Quicksilver Resources (KWK) Granted Motion for Partial Summary by Texas in BreitBurn (BBEP) Lawsuit
Quicksilver Resources Inc. (NYSE: KWK) today announced that on November 23, 2009 the 48th District Court in Tarrant County, Texas granted Quicksilver's Motion for Partial Summary Judgment and denied the Motion for Partial Summary Judgment filed by BreitBurn Energy Partners L.P. (NASDAQ: BBEP).
Quicksilver brought suit against BreitBurn and others claiming, among other things, that the BreitBurn Defendants had improperly adopted unilateral changes to the Limited Partnership Agreement which attempted to limit Quicksilver's right to vote for BreitBurn GP, LLC's Board of Directors. Specifically, BreitBurn attempted to place a cap which prevented unitholders from voting their units in excess of 20% of outstanding units even if the unitholders owned a greater percentage. Quicksilver owns 21,347,972 units, representing approximately 40% of the total outstanding units, and is the only unitholder with greater than 20% ownership in the partnership. The Court held that BreitBurn's attempt at the voting cap was invalid and that Quicksilver has the right to vote all of its units for purposes of a quorum and on any action provided for in the Limited Partnership Agreement.
The Court further held that the Partnership Agreement requires Directors to determine whether an amendment would adversely affect the Limited Partners in any material respect and that the Directors failed to do so.
Pursuant to a previous agreement between BreitBurn GP, LLC and Quicksilver, the annual meeting of BreitBurn Energy Partners, LP must be held within 120 days from the Court's order, at which time there will be a vote on the election of two BreitBurn GP, LLC Directors.
Quicksilver will request that the BreitBurn GP, LLC Board move forward with holding the long delayed 2009 annual meeting of unitholders and the election of Directors as quickly as possible.
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