City of Sulphur Springs v. Luminant Mining Company, LLC, Luminant Generation Company, LLC, Vistra Corp., and Matthew Goering

Texas Court of Appeals, 6th District (Texarkana)·Decided July 22, 2026·No. 06-26-00025-CV·Published

Opinion

In the Court of Appeals Sixth Appellate District of Texas at Texarkana

No. 06-26-00025-CV

CITY OF SULPHUR SPRINGS, Appellant

V.

LUMINANT MINING COMPANY, LLC, LUMINANT GENERATION COMPANY, LLC, VISTRA CORP., AND MATTHEW GOERING, Appellees

On Appeal from the 62nd District Court Hopkins County, Texas Trial Court No. CV45943

Before Stevens, C.J., van Cleef and Rambin, JJ. Memorandum Opinion by Justice Rambin Dissenting Opinion by Justice van Cleef MEMORANDUM OPINION

The City of Sulphur Springs brings an interlocutory appeal1 of the trial court’s grant of a

temporary injunction to Luminant and parties aligned with Luminant.2

In November 2019, Luminant deeded the site of an abandoned coal and lignite mine to

the City. The property conveyed is roughly 5,000 acres. The deed contains a provision, known

as a restrictive covenant, restricting the City’s use of the property. In the broadest of strokes,

Luminant is in the electrical power business,3 and the restrictive covenant has to do with

electrical power. In 2025, the City sought to be let out of the restriction so that the land could be

used for a data center with an on-site power plant.4 On April 3, 2025, Luminant wrote that “it is

highly unlikely that the commercial generation restriction will be lifted, save for an

extraordinarily aggressive all-cash bid.” Luminant added: “If that works for you, please reply

1 The Texas Legislature authorized interlocutory appeals of trial court temporary injunction orders via Section 51.014 of the Texas Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(4) (Supp.). 2 Luminant Mining Company, LLC, Luminant Generation Company, LLC, and Vistra Corp., present a unified brief. We refer to them collectively as Luminant for that reason, and because the two named Luminant entities were the grantors on the deed at issue. 3 The City’s original petition in the trial court alleged that two named Luminant entities

are companies in the energy business who mine coal, lignite, and other natural resources and then . . . generate the resources into electricity or other forms of energy. Defendant Vistra Corp. is the parent company of both Luminant Defendants, as well as many other subsidiary companies in business in all areas of the generation, production, storage, and sale of electricity in Texas as well as across the nation.

That summary is consistent with the testimony of Amy Simcox, Vistra’s Managing Counsel of Real Estate: “Vistra is an integrated generation and retail power company. We operate in over 20 states.” 4 The City initially asked Luminant if it would provide power for the data center development. Luminant declined. The City, at one point, indicated that the data center’s on-site power plant could generate two-to-three gigawatts of electricity, but the City and the data center company later testified that the power plant need not be that large. The data center company is not a party to this appeal. 2 with an indication of your interest.”5 The City’s April 11, 2025, reply (in other words, the City’s

bid) was met with an April 14, 2025, rejection by Luminant. Litigation ensued in October 2025.

The City sued to get out from under the restrictive covenant.6 Luminant countered, seeking

among other things “temporary and permanent injunctions enforcing the [c]ovenant.” Luminant

contended then (and contends still on appeal) that it “forwent significant financial gain that they

could have realized through a future market sale of the [p]roperty.” Both sides disputed the

extent of the restriction imposed by the restrictive covenant by fighting over the meanings of the

words and clauses in the restrictive covenant.

On February 10, 2026, the trial court entered a temporary injunction against the City’s

proposed use, pending a trial set for September 2026.

On appeal, the City questions first whether the trial court should have issued a temporary

injunction, and second, whether the trial court’s injunction order sufficiently set out the basis for

the injunction.

The City’s first point brings the battle over the interpretation of the restrictive covenant to

this Court.7 Luminant initially responds that the trial court’s injunction order should be affirmed

5 In the same vein, on April 2, 2025, Luminant had written, “[W]e are not willing to remove the deed restriction without significant compensation in return. If that is something you would like to discuss we can consider any proposals but for now we cannot consider removing the restriction.” 6 The City’s original petition asked to have the restrictive covenant declared “void” and “unenforceable.” 7 The restrictive covenant states,

Restrictive Covenant: Purchaser covenants that the Property will not be used for the commercial production, commercial generation or commercial storage of electricity in any form, nor will it be used for the siting of a commercial power station or energy storage facility of any kind. This covenant restricting any use of the Property to commercially generate, produce or store electricity or to otherwise site a power station or energy storage facility, in any form or of any kind, shall be a 3 because what the City has in mind would breach any interpretation of the restrictive covenant.

Luminant asserts that this Court should not review the trial court’s interpretation of the restrictive

covenant, but instead should leave interpretation to be settled at trial: “[T]he construction issue

[meaning interpretation] is a merits question inappropriate for resolution at the injunctive stage,

not on this interlocutory appeal.” Nonetheless and ultimately, Luminant responds to the City’s

contentions regarding the interpretation of the restrictive covenant with reasons why, in

Luminant’s view, this Court should review the trial court’s interpretation of the restrictive

covenant and interpret it the same way.

Much of the interpretive battle hinges on what is or is not “commercial” and on what can

or cannot be done on-site.8 Under Luminant’s view (which, it asserts, is the trial court’s view),

the restrictive covenant “prohibits the production, generation, or storage of electricity that is used

in[9] a commercial enterprise.” Luminant asserts that the words of the restrictive covenant should

covenant running with, touching, and encumbering the Property, binding upon the Grantee and all successors in interest or title, transferees, vendees, lessees, mortgagees, and assigns who are owners and/or users of the Property. 8 For example, the City asserts in its brief that Luminant’s interpretation of the restrictive covenant would prohibit

a for-profit corporate office that installs solar panels on the roof to reduce its electric bill; a for- profit hospital that uses a backup generator in power outages; a for-profit tech company that uses an uninterruptable power supply to protect servers hosting its website; a for-profit law office that uses laptop computers with batteries to provide legal advice; or even a for-profit lawn service using cordless equipment to cut grass or blow leaves.

To that, Luminant responds: “Like a data center, a for-profit corporate office, a for-profit hospital, a for-profit tech company, a for-profit law office, and for-profit lawn service are all permissible uses under the terms of the Restrictive Covenant,” but, Luminant goes on to add, the restrictive covenant would not permit “any of these kinds of commercial enterprises to produce, generate, or store electricity on the property.” 9 Elsewhere in its brief, where “used in” might go, Luminant phrases this as “enabl[ing]” or “in relation to” or “in connection with” such enterprises.

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City of Sulphur Springs v. Luminant Mining Company, LLC, Luminant Generation Company, LLC, Vistra Corp., and Matthew Goering, (Tex. Ct. App. 2026).

City of Sulphur Springs v. Luminant Mining Company, LLC, Luminant Generation Company, LLC, Vistra Corp., and Matthew Goering (City of Sulphur Springs v. Luminant Mining Company, LLC, Luminant Generation Company, LLC, Vistra Corp., and Matthew Goering) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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