Coastal Oil & Gas Corp. and Coastal Oil & Gas USA, L.p., Petitioners v. Garza Energy Trust, Respondents

Summary

The Texas Supreme Court reversed the Court of Appeals and remanded for a new trial, holding that hydraulic fracturing that extends into another's subsurface does not constitute a trespass actionable for damages because the rule of capture bars recovery, that mineral lessors with a reversionary interest have standing to sue for subsurface trespass, that damages for breach of the implied covenant to protect against drainage are measured by the value of lost minerals (but no evidence of such value was presented), that the admission of a 1977 memo containing a racial slur was reversible error, and that the trial court did not abuse its discretion in refusing to abate the case. Justice WILLETT, concurring, emphasized the policy importance of preserving hydraulic fracturing, while Justice JOHNSON, concurring in part and dissenting in part, would have found hydraulic fracturing to be an actionable trespass and reversed the rule of capture application.