Thompson & Knight LLP v. Patriot Exploration, LLC, 444 S.W.3d 157

Patriot contracted to develop oil & gas leases; drilled 9 wells (3 dry, 3 uneconomic) and dissolved a partnership in Jan 2008 after failing production specs.
Patriot discovered a Title Gap in August 2007 (assignments went to Apollo Natural Gas, not Apollo Resources); T&K drafted corrective assignments but conflict caused T&K to withdraw; Patriot retained Watt and sued to cure the gap.
Sutton County default judgment (May 8, 2008; final July 7, 2008) ordered Apollo Natural Gas to assign the leases to Patriot, curing the Title Gap.
Patriot negotiated a September 18, 2008 settlement/sale to MexTex for $5.5M that also resolved the Sutton County litigation; Patriot sued T&K for malpractice claiming the Title Gap delayed sale by five months and cost $960,000.
T&K stipulated liability for the bench trial; the trial focused solely on causation/damages. Patriot’s expert Scheig modeled that an April 1, 2008 sale would have yielded $960,000 more based on projections and gas price differentials.
The trial court awarded $960,000; the court of appeals reversed, holding Scheig’s opinion legally insufficient and no evidence MexTex (the only actual buyer) would have paid more in April.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Sufficiency of expert damages opinion	Scheig used a DCF/reserve-based model and spot-price adjustments to show April value exceeded September value by ~$960k	Scheig relied on outdated/pre-drilling assumptions (2006 reserves), ignored Patriot’s actual 2007 drilling results/costs, and his model mischaracterized the 9/18/08 sale	Court: Expert opinion is legally insufficient — key assumptions materially contradicted by undisputed facts and thus cannot support damages award
Whether MexTex or another buyer would have paid more in April 2008	Natural gas spot prices were higher April 1, 2008; therefore a buyer (MexTex or others) would have paid more absent the delay	No direct evidence of any buyer other than MexTex; MexTex’s principal (Wiggins) testified MexTex would not have paid more in April	Court: No evidence MexTex (the only actual buyer) would have paid more in April; inference speculation is legally insufficient
Causation (proximate cause of asserted economic loss)	Delay caused by Title Gap proximately resulted in lower sale proceeds; expert quantifies the difference	Even if negligence occurred, Patriot must prove it probably would have obtained a higher April sale from an actual buyer; expert fails and no buyer testimony supports higher April price	Court: No legally sufficient evidence of proximate causation; judgment reversed and Patriot takes nothing

Ortiz v. Jones, 917 S.W.2d 770 (Tex. 1996) (bench‑trial factual sufficiency standards)
Sanders v. Total Heat & Air, Inc., 248 S.W.3d 907 (Tex. App.—Dallas 2008) (nonjury findings review)
Akin, Gump, Strauss, Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 299 S.W.3d 106 (Tex. 2009) (legal malpractice proof and sufficiency review principles)
City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (standards for reviewing sufficiency of evidence, including expert testimony)
Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706 (Tex. 1997) (legal sufficiency standards)
Elizondo v. Krist, 415 S.W.3d 259 (Tex. 2013) (measure of malpractice damages and requirement to prove probable higher recovery absent malpractice)
Burroughs Wellcome Co. v. Crye, 907 S.W.2d 497 (Tex. 1995) (expert opinions based on assumed facts varying materially from actual facts lack probative value)
Whirlpool Corp. v. Camacho, 298 S.W.3d 631 (Tex. 2009) (rigorous examination of expert assumptions)
Cooper Tire & Rubber Co. v. Mendez, 204 S.W.3d 797 (Tex. 2006) (expert testimony and analytical gaps)
Marathon Corp. v. Pitzner, 106 S.W.3d 724 (Tex. 2003) (an inference stacked only on other inferences is legally insufficient)