Royalty Trust Unitholder Can't Sue XTO, Bank Of America

By Jess Krochtengel (July 28, 2015, 6:54 PM EDT) -- In a case of first impression, a Texas appellate court on Monday held neither XTO Energy Inc., as the settlor of a publicly traded oil and gas royalty trust, nor trustee Bank of America NA can be subject to a unitholder derivative suit alleging the trust was shortchanging royalty payments.

The Fifth Court of Appeals in Dallas dismissed derivative claims filed against XTO, an ExxonMobil Corp. subsidiary, that alleged the company cheated the New York Stock Exchange-traded Hugoton Royalty Trust out of $60 million in royalties, and held Texas law does not permit trust beneficiaries to bring derivative claims on behalf...

Stay ahead of the curve

In the legal profession, information is the key to success. You have to know what’s happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.

  • Access to case data within articles (numbers, filings, courts, nature of suit, and more.)
  • Access to attached documents such as briefs, petitions, complaints, decisions, motions, etc.
  • Create custom alerts for specific article and case topics and so much more!


Hello! I'm Law360's automated support bot.

How can I help you today?

For example, you can type:
  • I forgot my password
  • I took a free trial but didn't get a verification email
  • How do I sign up for a newsletter?
Ask a question!