THE GOTHAM IV DECISION

There are several appeals involved in Gotham’s legal battle with Warren E & P (now known as Pedeco), including Gotham Insurance Co. v. Warrant E & P, Inc., 455 S.W.3d 558 (Tex. 2014).   The question presented to the Texas Supreme Court was whether Pedeco suffered a loss because Warren Resources had reimbursed Pedeco for any losses related to the blowout.  The Gotham IV court noted that although there was evidence in the record that Warren Resources paid the expenses related to the blowout, there was also evidence that Warren Resources and Pedeco had an agreement to share in the aggregate profits and losses at the end of each year.  The court held that the evidence regarding the end-of-year settling of accounts was sufficient to raise a fact issue as to whether Pedeco suffered a loss and was therefore entitled to insurance proceeds.

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