Dore Law - April 2020

THE D or É R eport

D ore L aw . com

APRIL 2020

LET ME TELL YOU ANOTHER STORY ... MUD MOTOR MYSTERY

Once upon a time, an O&G service company provided a drilling mud motor to assist in directional drilling of a well in Polk County, Texas. When the $700,000 invoice came through, the customer refused to pay the bill. The objection was that the penetration rate had been only about 6 feet per hour, but when the motor and bit were pulled, replaced, and rerun, the penetration rate jumped to almost 70 feet per hour. That’s where I come into this story. I told my client (the mud motor company) that it sounded like the dispute had some merit, but I’d get to the bottom of it. Initially, I figured my client would need to offer a big discount on their initial bill. After recovery, the investigation found that the hydraulic pressures were good, the mud circulation was unimpeded, and the mud motor was working fine. As it happened, I also represented the company that supplied the drill bit, so I pulled the bit records. Guess what I found? The bit had been completely worn out. The shoulders were gone, and “I learned a lot during this case, but here’s the bottom line: You can’t automatically believe the reason given for a job dispute. The customer might be under hidden financial pressures, and it’s up to the smart oil and gas lawyer to dig them up.” the cutters were almost falling out. This bit had been left in place too long. Worse, the company man who had made the decision

to keep this bit running so long was also one of the owners of the company, my client’s customer. When the bit and motor were replaced, the penetration rate jumped because it was only enlarging the hole to the correct size (called “under-reaming” by you engineering types). When I called the customer’s general counsel to report my findings, she told me she didn’t really care about all of the details. Basically, the customer wanted a discount to resolve the dispute regardless. Fortunately, I had anticipated this position. I told her that I had already obtained authority to offer two options. First, the customer could pay the invoice in three equal monthly installments with no interest, or second, the customer could accept service of process for a lawsuit because there would be no discount. I also explained the uncomfortable position that both I and the general counsel would be in if the first option were rejected. A lawsuit

would mean that my first deposition would be with this company man, and I would have to force him to explain why he’d made such a terrible engineering decision — a decision in contradiction to all the service company recommendations — which he was trying to hide from his investors by putting the blame on his innocent equipment suppliers. The next day, I received a call from the general counsel to accept the three-month payment terms. I learned a lot during this case, but here’s the bottom line: You can’t automatically believe the reason given for a job dispute. The customer might be under hidden financial pressures, and it’s up to the smart oil and gas lawyer to dig them up.

All’s well that ends well, my friends.

-Carl Doré

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Trips Don’t Have to Be Terrible 4 TRAVEL MISTAKES YOU KEEP MAKING

Most people love to travel, but few people enjoy business trips. While that can partially be chalked up to the extra rest and relaxation you might have on a nonwork-related trip, unhealthy habits can make business trips even more draining. If business trips leave you feeling like you need a vacation, you might be making the following mistakes. SKIPPING BREAKFAST On hectic mornings with early meetings, it’s tempting to skip breakfast and just grab some coffee. But if you usually eat breakfast at home, skipping your morning meal can cause you to be a lot hungrier later, which can lead to excess snacking or overeating at lunch. When traveling, stick to your regular eating habits. EATING RESTAURANT SERVING SIZES If you’re eating three restaurant-sized meals a day, you’re going to get more calories than if you were cooking at home. Don’t be afraid to order half- portions or stick to the appetizer menu. You can also ask about ordering meals à la carte — no one needs all those fries with their burger, anyway. These strategies will help you save money and stick to a healthy calorie count. NOT PACKING WORKOUT GEAR Research from the travel risk management company On Call International found that 54% of people say they’re less likely to exercise while on a work trip, but you shouldn’t let fitness take a back seat. Packing workout clothes can

serve as a reminder to get some exercise. Get in a good workout by taking advantage of the hotel gym, walking to nearby destinations, or doing some yoga in the hotel room before bed. NOT TAKING SLEEP SERIOUSLY Early morning meetings, late-night networking events, and unfamiliar hotel rooms are a recipe for lost sleep. Lack of sleep puts your body on the fast-track to poor health, so you need to make good sleep a priority. Do your best to maintain your sleep schedule and bedtime routine while traveling. Better yet, check the guest reviews before booking your hotel. Heed complaints about thin walls or uncomfortable beds and find accommodations that support a good sleep environment.

You shouldn’t have to dread business trips. Build better travel habits to feel healthier and enjoy every kind of trip you take this year.

DON’T LET A REAL ESTATE COMPANY TAKE ADVANTAGE OF YOU

NEGOTIATE THE OPERATING EXPENSES. With a triple-net lease, you’re not only responsible for rent but also for a proportionate share of insurance, taxes, and operating expenses of the shopping center or building. There is almost always room to negotiate what’s included in the operating expenses and cap the percentage of operating expenses the tenant must pay. We know all of the tricks and can save you money during negotiations. PUSH FOR EXPANDED INDEMNITY. The indemnity section of a lease provides each party with protection from the other party under certain circumstances. Our firm can help you negotiate the most expanded indemnity provision possible to protect against the negligence and misconduct of landlord, its employees, and customers. SEEK COVERAGE FOR RELOCATION. If you’ve invested in improving the premises you’re renting, the last thing you need is for

At this time each year, the Texas real estate industry springs into action. Properties flood the market and many residential and commercial leases become available. At Doré Rothberg McKay, we help clients negotiate commercial lease agreements around Texas and all over the United States. Leases typically surpass 100 pages of difficult legal provisions, making a real estate attorney essential. Though every lease is different, here are four steps we can help you take to protect yourself. GO CORPORATE, FAST. We recommend setting up a corporate entity prior to entering into a commercial lease. A limited liability company will protect you from personal liability if someone is injured while on the leased premises. It also creates a layer of protection between the tenant and the landlord so your personal assets won’t be available to the landlord in the event of a lease default. Our team can create a corporate entity for a flat fee, which includes expedited filing with the secretary of state.

the landlord to relocate your business. We can help protect you from that possibility, and if the landlord insists on relocation rights, then we can negotiate provisions ensuring they pay for all relocation costs, improvements, and business interruption costs. There are many ways to protect yourself when signing a commercial lease, and hiring an experienced real estate attorney is one of them. At Doré Rothberg McKay, we pledge to provide competent and efficient negotiation of your lease and ensure maximum protection so you can focus on growing your business.

-Haley Morrison

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MAY 20, 2020 CreditInEnergy.com

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MOM’S DEVILED EGGS by Tom Whiteside

Every Sunday for as many years as I can remember, my mother has fixed her version of deviled eggs for the meal everyone at my church shares after services. It is now a tradition and a family recipe she is happy to share.

INGREDIENTS

6 eggs, hard-boiled

1 tsp sweet pickle relish

1 tbsp Durkee Famous Sauce (a combination of mustard & mayo flavors)

1 tsp mayonnaise

DIRECTIONS

1. Hard-boil the eggs, let cool, and peel carefully. 2. Slice the eggs longways and remove yolks while keeping egg white halves intact for later. 3. In a bowl, mash egg yolks and combine with other ingredients. Feel free to add more of anything to taste. 4. Spoon the mixture back into the egg white halves, cover, and chill in the refrigerator for an hour. Garnish before serving or just dig in. Makes 12 deviled eggs.

BUNNY

EGGS

POLLEN

DAISY

FOOL

PRANK

EARTH

GARDEN

RAMADAN

EASTER

PASSOVER

TAXES

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The Mud Motor Mystery

Are Business Trips Bad for Your Health?

4 Ways to Protect Yourself When Signing a Commercial Lease

Trends and Traps 2020

Mom’s Deviled Eggs

What Fantasy Brings to Reality

HELP YOUR COMPANY SLAY THE DRAGONS THE WITH BUSINESS LESSONS FROM FANTASY NOVELS

The bookshelf of your average business owner is usually chock-full of hard-hitting nonfiction. And why not? Books like “The Obstacle Is the Way,” or “The 7 Habits of Highly Effective People” are great sources of inspiration for entrepreneurs in any industry. But did you know that the world of fiction has lessons to offer, too? ‘THE HOBBIT’: A POORLY PLANNED VENTURE J.R.R. Tolkien’s first fantasy novel chronicles a quest for treasure, led by the upstart dwarf king Thorin Oakenshield. There’s just one problem: A dragon guards the gold and jewels. Thorin has no plan to defeat this threat, and his party unwittingly releases it upon a town. The angry residents then hold the dwarf king liable for destruction of property. The dragon attack was a known risk in Thorin’s venture, and he failed to account for it. Rather than work to protect himself from risk (and liability), he failed to prepare for the worst outcome. Wishful thinking never helps leaders — even in fantasy stories. ‘HARRY POTTER’: HOGWARTS BUILT TO SELL In the final book of the megahit series, it becomes clear that Dumbledore’s real wizardry was in his ability to execute an exit

strategy. Over the course of the novel, Harry and his friends uncover the tools Dumbledore left behind to defeat Voldemort. The instructions he left were cryptic at best, but thankfully, Harry and friends eventually sort things out. Dumbledore’s key to success was putting the right people in the right positions. ‘THE WITCHER’: TOSS A COIN TO YOUR MARKETER In Andrzej Sapkowski’s popular novels, Geralt of Rivia has a PR problem. Mistrusted for his supernatural abilities, he can rarely find work, despite being an expert in a niche industry: monster hunting. Those willing to hire him often misunderstand his services and think he’s an assassin, all due to a classic case of bad branding. Fortunately, our hero’s prospects change when he befriends an eccentric bard named Jaskier, who decides to write songs and poems about his adventures with Geralt. Soon, people across the continent know of Geralt and his talent for driving off things that go bump in the night, which goes to show that sometimes, good marketing makes all the difference.

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