a long process with Vanguard dragging its feet to allow an outside fund to be added to our company plan.
They do post quarterly commentaries for everyone here https://horizonkinetics.com/whats-new/. Also searching on Youtube for Murray Stahl, James Davalos, and Steve Bregmen of Horizon have some good interviews on their investment philosophy which is great education and I’m still learning from watching their interviews.
Lots of good information listening to their past commentaries and interviews.
Before I saw your response I sent a request via the contact form on the HK website and they just sent me a link to register! Looking forward to participating on Thursday! Thanks for the links too.
Interesting. I checked Simplywallstreet and Murray Stahl was purchasing TPL stock almost daily but has not purchased any since September 14, 2023. I didn’t notice that before.
It shows Donald Cook bought $8,666 (5 shares) of TPL on November 6th, 2023. Donald is listed as independent trustee. Rhys Best bought $126,186 (75 shares) on November 19th, 2023. Rhys is listed as independent chair. Michael Dobbs sold 100 shares on September 7th, 2023 $185,177 (100 shares) of TPL. It says that Michael Dobbs is Senior VP.
This is just an observation. Don’t know if it means anything but interesting to see who is purchasing shares, who is holding, and who is selling shares of TPL that are on the board or management.
From what I recall Murray mentioned in an interview that he has never sold a share of TPL in the 40 years or so years that he has owned it. From what I can see it shows him holding but not purchasing more TPL shares.
It shows that Horizon Kinetics was still purchasing share on 12/4/23 and has not sold any shares of TPL.
Not sure how accurate Simply Wall Street and Tikr website are but that it what I used to check this information.
It’s easy to blame it on management but the stock still doesn’t screen cheap. Still trading at 25x P/E. If oil heads to $40-50, no reason why TPL wouldn’t decline 50%+ from here. All shareholders should at least be aware of this big picture context.
Absolute P/E isn’t that helpful a metric for a company running at a 50% ROIC. (As my ex-boss Steve Cohen used to say, “Valuation isn’t a catalyst.”) I can fairly easily get to a $1800+ value range based on FCF.
It does raise the question — playing devil’s advocate here — whether when the price was $2,500+, might using shares for M&A have been the highest use of capital, even though it runs against the firm’s history?
SB and MS highlight that TPL isn’t a direct play on WTI. But with roughly 70% of revenue deriving from production royalties TPL would be negatively affected if oil craters. And royalties are the source of the highest incremental margins.
I did some research into the appeal system for the Delaware Court system and learned a few things. I wanted to learn the process and time involved if an appeal was filed.
There isn’t a Delaware Supreme Chancery Court. Appeals of Court of Chancery cases go to the Delaware Supreme Court.
In civil cases, you appeal to the Delaware Supreme Court final orders issued by the judge of the Court of Chancery. You can also appeal criminal cases that involve imprisonment of more than one month.
The Delaware Supreme Court is primarily an Appeals Court. It’s not a new trial, the appeal can only deal with issues and evidence already brought up in the trial record and argument briefs. Often, but not always oral arguments will be made. This is in addition to the written briefs from each side as part of the appeal process. There is no jury, and usually a 3 judge panel will decide the case. On very high profile appeals, or places where a decision will potentially make a new precedent, there will be a 5 judge panel.
The Delaware Supreme Court is known for being a speedy appellate court. Recent history shows the Court’s appeals were decided on an average of 29 days from the date of submission to the date of final decision.
My opinion is the great majority of cases decided quickly are going to be single issue, simple cases where the appeal concerns a fairness/equity issue, or an interpretation of a law or justice process.
The TPL/HK-SV case is far from a simple case.
I found on the Delaware Supreme Court web site the information below, which suggests complex litigation can mean a lengthy appeal process.
“The Court also met its performance measure for the disposition of 75% of all cases within 290 days of the date of filing a notice of appeal, exceeding this objective by disposing of 87% of all cases within that timeframe.”
Thus, 13% of cases will take longer than 290 days, or 9 1/2 months.
It’s ironic that we were worried TPL would appeal when they would inevitably lose the case (and waste millions more in legal fees) but now Stahl/Oliver are in the difficult position of having to decide whether to pursue an appeal. Them having to vote for Prop 4 is bad enough but being required to pay TPL’s legal fees is a really tough blow. I used to live in Delaware and had always heard that the reason so many Fortune 500s incorporate there is because the legal system there is skewed very favorably towards the corporations.
I remember at the trial in April that the judge sarcastically remarked that he welcomed and expected the loser of this highly complex case to appeal. He made a horrible decision in my view for shareholders that could have long-term impact.
I realize there have been some board changes. I’m trying to get score for who is most likely to vote in line with HK going forward. Could someone who is more familiar with the board members help shine some light on this? On a scale of 1-10 (Murray being a 10 in terms of shareholder orientation and former Barry being a 0), do we have ranks for the rest?
I’m concerned, as some of you have mentioned, that the board members do not own enough to give a hoot about dilutive acquisitions.
– Rhys Best: ?
– Eric Oliver: 10
– Murray Stahl: 10
– Don Cook: ?
– Barb Duganier: ?
– Tyler Glover: ? (I have a feeling I know but want to hear others opinions)
– Donna Epps: ?
– Karl Kurz: ?
– Marg Woung-Chapman: ?
– Rob Roosa: ?
Glover appears most likely to benefit from empire building. Cook was B&N’s second hand picked choice to replace MM as trustee after his death. Cook was Oliver’s competition in the blue white card war. So these along with the now gone Dana were most likely aligned with B&N in the cabal of misery.
The other incumbent board members not named EO and MS are probably go along to get alongs. Shareholder friendly when it was easy. All but the two new ones voted to sue.
Glover could go down in the history books as a long tenured CEO that guided an ROE monster, multi bagger to the stratosphere. He’d be the stuff of legends. I don’t understand why he doesn’t appreciate that.
I worked in a lab doing models for fisheries population dynamics. A guy I worked with and I were two of the top 20 in the field. Our lives were good we did what we wanted got paid well. The director of the lab retired, this other guy went for that position. We both knew it was a mistake to take on boss issues, but sometimes you can’t resist empire building. He got the job I left for another lab, he ended up in meetings and miserable.
I’d argue he could get more wealthy as CEO of the capital return rocket ship than the scrappy acquisition shit co but his buddies all probably do deals so that’s the draw. Cultural norms and all that.
It would be different if the empire convinced a majority of shareholders of their plan. But they use legal wrangling to control an unhappy owner to go against a majority. That’s what upsets me.
I agree. The departure of Barry and Oddjob creates an opportunity for the new look board to reset the narrative. Instead of clinging on to the old cloaked ways of the Trust (which were clearly so cosy or worse murky they feared any kind of legal discovery), they can move into a more open healthy present. Not least because the company has evolved into a multi-billion dollar concern over the past seven years.
It really isn’t complicated. Wipe the slate clean. Start afresh with a new open approach that respects the shareholders enough to outline any drastic plans or grand vision upfront. If you don’t have enough faith in your plan to sell it to shareholders first, then why would the shareholders believe in it? 18 deals for zero sums up the Barry Empire Scheme. Here’s to more communication from the new team.
So what’s the timeline for HK/Softvest paying the exorbitant legal fees that TPL incurred in the litigation?
If that isn’t paid directly out to as a special dividend as at least a small token of good faith to shareholders, this management is well and truly lost.
From the rules of the court on the Delaware Court of Chancery web site, “Delaware follows the ‘American Rule,’ whereby a prevailing party is generally expected to pay its own attorney’s fees and costs.”.
The American Rule basically means if you hire an inexpensive lawyer or a white shoe large firm, thats your decision. Your choice on counsel, your legal costs.
Doing some research shows that if legal expenses are ordered to be paid to the prevailing party, they explicitly say that in the Chancery Court ruling opinion. I found several ruling opinions in other cases where legal fees were ordered. If you have a meritless case and try to use the courts to subdue the other side, the court will send a message they don’t appreciate, and penalize appropriately.
We don’t see that here. This legal case has two sides which have defendable merit. The Court ruling in the opinion says “ The Company is entitled to an award of costs as the prevailing party.” Costs are not legal expenses, there is a clear distinction between costs and other expenses including legal.
What are costs? Courtroom costs, filing fees, transcription costs by court reporters, docketing fees for each item entered into the record, subpoenas, etc. I would be surprised if this was more than 25k. Double that if I’m wrong, it’s not significant when compared to your own legal costs.
Any decision to appeal to the Delaware Supreme Court comes with the risk of their opinion still going against you and the risk of the other side being awarded legal expenses, especially if they think your appeal is weak and the lower court made an easy and correct decision.
So, it’s a tradeoff. Can the threat of appeal be used in negotiations regarding the appeal? I believe this is a complex case and would take 6-9 months to finish the appeal process. This could be a factor for voting at the 2024 annual meeting on directors up for re-election. A vote unconstrained HK/SV could be able to vote any way they want before an appeal decision is made.
Also difficult to handicap is the right to call a special meeting. If the board approves this, then a special meeting might happen before the next annual meeting and attempt to remove many anti-shareholder directors.
We will know by the end of December if an appeal is going to happen, they have 30 days to do so our lose the right of appeal.
The Texas Pacific Land Trust Investor 
Over 2 Billion evaporated over more stupidity. When will management act like owners?..
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Management is loving this. Stock option set lower prices.
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While it’s unlikely to make a difference, I sent a personal message via the contact form on the TPL website expressing how disappointed we are with the possibility of dilution of current shareholders and the stock price freefall we’re currently experiencing. We’re very long-term holders of TPL (more than 20 years!) and have used the proceeds to pay for all 4 of our children’s college educations and charitable work that we’re involved in locally in the US and around the world – it’s amazing to see these funds (with no capital gains) be used to transform lives around the world. We’ve stomached the volatility for many years, but this last year has been insane.
In the message I asked them to consider providing some information/encouragement to the market/stockholders as to their plans for the split/dividend and intentions for the additional authorized shares to stop the freefall. Perhaps a groundswell of personal messages regarding what this investment means personally to investors will infuse some humanity into their hearts? Some transparency with their intentions either way would be helpful and could be the start of rebuilding trust with the shareholder community – I realize I’m a dreamer and and idealist, but it’s good to hold on to hope.
We connected to this blog just in the past year or 2 and we’re so grateful for how it has illuminated the situation for us. We still believe TPL has a positive long-term future if we can hold out through the mess that the next year will bring. We were so hopeful that the resolution to the lawsuit would be positive for TPL… too bad.
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I’d be interested if they reply to you. I’m a third generation holder and have trimmed my stake considerably in the last year due to management. I have also reached out (I own thousands of shares) and have never heard one word back.
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We also own thousands of shares across 3 generations and we are very slowly divesting.
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I also sent a message through the website today.
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I also wrote them a message today (1000+ shares). I figure the Cowboys will win another Superbowl before they get back to me.
I still think shareholders are winning, its just not a full on rout.
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the one and only thing that gives me faith in this is that HK is still buying shares (at least as of yesterday – 3 shares at 1597.16
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Does anyone know when Horizon Kinetics is doing their next investor call so we may be able to hear their take on TPL and plan going forward and whether they are still a believer in long term value?
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Horizon Kinetics is doing their next investor call on 12/14/23 Roundtable discussion with Murray Stahl 11:30 AM EST.
I sent an email question for the meeting on their thoughts about the court ruling and what they plan to do for the long term with TPL.
They have acknowledged my question and will ask Murray it in the meeting maybe it will be phrased differently.
Not sure how Murray Stahl will answer that.
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Thank you for submitting a question. Hopefully Murray is now unbound from the stockholder agreement (though he is not allowed to make disparaging remarks about TPL) and can finally speak in detail about his largest investment. God forbid if he ever started to bail out, but a vote of his long-term confidence in TPL would be huge for us to hear.
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Let’s be honest here.
Love Murray Stahl and Eric Oliver and how they have fought for all stockholders.
However, I have read the court decision from Delaware and am completely baffled how they (and their lawyers) could have been so completely incompetent as to NOT include a provision in their agreement whereby they explicitly could vote AGAINST dilutive share issuances!!!!!!!
They left it (at best) ambiguous, and the court crushed them, including ruling that they have to pay TPL’s legal expenses!
Further, the court gave a terrible slap at both Stahl and Oliver by calling parts of their testimony “not credible”–which comes close to calling them liars. See pages 11, 16, and 40 of court decision.
I do not agree with the court’s decision, and I think Stahl and Oliver are the good guys here.
But they put themselves in a terrible position, and they have themselves largely to blame for that, sadly.
It hurts all of us TPL shareholders.
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JP,
I listened to the roundtable with Murray this morning. Since its positive I don’t see anything wrong with posting what I heard. This is just a summary of the TPL portion.
He started off by stating TPL is a great company but not the greatest. He said there is no way to know the greatest company unless you compare every company in the world.
He said agrees with many issues with TPL and there are only a few things he disagrees.
Murray then mentioned two keys that an average company should have longevity and be capital light. Longevity basically the strategy won’t change much over time. Capital light very little labor/capital expense overhead costs.
TPL has both longevity and they are capital light. So they should be profitable for the long term.
Someone asked if he would appeal the court case and he said that was private.
He also said that he can’t answer anything about the stock split.
He also mentioned that Horizon is still purchasing TPL.
Hopefully I didn’t butcher my paraphrasing what I heard during the meeting.
After hearing that I plan on adding more TPL on the dips. But that is just me, everyone has to evaluate what is best way to invest their savings.
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SteveK, Thanks for the update. Great to hear Stahl is still talking up TPL and sounds like he still has a long-term positive outlook. Perhaps he can find a way to appeal or stall progress enough on Prop 4 issuances of shares until we have a chance to vote out the complicit directors at the 2024 meeting. I also hope he can influence how the stock split is executed to reduce any tax implications.
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Is it possible to join this investor call if you’re not an investor in HK funds? Do you have that information? Thanks for your help.
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Familyinvestor,
For the Murray Stahl roundtable discussion I don’t think you can join that investor call unless you are an investor, I was barely added to that group. I was added by the Regional account executive because I got my company to add Horizon Kinetics KSCOX fund to our 401k plan. That was a long process with Vanguard dragging its feet to allow an outside fund to be added to our company plan.
They do post quarterly commentaries for everyone here https://horizonkinetics.com/whats-new/. Also searching on Youtube for Murray Stahl, James Davalos, and Steve Bregmen of Horizon have some good interviews on their investment philosophy which is great education and I’m still learning from watching their interviews.
Lots of good information listening to their past commentaries and interviews.
LikeLiked by 1 person
Before I saw your response I sent a request via the contact form on the HK website and they just sent me a link to register! Looking forward to participating on Thursday! Thanks for the links too.
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What are the consequences of HK/SV filing an appeal? Does that temporarily block the issue of new shares?
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If they want to dilute the shares 20%, I can foresee the share price dropping 20% for parity. Shame.
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https://ir.stockpr.com/tpltrust/sec-filings-email/content/0001056823-23-000058/formsc13da.htm
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Interesting. I checked Simplywallstreet and Murray Stahl was purchasing TPL stock almost daily but has not purchased any since September 14, 2023. I didn’t notice that before.
It shows Donald Cook bought $8,666 (5 shares) of TPL on November 6th, 2023. Donald is listed as independent trustee. Rhys Best bought $126,186 (75 shares) on November 19th, 2023. Rhys is listed as independent chair. Michael Dobbs sold 100 shares on September 7th, 2023 $185,177 (100 shares) of TPL. It says that Michael Dobbs is Senior VP.
This is just an observation. Don’t know if it means anything but interesting to see who is purchasing shares, who is holding, and who is selling shares of TPL that are on the board or management.
From what I recall Murray mentioned in an interview that he has never sold a share of TPL in the 40 years or so years that he has owned it. From what I can see it shows him holding but not purchasing more TPL shares.
It shows that Horizon Kinetics was still purchasing share on 12/4/23 and has not sold any shares of TPL.
Not sure how accurate Simply Wall Street and Tikr website are but that it what I used to check this information.
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You can see the form 4 for Murray Stahl and the 13D for Horizon kinetics in the SEC filings on the TPL Website.
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Leonard appreciate the follow up and information. I missed checking the TPL website.
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It’s easy to blame it on management but the stock still doesn’t screen cheap. Still trading at 25x P/E. If oil heads to $40-50, no reason why TPL wouldn’t decline 50%+ from here. All shareholders should at least be aware of this big picture context.
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Absolute P/E isn’t that helpful a metric for a company running at a 50% ROIC. (As my ex-boss Steve Cohen used to say, “Valuation isn’t a catalyst.”) I can fairly easily get to a $1800+ value range based on FCF.
It does raise the question — playing devil’s advocate here — whether when the price was $2,500+, might using shares for M&A have been the highest use of capital, even though it runs against the firm’s history?
SB and MS highlight that TPL isn’t a direct play on WTI. But with roughly 70% of revenue deriving from production royalties TPL would be negatively affected if oil craters. And royalties are the source of the highest incremental margins.
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On the positive side dividend reinvestments will get more shares this go around.
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From the SEC filings HK continues small purchases daily. I sure wish someone would give some definitive information!
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http://archive.fast-edgar.com/20231206/ATVZ322CZ222L2Z2222A22Z4PU5EZR222I52
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I did some research into the appeal system for the Delaware Court system and learned a few things. I wanted to learn the process and time involved if an appeal was filed.
There isn’t a Delaware Supreme Chancery Court. Appeals of Court of Chancery cases go to the Delaware Supreme Court.
In civil cases, you appeal to the Delaware Supreme Court final orders issued by the judge of the Court of Chancery. You can also appeal criminal cases that involve imprisonment of more than one month.
The Delaware Supreme Court is primarily an Appeals Court. It’s not a new trial, the appeal can only deal with issues and evidence already brought up in the trial record and argument briefs. Often, but not always oral arguments will be made. This is in addition to the written briefs from each side as part of the appeal process. There is no jury, and usually a 3 judge panel will decide the case. On very high profile appeals, or places where a decision will potentially make a new precedent, there will be a 5 judge panel.
The Delaware Supreme Court is known for being a speedy appellate court. Recent history shows the Court’s appeals were decided on an average of 29 days from the date of submission to the date of final decision.
My opinion is the great majority of cases decided quickly are going to be single issue, simple cases where the appeal concerns a fairness/equity issue, or an interpretation of a law or justice process.
The TPL/HK-SV case is far from a simple case.
I found on the Delaware Supreme Court web site the information below, which suggests complex litigation can mean a lengthy appeal process.
“The Court also met its performance measure for the disposition of 75% of all cases within 290 days of the date of filing a notice of appeal, exceeding this objective by disposing of 87% of all cases within that timeframe.”
Thus, 13% of cases will take longer than 290 days, or 9 1/2 months.
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Thank you Ted!
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It’s ironic that we were worried TPL would appeal when they would inevitably lose the case (and waste millions more in legal fees) but now Stahl/Oliver are in the difficult position of having to decide whether to pursue an appeal. Them having to vote for Prop 4 is bad enough but being required to pay TPL’s legal fees is a really tough blow. I used to live in Delaware and had always heard that the reason so many Fortune 500s incorporate there is because the legal system there is skewed very favorably towards the corporations.
I remember at the trial in April that the judge sarcastically remarked that he welcomed and expected the loser of this highly complex case to appeal. He made a horrible decision in my view for shareholders that could have long-term impact.
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I realize there have been some board changes. I’m trying to get score for who is most likely to vote in line with HK going forward. Could someone who is more familiar with the board members help shine some light on this? On a scale of 1-10 (Murray being a 10 in terms of shareholder orientation and former Barry being a 0), do we have ranks for the rest?
I’m concerned, as some of you have mentioned, that the board members do not own enough to give a hoot about dilutive acquisitions.
– Rhys Best: ?
– Eric Oliver: 10
– Murray Stahl: 10
– Don Cook: ?
– Barb Duganier: ?
– Tyler Glover: ? (I have a feeling I know but want to hear others opinions)
– Donna Epps: ?
– Karl Kurz: ?
– Marg Woung-Chapman: ?
– Rob Roosa: ?
Thanks for any help!
Sincerely,
Owner of +20k shares.
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Glover appears most likely to benefit from empire building. Cook was B&N’s second hand picked choice to replace MM as trustee after his death. Cook was Oliver’s competition in the blue white card war. So these along with the now gone Dana were most likely aligned with B&N in the cabal of misery.
The other incumbent board members not named EO and MS are probably go along to get alongs. Shareholder friendly when it was easy. All but the two new ones voted to sue.
IMO
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Thanks! very helpful.
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Glover could go down in the history books as a long tenured CEO that guided an ROE monster, multi bagger to the stratosphere. He’d be the stuff of legends. I don’t understand why he doesn’t appreciate that.
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I worked in a lab doing models for fisheries population dynamics. A guy I worked with and I were two of the top 20 in the field. Our lives were good we did what we wanted got paid well. The director of the lab retired, this other guy went for that position. We both knew it was a mistake to take on boss issues, but sometimes you can’t resist empire building. He got the job I left for another lab, he ended up in meetings and miserable.
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I’d argue he could get more wealthy as CEO of the capital return rocket ship than the scrappy acquisition shit co but his buddies all probably do deals so that’s the draw. Cultural norms and all that.
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IMO, Glover puts a dark stain on the title of CEO.
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It would be different if the empire convinced a majority of shareholders of their plan. But they use legal wrangling to control an unhappy owner to go against a majority. That’s what upsets me.
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I agree. The departure of Barry and Oddjob creates an opportunity for the new look board to reset the narrative. Instead of clinging on to the old cloaked ways of the Trust (which were clearly so cosy or worse murky they feared any kind of legal discovery), they can move into a more open healthy present. Not least because the company has evolved into a multi-billion dollar concern over the past seven years.
It really isn’t complicated. Wipe the slate clean. Start afresh with a new open approach that respects the shareholders enough to outline any drastic plans or grand vision upfront. If you don’t have enough faith in your plan to sell it to shareholders first, then why would the shareholders believe in it? 18 deals for zero sums up the Barry Empire Scheme. Here’s to more communication from the new team.
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So what’s the timeline for HK/Softvest paying the exorbitant legal fees that TPL incurred in the litigation?
If that isn’t paid directly out to as a special dividend as at least a small token of good faith to shareholders, this management is well and truly lost.
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It’s court costs I am told. Not all legal fees.
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That is my interpretation also.
From the rules of the court on the Delaware Court of Chancery web site, “Delaware follows the ‘American Rule,’ whereby a prevailing party is generally expected to pay its own attorney’s fees and costs.”.
The American Rule basically means if you hire an inexpensive lawyer or a white shoe large firm, thats your decision. Your choice on counsel, your legal costs.
Doing some research shows that if legal expenses are ordered to be paid to the prevailing party, they explicitly say that in the Chancery Court ruling opinion. I found several ruling opinions in other cases where legal fees were ordered. If you have a meritless case and try to use the courts to subdue the other side, the court will send a message they don’t appreciate, and penalize appropriately.
We don’t see that here. This legal case has two sides which have defendable merit. The Court ruling in the opinion says “ The Company is entitled to an award of costs as the prevailing party.” Costs are not legal expenses, there is a clear distinction between costs and other expenses including legal.
What are costs? Courtroom costs, filing fees, transcription costs by court reporters, docketing fees for each item entered into the record, subpoenas, etc. I would be surprised if this was more than 25k. Double that if I’m wrong, it’s not significant when compared to your own legal costs.
Any decision to appeal to the Delaware Supreme Court comes with the risk of their opinion still going against you and the risk of the other side being awarded legal expenses, especially if they think your appeal is weak and the lower court made an easy and correct decision.
So, it’s a tradeoff. Can the threat of appeal be used in negotiations regarding the appeal? I believe this is a complex case and would take 6-9 months to finish the appeal process. This could be a factor for voting at the 2024 annual meeting on directors up for re-election. A vote unconstrained HK/SV could be able to vote any way they want before an appeal decision is made.
Also difficult to handicap is the right to call a special meeting. If the board approves this, then a special meeting might happen before the next annual meeting and attempt to remove many anti-shareholder directors.
We will know by the end of December if an appeal is going to happen, they have 30 days to do so our lose the right of appeal.
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