Energy Transfer is seeking mandamus relief with the Texas Supreme Court after both the trial court and Fifth Court of Appeals in Dallas denied its Motion to Quash the deposition notice of Kelcy Warren, “Energy Transfer’s highest-level corporate officer.”
In 2022, Energy Transfer sued Culberson Midstream Equity, LLC and Moontower Resources Gathering, LLC for breach of contract, fraud, and declaratory judgment related to a 2018 agreement. Energy Transfer ultimately claims Culberson and Moontower mislead Energy Transfer about the gas gathering and processing agreement, and rather than gathering and delivering gas to Energy Transfer’s subsidiary, sold that gas to third parties. In dispute is just under $94MM.
As part of discovery, Culberson and Moontower noticed the deposition of Kelcy Warren, the executive chairman and chairman of the Board of Directors for Energy Transfer. Energy Transfer moved to quash this deposition, asserting Mr. Warren had no knowledge of the underlying agreements and that this notice amounted to an apex deposition. In their Motion to Compel, Culberson and Moontower argued Warren participated in important meetings pertaining to the underlying agreements and that Energy Transfer introduced Mr. Warren’s role into this case through questions asked of other deponents.
The trial court granted the Motion to Compel Warren’s deposition, and Energy Transfer’s first mandamus request was denied by the Fifth Court of Appeals. Energy Transfer now seeks relief from the Texas Supreme Court.
In its petition, Energy Transfer asserts Culberson and Moontower have not met their burden to compel this apex deposition as outlined in Crown Central Petroleum Corp. v. Garcia, 904 S.W.2d 125 (Tex. 1995). In Crown Central, the Texas Supreme Court established guidelines in seeking apex depositions, whereby the party seeking to quash the deposition can submit an affidavit from the executive denying knowledge of the facts. The court then decides whether the executive has any unique knowledge and whether alternative means of discovery have been used.
Using this standard, Energy Transfer provided an affidavit from Warren and cited the lack of email evidence and participation in the negotiating or execution of the agreements at issue. Further, Energy Transfer offers testimony from at least four other depositions directly involved in the negotiations that “yielded the information available to discover.”
The petition is currently pending with the Supreme Court.
Molly advises on all aspects of litigation, from risk mitigation to pre-suit investigation to trial investigation, and has extensive experience conducting depositions and handling motion practice. She represents clients in connection with commercial and industrial accident claims, construction disputes, engineering and design defect cases, contract and indemnity disputes, and general insurance defense litigation. In the oil and gas sector, Molly advises service companies, manufacturers, producers, operators, well interest owners, and others in complex matters before state and federal courts and regional governing agencies.