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In 2008, two land parcels at Lake Texoma State Park were sold to Pointe Vista Development (PVD) based on their agreement to construct a “four star hotel and convention center” by the end of May, 2014. Former Chesapeake Energy CEO and founder Aubrey McClendon, and Chaparral Energy CEO Mark Fischer became the new owners of 758 acres of Oklahoma’s most valuable public park land. After six years of inaction Pointe Vista was sued for breach of contract in the Oklahoma County District Court.

More than a year has passed since the suit was filed by the state Commissioners of the Land Office (CLO) on January 9, 2014. The only court hearing was held last May 16 when Judge Roger Stuart denied Pointe Vista’s motion to dismiss part of the suit. CLO attorneys argued that “specific performance” of the contract may not provide meaningful relief to the state. They said Pointe Vista has “18 days to complete a hotel and convention center” and they haven’t even begun construction.

Therefore the CLO requested (1) court costs and (2) the right to possibly rescind the 2008 purchase agreements and force Pointe Vista to return title to the former Lake Texoma State Park land.

As a sole remedy in the contract between the CLO and PVD, “specific performance” means that the only legal recourse to Pointe Vista’s breach of contract would be an order from the court providing even more time to complete the project. CLO attorneys argued that such a remedy would be unconstitutional if it is not a true remedy. Pointe Vista failed to break ground within six years.

Judge Stuart denied Pointe Vista’s motion to dismiss the additional remedies. He ordered their attorneys and CLO attorneys to create a hearing schedule on the first phase of the lawsuit and to focus strictly on the issue of specific performance. Judge Stuart directed them to do the following:

“I want you all to go back right now and come up with a scheduling order.”
“I want to have a discovery conference maybe within two weeks.”
“I want you all to lay out for me what discovery is going to consist of. We’re going to limit discovery to the issue of specific performance as opposed to all of these other things. The alternative remedies at least at that point.”
“I want you to go ahead and set a hearing. I don’t know who’s going to move. I want you to go ahead and set some hearing dates at this time. I don’t see any reason — I’m not going to sit around here and in a year from now be arguing what’s a commercially reasonable amount while we’ve sat on this case for a year doing a bunch of discovery and stuff.”
“I think it would be a great time to start today. I think a great time to start talking about that is while you’re doing a scheduling order back there. Don’t you all? Pointe Vista’s legal counsel Michael McClintock responded, “Absolutely, Your Honor.”
“And at some particular point if you reach an impasse and need a mediator to resolve some of the issues before we have a hearing, then I want to make sure that that’s made available to you all and you all know that that’s an alternative.” MR. MCCLINTOCK: “We appreciate that, Your Honor.”

Judge Stuart, “All right. You want to draw up an order?”

MR. MCCLINTOCK: “Absolutely.”

Lot’s of Posturing, No Follow Through in Oklahoma County Court

Eight months have passed since this energetic exchange between Judge Stuart and the two parties to the suit. The Oklahoma State Courts Network (www. oscn.net) hasn’t shown any activity on the case since the hearing last May 16th ( Search civil case # CJ-2014-152).

The above quotes are from the court transcript purchased last summer from court reporter Kim Lewin. When contacted this week, Lewin stated that there have been no hearings or hearing schedule produced for the case, or they would be posted online.

Judge Stuart’s court clerk, Shalease Blue, was asked this week if there had been a hearing, or if a hearing schedule had been created since last May. She said there has been no activity in the case, no hearings and no hearing schedule. She said that if there is no response by the plaintiff or defendant’s attorneys within one year, Judge Stuart can order both parties to meet again before the court.

I contacted one of the partners at Conner & Winters, and CLO general counsel Lisa Blodgett to inquire about the status of their lawsuit against Pointe Vista Development. Neither have responded.

Given the cordial nature of the first hearing and complete agreement on moving forward with the case, it is puzzling that there have been no hearings, or hearing schedule created as ordered by the judge.

This raises obvious questions about the purpose of the suit and possible conflict of interests of this state court judge. Roger Stuart was appointed to the court by Governor Fallin in 2011. He was previously an assistant general counsel for Kerr McGee Corporation. In 2012, he threw out a class action law suit filed by Chesapeake Energy stockholders against Aubrey McClendon. McClendon is the great nephew of former U.S. Senator Bob Kerr, of Kerr-McGee Corporation. He is a large donor supporter of Republican Governor Mary Fallin. Fallin has been one of the key supporters of the Lake Texoma State Park privatization beginning almost twenty years ago as Lt. Governor under former Governor Frank Keating.

The other key issue raised by Pointe Vista attorneys last May is the legality of a third contract for an additional 1,022 acres of federal land labeled as “Area C.”

Will Judge Stuart Rule on Pointe Vista’s “Area C” Contract?

The May 16 court transcript shows Pointe Vista’s lawyers introducing the question of whether a third land parcel “Area C” is part of their contract with the Oklahoma Commissioners of the Land Office (CLO).

This formerly “secret contract” was first revealed by news reporter Brianna Bailey of “The Oklahoman” in July, 2013. Governor Fallin and Oklahoma Tourism Secretary Deby Snodgrass initially refused to release the contract based on their concern for Pointe Vista’s privacy. The June, 2008 contract is between the Tourism Department and Pointe Vista and was written by McClendon’s attorney’s at McAfee & Taft, not the staff attorneys of the CLO.

Pointe Vista’s attorneys argue that the CLO is the same as the State of Oklahoma and the Oklahoma Tourism and Recreation Department (OTRD). And, that, if OTRD signed the Area C contract, then the CLO must honor it. Former CLO general counsel Perry Kaufman stated in 2008 that they would not pursue any more federal land transfers after the 564 acres of federal land contained in Areas A and B. He said that If Pointe Vista wanted more, that was strictly between them and the Tourism Department.

“There Will Be No Area C Land Transfer Without A Full EIS”

The original 2004 Request For Proposals on the CLO’s “Lake Texoma Redevelopment” was for a 758 acre project with approximately 523 acres in Area A, north of US Hwy 70, and 227 acres in Area B, including the old state park resort lodge and most of the original 18-hole public golf course to the south.

Pointe Vista may want Area C, but Tourism doesn’t own Area C. It is federally protected public land owned by the American taxpayers and managed by the Corps of Engineers. In 2008 Pointe Vista purchased the amount of land originally slated for the development, and yet they wanted more. No one forced them to go for Area C, but they were told that it would require a new environmental study.

U.S. Army Corps of Engineers (USACE) environmental officer Stephen Nolen stated in 2012, “There will be no Area C land transfer to the state without a completed Environmental Impact Statement (EIS).” Area C includes all of the campgrounds at Lake Texoma State Park and hundreds of acres of undeveloped shoreline wild lands south of the park as far as the BNSF railroad tracks.

Not only did Pointe Vista fail to break ground within six years, they barely began the federal EIS on Area C in September, 2009 when they started arguing with the Tourism Department over who was to pay the estimated $2 million cost. For two years, they put on a good show of involving the Lake Texoma community “stakeholders” in the environmental review process. But ultimately they refused to pay for the Draft EIS and quietly abandoned it in 2011.

When Pointe Vista publicly blamed the Corps of E