Business Court Enforces Seven-Day Summary Judgment Evidence Deadline and Parses Expectancy Versus Reliance Damages in Oil and Gas Contract Dispute
Judge Jerry D. Bullard
Decided December 22, 2025
Mem. Op.
Summary Judgment
In Slant Operating v. Octane Energy Operating, Judge Bullard granted Octane's motion to strike untimely summary judgment evidence filed one day late and granted partial summary judgment on lost revenue claims, holding that the operator plaintiff lacks standing to recover lost production damages but may proceed on redesign costs and expectancy damages. The December 22, 2025 memorandum opinion underscores strict enforcement of Rule 166a deadlines and clarifies which plaintiff entities may recover which categories of contract damages in oil and gas breach-of-contract cases.
Court Staff Summary
Granting Defendant's motion to strike untimely filed summary-judgment evidence. Granting in part and denying in part Defendant's Traditional and No-Evidence Motion for Summary Judgment. One plaintiff is not entitled to damages as a matter of law, is not entitled to lost revenue or production as a matter of law, has produced evidence of redesign costs and additional expenses incurred as a result of Defendant's breach, and the record contains evidence of that plaintiff's expectancy damages. While Plaintiffs do not allege a specific theory/category of reliance damages in their petition, the Court nonetheless addresses Defendant’s argument and holds that the plaintiff has not produced evidence of reliance damages.
Background: Off-Lease Drilling Waivers Between Operators
Slant Operating, LLC and Slant WTX Holdings II, LLC sued Octane Energy Operating, LLC over a February 22, 2023 letter agreement governing reciprocal waivers of objections to off-lease penetration point permit applications for oil and gas wells. Under the agreement, Slant Operating waived its right to protest Octane's Green Gables Wells permits, while Octane agreed to "waive its right to protest future Slant drilling permit applications insofar . . . as they concern Off Lease Penetration Points where Octane is the offset operator of record." Plaintiffs alleged Octane breached by refusing to provide a waiver for Slant Operating's Gardendale Wells, forcing redesign and shortening productive lateral length. Plaintiffs are related entities—Slant Operating operates the wells while Slant Holdings owns the leasehold rights—and sought three categories of damages: lost revenue for the six Gardendale Wells, lost revenue for 35 additional unidentified future wells, and drilling redesign costs for the Gardendale Wells.
Procedural Posture: Motion to Strike and Dual Summary Judgment Theories
Octane filed both a traditional and no-evidence motion for summary judgment on October 2, 2025, targeting all three damage categories for both plaintiffs. After the October 29 hearing, Judge Bullard ordered plaintiffs to respond to Octane's evidentiary objections by November 3, 2025. Plaintiffs timely filed their response on November 3 stating they would file the Fielder Affidavit to cure hearsay objections, but did not actually file the affidavit until November 4. Octane moved to strike the affidavit as untimely on November 7, 2025. The court heard oral argument on both motions before issuing its December 22 memorandum opinion.
The Court's Ruling: Strict Enforcement of Deadlines and Entity-Specific Damage Analysis
Judge Bullard granted Octane's motion to strike, holding that the Fielder Affidavit was untimely summary judgment evidence filed without leave of court. The court emphasized that Rule 166a(c) requires nonmovants to file opposing evidence "no more than seven days before the hearing" except on leave of court, and that "[t]his rule permitting an opportunity to amend must be read in conjunction with the rule requiring leave of court for late-filed evidence." Because plaintiffs "failed to seek additional leave of Court to late file," the affidavit was stricken despite being only one day late.
On the merits, the court granted partial summary judgment with entity-specific holdings. The court found that Slant Operating "does not own leasehold or mineral interests entitling it to lost revenue" and granted summary judgment on all lost revenue claims for both the Gardendale Wells and the 35 future wells. The court also granted summary judgment in favor of Octane as to Slant Holdings on the redesign costs, apparently because Holdings was not the operator that incurred those expenses. However, the court denied summary judgment on redesign costs as to Slant Operating, finding that plaintiff "has produced evidence of redesign costs and additional expenses incurred as a result of Defendant's breach." The court further held "the record contains evidence of that plaintiff's expectancy damages," allowing at least some damage theory to proceed.
Significance: Procedural Rigor and Damage Theory Precision in Business Court
The opinion demonstrates the Business Court's strict adherence to summary judgment procedural requirements, even for one-day delays when the party has not secured express leave to file late. Practitioners should note that informal representations about forthcoming filings do not extend deadlines absent a court order. Substantively, the decision requires careful attention to which entity in a corporate family has standing to recover which categories of damages. Operators who do not own mineral or leasehold interests cannot recover lost production or revenue damages, even if they are parties to the operative contract. The court's willingness to address expectancy damages even though "Plaintiffs do not allege a specific theory/category of reliance damages in their petition" suggests some flexibility in damage theories at the summary judgment stage, but the entity-specific analysis remains rigorous. For oil and gas litigators, the case underscores the importance of aligning the contracting party, the damaged party, and the ownership structure when pleading and proving contract damages.