Gloria's Ranch, L.L.C. v. Tauren Exploration, Inc., Cubic Energy, Inc., Wells Fargo Energy Capital, Inc., and Exco…

Summary

The court held that a mortgagee holding only security and derivative interests in a mineral lease is neither an owner under Mineral Code article 207 nor a lessee under article 140, and therefore is not liable for the lessee's failure to release the lease or pay royalties. It held Tauren solidarily liable because, under the facts, releasing the lease was an indivisible obligation, construed article 140 to cap royalty damages at twice the unpaid royalties, and reduced appellate attorney fees accordingly. Weimer, concurring in part and dissenting in part, considered the indivisibility discussion unnecessary and would have found the appellate attorney-fee award excessive; Genovese, dissenting in part, would have affirmed an award of unpaid royalties plus double that amount as a penalty.