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Dallas City Wire

Sunday, May 19, 2024

Court rules City of Dallas owes Trinity East Energy $44.5 million for breaching oil exploration deal

Ward

A final judgment signed by Dallas County Judge Craig Smith determined that $44.5 million is owed to Trinity East Energy, an oil exploration firm, by the City of Dallas.

The trial, which Smith presided over, was between the City and Trinity East Energy, which paid the city $19 million to be able to drill on park land. Subsequently, however, permits to drill were denied to the company. 

The City of Dallas was found guilty of negligent misrepresentation, statutory fraud and denying use of the park land. The jury decided the city was guilty and owed Trinity East an amount between $23 million and $33 million, but Smith would ultimately decide the total. 

The maximum amount, $33.6 million, was determined by Smith, who also added $10.9 million in interest. If Dallas refuses to pay Trinity East, an additional $4,608 in interest will be applied to every day it refuses to pay. 

Attorney Art Anderson for Trinity East said, "We're pleased that the court judgement was in conformance with the jury's verdict."

Interim City Attorney Chris Caso declined comment when asked for a response on the trial. The City of Dallas has also not released any public statement on the trial or verdict. The city's attorney didn't try the case, but instead had the city approve $1.17 million for outside counsel in the case. 

The $19 million Trinity East paid for park land was received by the city in 2007, when then-City Manager Mary Suhm needed to help fill the $90 million budget. Another gas driller also paid millions of dollars to be able to drill near the Luna Vista Golf Course and by Trinity River's Elm Fork. 

In 2007 and in the trial, Trinity East said it believed the eastern edge of the Barnett Shale was worth drilling in. Suhm also told the company in 2007 in writing that she was confident that she could obtain the permits for the company, but she also told the City Council no one would be drilling on the park land. 

In 2013, the permits were declined for Trinity East, then not long after gas fracking 1,500 feet or less from residential and business areas was banned. 

Trinity East sued Dallas in 2014. Now, the City can appeal the verdict or settle, but it is unclear what it plans to do. 

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