792 F. Supp. 2d 948
S.D. Tex.2011Background
- Quicksilver Resources, Inc. v. Eagle Drilling, LLC et al. involves conflicts-of-law in a federal diversity action in the SD Tex; the contract provisions designate Oklahoma law.
- The IADC contracts contain a broad Oklahoma-law governing clause stating the contract shall be governed and interpreted in accordance with Oklahoma law and that the parties’ relations are determined by Oklahoma law.
- The court adopts the Magistrate Judge’s recommendation that Oklahoma law apply to Quicksilver–Eagle contract claims and to Eagle’s false representation claim against the individual defendants.
- Texas law is urged for Eagle’s tortious-interference, conspiracy, and false-light claims against the individual defendants; Oklahoma law is urged for other tort claims.
- The analysis uses Restatement principles to determine which state has the most significant relationship to each claim and party, allowing state-by-state determinations per claim and defendant.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicable law for Quicksilver–Eagle torts | Quicksilver argues Oklahoma law should apply | Eagle argues Oklahoma law governs all claims | Oklahoma law applies to Quicksilver–Eagle torts |
| Effect of broad IADC clause on tort claims | Clause covers the entire contract relationship | Clause may be narrower and not cover torts | Clause extends to tort claims between Quicksilver and Eagle |
| False representation claim against individual defendants | Oklahoma law governs regardless of defendants | Texas law could govern due to conduct location | Oklahoma law applies to Eagle's false representation claim against individuals |
| Tortious-interference, conspiracy, and false-light claims against individuals | Texas law should apply for these torts | Oklahoma law should govern all torts | Texas law applies to these tort claims against the individual defendants |
Key Cases Cited
- Caton v. Leach Corp., 896 F.2d 939 (5th Cir.1990) (broadly construed choice-of-law provisions may bind for related disputes)
- Mayo v. Hartford Life Ins. Co., 354 F.3d 400 (5th Cir.2004) (forum-state conflicts rules; most significant relationship approach in absence of contract)
- Benchmark Elecs., Inc. v. J.M. Huber Corp., 343 F.3d 719 (5th Cir.) (issue-by-issue conflicts analysis; broad vs. narrow provisions)
- El Polio Loco, S.A. de C.V. v. El Polio Loco, Inc., 344 F. Supp. 2d 986 (S.D. Tex.2004) (contract provision covering contract performance can extend to torts)
- Stier v. Reading & Bates Corp., 992 S.W.2d 423 (Tex.1999) (Texas choice-of-law about contract-based disputes)