Clark v. Conocophillips Co.
465 S.W.3d 720
Tex. App.2015Background
- A. Reagan Clark and his mother signed hybrid gas royalty leases in 1993; production began 1996–1998 and royalties were paid through December 2003.
- In 1999 a class action (Bowden) accused ConocoPhillips of underpaying royalties; the trial court certified subclasses and later certified a revised Subclass 1 (proceeds-based royalties).
- Appellate proceedings reversed the certifications multiple times; the Texas Supreme Court ultimately affirmed decertification of revised Subclass 1 in February 2008 (mandate March 2008).
- Clark intervened in the Bowden litigation in February 2010, alleging underpayment from 1996–November 2003; the trial court severed his claims.
- ConocoPhillips moved for summary judgment asserting Clark’s claims were time-barred by the four-year limitations period; the trial court granted summary judgment.
- The court of appeals reversed: it held American Pipe tolling applied to Clark’s claims while Subclass 1 was certified and that tolling continued through resolution on the Texas Supreme Court review, making Clark’s 2010 intervention timely.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether filing of the Bowden class action tolled limitations for Clark’s claims (American Pipe tolling) | Tolling applied from Bowden filing (1999) through final denial of class certification, so Clark’s 2010 intervention was within four years | Tolling ended earlier — either when trial court re-certified a narrower subclass excluding Clark (June 2002) or when the court of appeals reversed certification (May 2003) — so Clark’s claims are time-barred | Tolling applied because Clark’s claims fit revised Subclass 1; tolling continued through the Texas Supreme Court’s affirmance of decertification (2008), so Clark’s 2010 intervention was timely |
| Whether Clark’s two‑prong leases excluded him from the revised Subclass 1 | Clark’s claims challenged proceeds-based payments to an affiliate and alleged breach of marketing duties, fitting Subclass 1 regardless of damages methodology | ConocoPhillips argued the leases’ market-value prong and Clark’s expert’s market-value damages placed him outside Subclass 1 | Court held revised Subclass 1 expressly included two‑prong leases and proceeds-based claims; Clark’s allegations fit the subclass |
| When tolling ends for purposes of limitations — upon appellate judgment or mandate/supreme-court resolution? | Tolling continues while appellate review is pending and ends when class certification is finally denied (supreme court decision/mandate) | Cited federal decisions: tolling ends when appellate court issues judgment reversing certification (mandate formality) | Court held Texas appellate rules and the right to interlocutory appeal mean tolling continues through supreme court review; tolling ended with the supreme court’s affirmance in 2008 |
| Burden on defendant for summary judgment on limitations | Plaintiff argued tolling defeats the limitations defense and defendant must conclusively negate tolling | Defendant argued limitations barred claims and bore no further burden | Court held defendant failed to conclusively establish limitations because it did not disprove American Pipe tolling; summary judgment reversed |
Key Cases Cited
- American Pipe & Constr. Co. v. Utah, 414 U.S. 538 (U.S. 1974) (putative class filing tolls statute of limitations for unnamed class members)
- Crown, Cork & Seal Co. v. Parker, 462 U.S. 345 (U.S. 1983) (tolling preserves class-action efficiency and prevents multiplicity of suits)
- Phillips Petroleum Co. v. Bowden, 247 S.W.3d 690 (Tex. 2008) (Texas Supreme Court addressing certification/decertification of Bowden subclasses)
- Grant v. Austin Bridge Co., 725 S.W.2d 366 (Tex. App.—Houston [14th Dist.] 1987) (recognizing tolling under American Pipe in Texas practice)
- Taylor v. United Parcel Serv., Inc., 554 F.3d 510 (5th Cir. 2008) (members of a certified class may rely on representatives through appeal)
- Diaz v. Westphal, 941 S.W.2d 96 (Tex. 1997) (defendant must conclusively prove limitations as an affirmative defense on summary judgment)