Blue Ribbon Panel to Explore C-Corp Conversion

Texas Pacific Land Trust Forms Conversion Exploration Committee to Consider C-Corp Conversion

Mayor Larry Vaughn of Amity Island forms committee to explore nuisance fish.  

Venezuelian President Maduro calls for fair and honest elections.

In all seriousness, while this appears to be a step in the right direction, this is a troll attempt.

McGinnis is on record as being Blue card friendly.  Cook is being put into the position to vote himself out of a potetional job (though he already lost the election).  This lineup is so obviously preposterous (4 out of 5 house votes), that one has to conclude the goal of this press release was to antagonize the “dissidents” and holders that actually have capital at stake.  You know, more than 300 shares.

If they really cared about C-corp they would put it to a shareholder vote immediately.

The Conversion Exploration Committee will evaluate, from a corporate, corporate governance, tax, accounting and business perspective, whether the Trust should be converted into a C-corp or, in the alternative, whether the Trust should remain a business trust (with potential amendments to the declaration of trust). The Conversion Exploration Committee will begin its work this week. While the process is expected to take several months, the Conversion Exploration Committee will make a recommendation to the Trust as soon as practicable.

The members of the Conversion Exploration Committee are:

  • John R. Norris III, incumbent Trustee
  • David E. Barry, incumbent Trustee
  • Four-Star General Donald Cook, USAF (Ret.)
  • Dana McGinnis, Founder and Chief Investment Officer of Mission Advisors, one of the Trust’s largest shareholders

The Trust also invites Horizon Kinetics to designate a person of its choosing as the fifth member of the Conversion Exploration Committee.

 

 

12(c)

WINNING WITHOUT TRIAL: RULE 12(C) MOTIONS FOR JUDGMENT ON THE PLEADINGS

See Ted’s excellent reply to the last post for context around 12c in this case. Highligting is mine.

Experienced practitioners are familiar with Federal Rule of Civil Procedure 12, which provides for various pretrial motions to challenge the opposing party’s pleadings and to assert other defenses and objections. If asking attorneys what type of pretrial challenges they consider to be part of their arsenal of motions challenging the adequacy of the pleadings, their response likely would be limited to motions to dismiss for failure to state a claim, motions to strike, or motions for summary judgment. Rule 12(c) motions—allowing a party to move, after the pleadings are closed, for judgment on the pleadings—are often overlooked. Practitioners, however, should consider and incorporate Rule 12(c) motions into their litigation strategies.

Motions for judgment on the pleadings are essentially trials on the pleadings. Rule 12(c) was designed to prevent the piecemeal process of judicial determination that prevailed under the old common law practice.2 It allows for a decision on the merits of the claims based upon the pleadings in special circumstances, such as when the parties do not dispute the facts in the pleadings. Thus, Rule 12(c) motions can help dispose of baseless claims or defenses when the formal pleadings reveal their lack of merit. Because a motion for judgment on the pleadings can highlight for the court its ability to resolve the case, merely by examining the initial papers,3 its use can mean the difference between unnecessarily protracted litigation and a prompt resolution of the dispute. As one author described a winning motion practice, albeit in the context of summary judgment:

[w]ith one successful roll of the . . . dice, an attorney can win the trial-court round, put an opponent on the defensive, save time and money that would be spent in court, and emerge a hero to the client. Used correctly and shrewdly, [a dispositive motion] is a lethal weapon that can resolve lengthy, expensive, and exhausting litigation years before a case reaches the trial stage.4

 

 

 

6/21 Case Management Plan

Joint Discovery / Case Management Plan

Plaintiffs’ Position: As stated above in Plaintiffs’ Positions in paragraphs 4 and 6(a), the PSLRA discovery stay does not apply to this case and there is no reason to delay scheduling trial. Indeed, at the Rule 26(f) conference, the Parties discussed and agreed to a trial date in the summer of 2020. Accordingly, Plaintiffs respectfully request a trial on August 31, 2020, or on a date thereafter convenient to the Court and anticipate that the trial will take a total of eighty (80) hours divided evenly between the sides. Neither side has demanded a jury trial.

I’m no lawyer. Would love to hear your thoughts on this as you read it.

Also, reading the Plaintiff’s Position makes me want to puke.

Motion to Extend

AGREED JOINT MOTION FOR EXTENSION OF TIME

Plaintiffs Texas Pacific Land Trust and, solely in their respective capacities as trustees for Texas Pacific Land Trust, David E. Barry and John R. Norris III (collectively, “Plaintiffs”) and Defendant Eric L. Oliver (“Defendant”) hereby file this Agreed Joint Motion for Extension of Time.

On June 17, 2019, Defendant filed a Fed. R. Civ. P. 12(c) Motion for Judgment on the Pleadings [Dkt. 19], resulting in a deadline for Plaintiffs to respond on July 8, 2019 and a deadline for Defendant to file a reply on July 22, 2019. The Parties respectfully request a one- week extension of the deadline for Plaintiffs to respond to Defendant’s Motion, until July 15, 2019. The Parties likewise respectfully request a corresponding extension of the Defendant’s deadline to reply, to August 5, 2019.

These extensions are requested for good cause and not for the purpose of delay. Plaintiffs and Defendant agree to the requested extensions.

Texas Buildout (post modified and renamed)

U.S. refiner Phillips 66 enters offshore oil export race

The project, which is being developed with the Port of Corpus Christi, would compete with nearby shale export terminals proposed by investor Carlyle Group and commodities trader Trafigura AG. Its project would be at least the ninth project proposed for the Gulf Coast.

U.S. crude exports hit 3.12 million barrels per day (bpd) this month from zero before the U.S. lifted a ban on exports in late 2015. Shale oil from fields in Texas, Colorado, New Mexico and North Dakota is projected to push U.S. output to 12.32 million bpd this year, according to U.S. forecasts.

The facility could load up to 1.56 million bpd, nearly the capacity of a supertanker. If approved by the U.S. Maritime Administration, U.S. Coast Guard and Texas regulators, operations could begin in mid-2021, said a person familiar with its plans.

Exxon, Saudis Bet on Plastics Growth in Giant Gulf Coast Plant

Exxon Mobil Corp. and Saudi Arabia’s state-controlled petrochemicals company formally approved construction of a new chemical complex in Texas that will process production from the Permian Basin’s booming oil and natural gas wells.

The project near Corpus Christi will be the world’s largest steam cracker and create $50 billion of “economic output” in the first six years, Exxon and Saudi Basic Industries Corp., known as Sabic, said in a joint statement on Thursday. The facility will convert hydrocarbons such as ethane and propane to ethylene, a chemical used to make everything from plastics to antifreeze.

Amended Counterclaims: Barry’s Election Challenged

AMENDED COUNTERCLAIMS OF ERIC L. OLIVER, SOFTVEST, L.P., HORIZON KINETICS LLC, AND ART-FGT FAMILY PARTNERS LIMITED AGAINST DAVID E. BARRY AND JOHN R. NORRIS III

Posted to the HK TPL page today.   Thanks to a couple of blog readers for the heads up!  Looks like a big one.  As foreshadowed in White’s “Open the Books!” letter, the group is now officially contesting David Barry’s election.  See excerpt below.

In addition to newly stated facts (highlighted below), counts #2 (page 24) and #7 (page 30) appear to be new causes of action (forgive me if I’m butchering this).  #2 claims breach of Declaration of Trust for ghosting shareholders who came into Dallas to attend the 5/22 meeting.  #7 is a request to get Barry’s election OVERTURNED.

Do we need two new Trustees?

C. The SoftVest Plaintiffs Learn That One Of The Incumbent Trustees, David E.
Barry, Was Never Duly Elected

53. Following the May 22, 2019 special meeting at which Mr. Oliver was elected a TPL
trustee, the SoftVest Plaintiffs learned that one of the Incumbent Trustees, David E. Barry, had actually never been duly elected as a trustee of TPL in the first place.

54. Prior to September 27, 2016, TPL’s three trustees were James K. Norwood, Maurice
Meyer III, and John R. Norris III.

55. On September 27, 2016, Mr. Norwood passed away.

56. On November 4, 2016, Messrs. Meyer and Norris nominated Mr. Barry for election
as trustee.

57. On December 7, 2016, Messrs. Meyer and Norris formally noticed a special
shareholder meeting on January 12, 2017 to elect a new trustee and stated in the notice that only record holders of TPL shares as of December 6, 2016 would be eligible to vote. As of December 6, 2016, there were 7,929,780 TPL shares outstanding.

58. Mr. Barry was the only candidate for the new trustee position.

59. The Declaration of Trust provides that, “[i]n the event of the death . . . of any of the
trustees a successor shall be elected at a special meeting of the certificate holders by a majority in the amount of the certificate holders present in person or by proxy at such meeting whose names shall have been registered in the books of the trustees at least fifteen days before such meeting.”

60. After the meeting on January 12, 2017, TPL claimed that 6,905,319 shares were present in person or by proxy at the meeting, of which 4,421,776 (64%) voted for Mr. Barry and 2,483,543 (36%) voted against him. Horizon Kinetics was one of the shareholders to vote against the election of Mr. Barry. TPL announced that Mr. Barry was elected given that he purportedly received a majority of the votes cast in person or by proxy at the meeting.

61. As the SoftVest Plaintiffs recently learned, however, TPL’s vote count was based a
significant error and improperly included votes that were not legally cast.

62. The vast majority of beneficial owners of TPL hold their shares through brokers,
banks or custodians (“brokers”).

63. Proxy solicitations of beneficial owners are typically made through the broker, which
transmits the proxy statement to the beneficial owners. Instead of sending a proxy card, the broker sends the beneficial owners an instruction sheet that the beneficial owners can return to the broker with voting instructions.

64. Rule 452 of the NYSE, approved by the SEC, comes into play when the beneficial
owner does not instruct the broker how to vote the shares. The rule specifies the conditions under which the broker can vote the shares without having received voting instructions from the beneficial owner.

65. NYSE Rule 452 allows a broker to vote shares held in street name on “routine”
proposals if the broker’s customer, the beneficial owner of the shares, has not provided specific voting instructions to the broker at least ten days before a scheduled meeting. Shares for which no instructions are received are referred to as “uninstructed shares.”

66. But NYSE Rule 452 prohibits brokers from voting shares on “non-routine” proposals,
such as director elections, without specific voting instructions from the beneficial owner.

67. In June 2019, a representative of the New York Stock Exchange confirmed that the
2017 election in which Mr. Barry was a candidate was, at the time, erroneously classified as a “routine” proposal. That representative further confirmed that the election clearly should have been classified as a “non-routine” proposal under NYSE rules. TPL, its trustees, and its agents failed to take corrective action to notify the NYSE when they became aware prior to the scheduled meeting that such mistake had been made, and allowed the “special meeting” to invalidly proceed.

68. The “error” in how the 2017 election was classified greatly inflated the number of
votes cast for Mr. Barry in that election, because it permitted brokers to cast votes on behalf of shares that otherwise would not have voted. On information and belief, but for the error that TPL failed to correct, Mr. Barry would not have received the vote needed to claim an electoral win.

69. TPL has never taken any steps to correct this error. Upon information and belief,
because brokers typically vote in favor of uncontested company proposals, most if not all of the votes that were erroneously cast in 2017 were cast in favor of Mr. Barry; as a result, Mr. Barry did not receive a majority of the votes that were legally cast, and thus was never duly elected a TPL trustee.