Nicholas Kreines, David P. Ryan, Liberty Mineral Partners LLC, Nak Resources INC., and CGR Oil and Gas, LLC v. ES3 Minerals, LLC

Opinion

ACCEPTED 15-25-00027-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS 9/2/2025 7:34 PM NO. 15-25-00027-CV CHRISTOPHER A. PRINE CLERK IN THE COURT OF APPEALS RECEIVED IN 15th COURT OF APPEALS FOR THE FIFTEENTH JUDICIAL DISTRICTAUSTIN, TEXAS AT AUSTIN, TEXAS 9/2/2025 7:34:36 PM CHRISTOPHER A. PRINE Clerk NICHOLAS KREINES, DAVID P. RYAN, LIBERTY MINERAL PARTNERS LLC, NAK RESOURCES INC., AND CGR OIL AND GAS, LLC, Appellants, September 9, 2025 v.

ES3 MINERALS, LLC, Appellee.

On Appeal from the 459th Judicial Court, Travis County, Texas Cause No. D-1-GN-24-006854

AMENDED BRIEF FOR APPELLANTS

JAMES F. PARKER State Bar No. 24027591 GABRIELLE C. SMITH State Bar No. 24093172 SYDNEY P. SADLER State Bar No. 24117905 LLOYD GOSSELINK ROCHELLE &TOWNSEND, P.C. 816 Congress Ave., Suite 1900 Austin, Texas 78701 (512) 322-5800 (512) 472-0532 (fax) ATTORNEYS FOR APPELLANTS ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL

Appellants: Attorneys for Appellants:

Nicholas Kreines, David P. Ryan, James F. Parker Liberty Mineral Partners LLC, Gabrielle C. Smith NAK Resources Inc., and CGR Sydney P. Sadler Oil & Gas, LLC Lloyd Gosselink Rochelle & Townsend, P.C. 816 Congress Avenue, Suite 1900 Austin, Texas 78701 Telephone: (512) 322-5800 Facsimile: (512) 472-0532

Appellee: Attorneys for Appellee:

ES3 Minerals, LLC Michael D. Marin Tori B. Bell Boulette Golden & Marin L.L.P. 2700 Via Fortuna, Suite 250 Austin, TX 78746 Telephone: (512) 732-8900 Facsimile: (512) 551-9602

2 TABLE OF CONTENTS

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INDEX OF AUTHORITIES....................................................................... 7 STATEMENT OF THE CASE ................................................................. 11 INTRODUCTION .................................................................................... 13 STATEMENT REGARDING ORAL ARGUMENT ................................. 15 ISSUES PRESENTED FOR REVIEW .................................................... 16 STATEMENT OF JURISDICTION AND STANDARD OF REVIEW .... 19 A. Jurisdiction............................................................................ 19 B. Standard of Review. .............................................................. 19 STATEMENT OF FACTS ....................................................................... 21 A. ES3 is a mineral-interest broker. ......................................... 21 B. ES3 hires Ryan to convince mineral-interest owners to sell to ES3. ............................................................ 23 C. ES3 taps Ryan’s sales knowledge and experience to develop its software platform. .......................................... 23 D. Ryan leaves ES3 in 2021 and is subsequently rehired. .................................................................................. 24 E. ES3 hired Kreines to lead its efforts to sell the mineral interests that Ryan acquired. ................................. 24 F. ES3 requires its employees to sign non- competition agreements. ....................................................... 25 G. ES3 terminates Ryan for refusing to steal a consultant’s intellectual property. ........................................ 26 H. Ryan starts LMP to act as a mineral broker and secures its first AMI deal. ..................................................... 26 I. LMP hires an independent software designer to develop its own CRM platform to facilitate its business model. ..................................................................... 27 J. LMP sells its first mineral interest outside an AMI. ....................................................................................... 28

3 K. Kreines leaves ES3 in January 2024 to once more work as an independent landman. ....................................... 28 L. ES3 and LMP have not competed with one another. ................................................................................. 28 M. The Travis County District Court issues the Temporary Injunction, which the Business Court modifies. ................................................................................ 30 SUMMARY OF THE ARGUMENT ......................................................... 32 ARGUMENT & AUTHORITIES ............................................................. 36 A. The Temporary Injunction does not meet the requirements of Rules 683 or 684. ........................................ 36 1. The Temporary Injunction does not set out the reasons why ES3’s harm is irreparable as required by Rule 683. ................................................... 37 2. The Temporary Injunction does not meet the specificity requirement of Rule 683. ............................ 42 a. The Temporary Injunction does not define specific persons with whom Appellants cannot do business. .......................... 43 Appellants do not know with whom they cannot transact business from a simple reading of the Temporary Injunction.......................... 44 Appellants cannot conduct their own investigation to ensure compliance with the Temporary Injunction because its limitations are confidential. ......................................... 46 b. By barring Appellants from doing business with unknown companies, the Temporary Injunction violates Rule 683. ...................................................................... 47

4 3. The bond required by the Temporary Injunction is inadequate and contrary to the evidence. ....................................................................... 51 a. The trial court set a nominal bond that was unsupported by the evidence. ...................... 52 b. The bond should have been set on the basis of lost revenue, but even a lost- profit standard would have resulted in a significantly higher bond amount. ................... 53 c. The nominal bond set by the trial court essentially eliminated the bond requirement altogether. ...................................... 54 B. The evidence does not support the issuance of a temporary injunction. ........................................................... 55 1. There is no imminent and irreparable harm to ES3 ........................................................................... 56 a. ES3’s injury was not “immediate.” ..................... 57 b. ES3 has not endured an injury requiring injunctive relief. .................................. 58 c. ES3’s alleged damage to its relationship with buyers is speculative. ............................................................................. 60 2. The trial court improperly granted the Temporary Injunction because there is no probable right of relief on ES3’s claims. ...................... 61 a. This industry relies on the most basic principles of economics and marketing. ............................................................................. 62 b. ES3 identifies no trade secret that has been taken. .......................................................... 63 Though there is overlap due to the nature of the industry, the two companies employ different business practices. ..................................... 64

5 There are material differences in the pricing formula stemming from the differences in business practices. .................................................... 66 The two companies’ software platforms are different. .............................. 67 The identities of ES3’s buyers are not secret. ................................................... 70 c. The evidence doesn’t support ES3’s allegation that Ryan and Kreines have breached an enforceable covenant not to compete. .......................................................... 72 David Ryan has not breached the covenant not to compete. ........................... 72 The covenants are not supported by consideration. ........................................ 73 The restrictions in the covenants not to compete are unreasonable. .............. 75 A) The temporal restriction is unreasonable. ...................................... 75 B) The geographic restriction is unreasonable. ...................................... 76 C) Industry-wide restriction is invalid as a matter of Texas law......... 76 3. The Temporary Injunction does not contain a geographic restriction, thereby barring Appellants from engaging in lawful activity. .............. 77 CONCLUSION AND PRAYER ............................................................... 79 CERTIFICATE OF SERVICE................................................................. 81 CERTIFICATE OF COMPLIANCE ........................................................ 82 INDEX OF APPENDICES ...................................................................... 83

6 INDEX OF AUTHORITIES

Cases Page(s)

Amend v. Watson, 333 S.W.3d 625 (Tex. App.—Dallas 2009, no pet.) ............................ 20

Archon Design v. Naim, No. 03-23-00226-CV, 2023 Tex. App. LEXIS 6740 (Tex. App.—Austin Aug. 30, 2023, no pet.) ........................................ 56

Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002) ................................................ 17, 19, 20, 56

Citation 2002 Inv. Llc, & Endeavor Energy Res., L.P. v. Occidental Permian, 662 S.W.3d 550 (Tex. App.—El Paso 2022) ........................................ 73

Clark v. Hastings Equity Partners, LLC, 651 S.W.3d 359 (Tex. App.—Houston [1st Dist.] 2022, no pet.) .......................... passim

Computek Computer & Office Supplies, Inc. v. Walton, 156 S.W.3d 217 (Tex. App.—Dallas 2005, no pet.) ................ 47, 48, 50

DeSantis v. Wackenhut Corp., 793 S.W.2d 670 (Tex. 1990) .............................................. 17, 51, 52, 53

Ex parte Chambers, 898 S.W.2d 257 (Tex. 1995) ................................................................ 42

Ex parte Hodges, 625 S.W.2d 304 (Tex. 1981) ................................................................ 43

Ex parte Jackman, 663 S.W.2d 520 (Tex. App.—Dallas 1983, no writ) ............................ 42

Franklin Savings Association v. Reese, 756 S.W.2d 14 (Tex. App.-Austin 1988, no writ) ................................ 52

7 Home Asset, Inc. v. MPT of Victory Lakes Fcer, No. 01-22-00441-CV, 2023 Tex. App. LEXIS 2890 (Tex. App.—Houston [1st Dist.] May 2, 2023, no pet.) ................ 37, 40

Huynh v. Blanchard, 694 S.W.3d 648 (Tex. 2024) ................................................................ 57

Indep. Capital Mgmt., L.L.C. v. Collins, 261 S.W.3d 792 (Tex. App.—Dallas 2008, no pet.) ............................ 20

In re Krueger, No. 03-12-00838-CV, 2013 Tex. App. LEXIS 5984 (Tex. App.—Austin May 16, 2013, no pet.) ............................ 48, 49, 50

In re Luther, 620 S.W.3d 715 (Tex. 2021) .................................................... 43, 49, 50

IPSecure, Inc. v. Carrales, No. 04-16-00005-CV, 2016 Tex. App. LEXIS 6288 (Tex. App.—San Antonio June 15, 2016, no pet.) .................. 16, 34, 37

Kotz v. Imperial Capital Bank, 319 S.W.3d 54 (Tex. App.—San Antonio 2010, no pet.) ..................... 39

Lagos v. Plano Econ. Dev. Bd., 378 S.W.3d 647 (Tex. App.—Dallas 2012, no pet.) ............................ 18

Marsh USA Inc. v. Cook, 354 S.W.3d 764 (Tex. 2011) .................................................... 72, 74, 77

Parker v. Schlumberger Tech. Corp., 475 S.W.3d 914 (Tex. App.—Houston [1st Dist.] 2015, no pet.) .................................. 79

Paul v. Roy F. & JoAnn Cole Mitte Found., No. 03-21-00502-CV, 2023 Tex. App. LEXIS 772 (Tex. App.—Austin Feb. 8, 2023, pet. denied).................................... 45

Peat Marwick Main & Co. v. Haas, 818 S.W.2d 381 (Tex. 1991) .......................................................... 76, 77

8 Qwest Commc’ns Corp. v. AT&T Corp., 24 S.W.3d 334 (Tex. 2000). ........................................................... 36, 52

Stewart & Stevenson Servs. v. Serv-Tech, Inc., 879 S.W.2d 89 (Tex. App.—Houston [14th Dist.] 1994, writ denied) ........................ 74

Tarr v. Lantana Sw. Homeowners’ Ass’n, No. 03-14-00714-CV, 2016 Tex. App. LEXIS 13372 (Tex. App.—Austin Dec. 16, 2016, no pet.) ........................................ 45

Taylor Hous. Auth. v. Shorts, 549 S.W.3d 865 (Tex. App.—Austin 2018, no pet.) ............................ 20

Tex. Dep’t of Pub. Safety v. Salazar, 304 S.W.3d 896 (Tex. App.—Austin 2009, no pet.) ............................ 56

Totus Grp., LLC v. Pruitt Family Living Tr., No. 05-23-01222-CV, 2025 Tex. App. LEXIS 907 (Tex. App.—Dallas Feb. 14, 2025, no pet. h.) ..................................... 20

Van Huis v. Marine Ventures, Ltd., 672 S.W.3d 22 (Tex. 2023) ............................................................ 54, 55

Whinstone US Inc. v. Rhodium 30MW, LLC, 691 S.W.3d 47 (Tex. App.—Austin 2024, no pet.) ........................ 42, 45

Whitlow v. Polley, 670 S.W.2d 318 (Tex. App.—Tyler 1984, no writ) .............................. 54

Statutes

Tex. Bus. & Com. Code § 15.50 ................................................... 74, 78, 83

Tex. Gov’t Code § 25A.004(b) .................................................................. 55

Tex. Gov’t Code § 25A.006................................................................. 31, 83

9 Other Authorities

Rule 683 ........................................................................................... passim

Rule 684 ........................................................................................... passim

10 STATEMENT OF THE CASE

Nature of the This is a trade-secrets, breach-of-fiduciary-duty, breach- Case: of-contract and fraudulent-transfer case brought by mineral-interest broker ES3 Minerals, LLC (“ES3”) against former ES3 employees David P. Ryan (“Ryan”) and Nicholas Kreines (“Kreines”) and the mineral- interest companies established by them. ES3 alleges that Ryan and Kreines stole ES3’s trade secrets, proprietary software, and other confidential information, used that information to solicit ES3’s buyers and employees and in doing so breached the covenants to not compete entered into by Ryan and Kreines as a condition of their employment with ES3. ES3 sought to enjoin Ryan, Kreines, and their mineral- interest company Liberty Mineral Partners LLC (“LMP”) from entering or negotiating any transaction with ES3’s buyers, from encouraging ES3’s buyers to discontinue or limit their relationships with ES3, and from soliciting ES3’s employees for employment or encouraging them to terminate their relationships with ES3.

Trial Court: District Court for the 455th Judicial District, Travis County, Texas, Judge Laurie Eiserloh presiding.

Removed to the Texas Business Court for the Third District at Austin on December 23, 2024 (2d. Suppl. CR 1−9.)

Course of ES3 filed its Verified Original Petition and Application Proceedings: for Injunctive Relief on September 18, 2024 (CR 5−108.). The temporary injunction hearing was held on October 29–30, 2024.

After removal, Appellants filed a Motion to Dissolve the Temporary Injunction, which the Business Court heard on February 27, 2025.

11 Disposition in The trial court granted the temporary injunction on Trial Court: November 26, 2024, but did not serve the parties or file the Temporary Injunction Order until December 19, 2024 (CR 869−870.)

On February 27, 2025, the Business Court heard Appellants’ Motion to Dissolve the Temporary Injunction along with Appellee’s Motion to Modify the Temporary Injunction. (2d. Suppl. CR 10−189, 190−209.) The Business Court issued its Order Modifying Temporary Injunction on April 7, 2025. (2d. Suppl. CR 307−33.)

The Court granted Appellants’ Motion for Appellate Review under Rule 29.6 on April 11, 2025, and agreed to review the April 7, 2025 Modified Temporary Injunction issued by the Business Court alongside the original Temporary Injunction issued in November 2024.

12 INTRODUCTION

Along with a hundred others, ES3 and LMP are mineral-interest

brokers in West Texas. The business is simple; the broker buys mineral

interests from current owners and then resells them to buyers who plan to

repackage them for sale as securitized instruments or develop for extraction.

Ryan and Kreines are former ES3 employees. Ryan worked to acquire

mineral interests; Kreines worked on the divestiture side. Both signed

covenants not to compete.

When ES3 terminated Ryan in August 2023, he started LMP. In

January 2024, Kreines left ES3 to join Ryan. Over the next nine months,

LMP operated successfully without competing with ES3 to acquire any

mineral interest.

Because of that lack of competition, ES3 did not learn of LMP’s

existence until September 2024. When it did, it sued to enforce the

covenants not to compete. It also alleged theft of confidential information

and trade secrets and a breach of Kreines’s fiduciary duty. The trial court

issued a Temporary Injunction in November 2024.

Recognizing that LMP was not competing with ES3 to buy mineral

interests, the Temporary Injunction does not limit Appellants’ acquisition of

13 mineral interests. The Temporary Injunction only restricts Appellants from

selling mineral interests to entities that have done business with ES3.

Each mineral interest is different. LMP doesn’t compete with ES3 to

sell a mineral interest that it owns and ES3 does not. So, if the Temporary

Injunction’s restriction seems nonsensical, that’s because it is. And the

district court was unable to set forth the reasons why a temporary injunction

should be issued, notwithstanding the requirements of Rule 683.

After Appellants removed the case to the Texas Business Court, that

court modified the Temporary Injunction’s restrictions, which are still

insufficiently specific to meet the requirements of Rule 683. The

modification also doesn’t state the reasons for the Temporary Injunction.

Two courts have now looked at this injunction. Neither could set forth

the reasons for its issuance. That’s because the evidentiary record does not

support the issuance of an injunction. ES3 identified no imminent harm

from LMP’s sales of mineral interests that ES3 doesn’t own. To the extent

ES3 has a harm, it has an adequate remedy at law. Neither the district

court nor the Business Court could explain why the Temporary Injunction

should be issued because it shouldn’t have been, and this Court should

reverse that decision.

14 STATEMENT REGARDING ORAL ARGUMENT

The temporary injunction issued by the trial court does not meet the

requirements of Texas Rule of Civil Procedure 683, in ways that limits the

trial court’s ability to enforce its own order. That noncompliance with Rule

683 derives largely from the fact that the evidence adduced at the

temporary-injunction hearing did not support the issuance of an injunction

in the first place.

After the district court issued the Temporary Injunction, Appellants

removed the case to the Texas Business Court, which modified the

Injunction. The Business Court’s modification carries over most of the same

fatally defective language. Any further attempt to modify the Temporary

Injunction to meet the requirements of Rule 683 would be equally fruitless

inasmuch as the Injunction is not supported by the record evidence.

To elucidate the difficulty the Business Court will have in enforcing

the Temporary Injunction resulting from its lack of specificity, and to

explain the lack of evidentiary basis for the Injunction, Appellants

respectfully ask the Court to set this appeal for oral argument.

15 ISSUES PRESENTED FOR REVIEW

1. Rule 683 requires an order granting a temporary injunction “be

specific in terms” and “describe in reasonable detail . . . the act or acts

sought to be restrained.” Tex. R. Civ. P. 683. The Temporary Injunction in

this case, however, does not definitively identify the persons or entities with

whom Appellants are enjoined from transacting business. Instead, to

determine whether a potential business partner is off-limits, Appellants

need to investigate whether it is a “contact and or decision maker who is/was

associated with” a confidential list of off-limits people/entities.

Issue Presented: Whether a temporary injunction that requires Appellants investigate third parties’ employment records to ensure compliance meets the specificity requirements of Rule 683.

2. Rule 683 also requires that “every order granting an

injunction . . . shall set forth the reasons for its issuance.” “And, when

setting forth the reasons for granting a temporary injunction, the trial court

must set forth specific reasons, not merely make conclusory statements.”

IPSecure, Inc. v. Carrales, No. 04-16-00005-CV, 2016 Tex. App. LEXIS 6288,

at *56 (Tex. App.—San Antonio June 15, 2016, no pet.). The Temporary

Injunction in this case, however, recites without further explanation “[a]ny

16 suit for money damages would not be an adequate remedy at law to protect

Plaintiff’s rights.” (CR 997–98, ¶ 17.)

Issue Presented: Whether a mere recital of the temporary-injunction elements sufficiently sets forth the reasons for the injunction’s issuance as required by Rule 683.

3. Rule 684 requires an order granting a temporary injunction to

fix a bond in an amount sufficient to compensate the defendant in the event

the injunction is ultimately dissolved. See Tex. R. Civ. P. 684; DeSantis v.

Wackenhut Corp., 793 S.W.2d 670, 686 (Tex. 1990). In this case, in which

ES3 acknowledges that the amount in dispute is more than $5 Million and

the evidence showed an injunction would immediately impair contracts

worth $3.6 Million, the trial court set a nominal bond of $25,000.

Issue Presented: Whether a nominal bond provides security as required by Rule 684.

4. A party seeking a temporary injunction must show that it will

suffer an imminent and irreparable harm if the injunction is not granted.

See Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex. 2002). The only

evidence of any harm to ES3 from Appellants’ actions was in the “vibes”

ES3’s president claims to have gotten from his customers.

Issue Presented: Whether a change in the “vibes” in the marketplace is sufficient to demonstrate an imminent and irreparable harm.

17 5. An injunction should not be so broad as to enjoin a defendant

from lawful activities. Lagos v. Plano Econ. Dev. Bd., 378 S.W.3d 647, 650

(Tex. App.—Dallas 2012, no pet.). The Temporary Injunction, however,

exceeds the restrictions in the covenant not to compete by extending the

restrictions beyond Texas and past two years after an employee’s

termination.

Issue Presented: Whether a temporary injunction granted on a covenant not to compete may restrain conduct that does not violate the covenant’s restrictions.

18 STATEMENT OF JURISDICTION AND STANDARD OF REVIEW

A. Jurisdiction.

The Court has jurisdiction under Texas Civil Practice and Remedies

Code Section 51.014(a)(4), which provides that a party may appeal from an

interlocutory order of a district court that grants a temporary injunction.

Prior to transfer, the Eighth Court of Appeals granted an extension of time

for Appellants to file their notice of appeal, and Appellants timely perfected

their appeal on December 20, 2024.

This case was originally appealed to the Third Court of Appeals at

Austin, Texas, which has jurisdiction over cases brought from Travis

County, Texas. The case was then transferred to the Eighth Court of

Appeals at El Paso, Texas for docket equalization purposes pursuant to

Texas Government Code Section 73.001. After the underlying lawsuit was

removed to the Business Court, this appeal was transferred to this Court

under Texas Rule of Appellate Procedure 27a(c).

B. Standard of Review.

The purpose of a temporary injunction is to preserve the status quo of

the litigation’s subject matter pending a trial on the merits. Butnaru, 84

S.W.3d at 204. A temporary injunction is an extraordinary remedy and will

not issue as a matter of right. Id. To obtain a temporary injunction, the

19 applicant must plead and prove that it (1) has a cause of action against the

opposing parties; (2) has a probable right on final trial to the relief sought,

and (3) faces probable, imminent, and irreparable injury in the interim. Id.;

Taylor Hous. Auth. v. Shorts, 549 S.W.3d 865, 877–78 (Tex. App.—Austin

2018, no pet.).

The decision to grant or deny a temporary injunction is reviewed for

abuse of discretion. Butnaru, 84 S.W.3d at 211. The reviewing court views

“the evidence in the light most favorable to the trial court’s order, indulging

every reasonable inference in its favor.” Amend v. Watson, 333 S.W.3d 625,

627 (Tex. App.—Dallas 2009, no pet.).

However, “[t]he requirements of Rule 683 are mandatory and must be

strictly followed.” Totus Grp., LLC v. Pruitt Family Living Tr., No. 05-23-

01222-CV, 2025 Tex. App. LEXIS 907, at *12 (Tex. App.—Dallas Feb. 14,

2025, no pet. h.). Accordingly, “[a] trial court abuses its discretion by issuing

a temporary injunction order that does not comply with the requirements of

Rule 683.” Indep. Capital Mgmt., L.L.C. v. Collins, 261 S.W.3d 792, 795

(Tex. App.—Dallas 2008, no pet.).

20 STATEMENT OF FACTS

A. ES3 is a mineral-interest broker.

ES3 is a mineral-interest broker/aggregator. (CR 376.) That is to say

that ES3 buys mineral interests from owners and resells them to buyers

who may repackage them for sale as securitized instruments or develop for

extraction themselves. (CR 381; III RR 8:7–22.) The closing of the two

transactions—from mineral-interest owner to broker and from broker to end

buyer—are typically closed at the same time so that the broker does not

need to put its own capital at risk. (III RR 13:15–25.)

The basics of mineral-interest brokerage are simple. The identity of

mineral-interest owners can be ascertained from public records.

(III RR 26:25–27:11.) The broker then cold-calls the mineral-interest owner

to solicit a sale. (III RR 27:12–23, 56:1–5.) It’s straight sales—prior industry

knowledge is neither needed nor even particularly desirable. (CR 386−87;

II RR 46:19–47:1, 50:9–15.) Instead, it is a strong sales background and

capability that is essential to success in the acquisition of mineral interests.

(CR 386−87; III RR 21:12–22:6.)

Once the broker buys a mineral interest, it resells the mineral interest

to private end-buyers and to publicly traded end-buyers. (III RR 19:18–

21 20:23.) The identities of these end-buyers is no secret; it is reflected in the

real-property records of each county. (III RR 22:23–24:7.)

But more importantly, the buyers do not want their identities to be

secret. The buyers are in the business of buying mineral interests, and they

accordingly want the world of mineral sellers and brokers to know that they

are open for business and willing to buy mineral interests. (III RR 24:8–20.)

Accordingly, the mineral-interest buyers actively advertise themselves to

brokers through industry publications, conferences, and networking.

(III RR 24:12–17; 88:21–89:10.)

ES3 is one of approximately 100 broker/aggregators buying and

selling mineral interests in Texas. (III RR 22:12–22.) It has a roughly

proportionate share of the market in mineral interests as reflected in the

public records of the acquisitions by two end-buyers: Hatch Resources and

Mesa Resources. Since ES3’s inception, ES3 has sold five mineral interests

to Hatch. (III RR 86:23–87:13.) Over that same period, Hatch has acquired

295 mineral interests from other broker/aggregators during that time.

(III RR 86:23–87:13.) Over the same period, Mesa has acquired

approximately 200 mineral interests, only five of which were purchased

from ES3. (III RR 87:14–88:6.)

22 B. ES3 hires Ryan to convince mineral-interest owners to sell to ES3.

ES3 hired Ryan initially as a “Producer” based on Ryan’s two decades

of sales experience. (III RR 54:22–55:6, 55:22–25.) Owing to Ryan’s success

in that position, ES3 promoted him to Vice President of Acquisitions.

(II RR 54:22–55:6.) Ryan led ES3’s efforts to convince mineral-interest

owners to sell to ES3 in his role as Vice President of Acquisitions.

(II RR 55:3–19.) Ryan’s efforts to acquire mineral interests on behalf of ES3

were limited exclusively to the Permian Basin. (III RR 59:13–18.)

C. ES3 taps Ryan’s sales knowledge and experience to develop its software platform.

In the course of his work for ES3, Ryan took a central role in

developing ES3’s software platform, which it calls “Rainmaker.”

(III RR 56:23–58:2.) When Ryan started at ES3, ES3 simply used

spreadsheets to organize its sales leads. Its sales staff had to manually look

up telephone numbers and other contact information to contact potential

sellers. (III RR 57:14–17.)

Ryan changed that.

Ryan explained how customer-relationship-management (“CRM”)

platforms provide the type of functionality needed to facilitate sales.

(III RR 56:23–57:7.) Using his sales experience in other industries, Ryan

23 explained how much data could be captured and the value of using that data

in sales. (III RR 57:17–24.) ES3 took Ryan’s suggestions to heart and

incorporated his ideas into the development of Rainmaker. (III RR 57:25–

58:2.)

D. Ryan leaves ES3 in 2021 and is subsequently rehired.

In 2021, Ryan resigned his employment with ES3, explaining that he

was tired of the minerals-brokerage business and wanted to go into the

semiconductor industry. (II RR 57:14–25.) Ryan departed on good terms,

with ES3 “leav[ing] the door open” to rehiring him. (II RR 57:23–25.) A

month later, ES3 did exactly that—it rehired Ryan to his previous position.

(II RR 58:1–15.) Ryan did not sign a new noncompetition agreement when

he was rehired.

E. ES3 hired Kreines to lead its efforts to sell the mineral interests that Ryan acquired.

ES3 recruited Kreines in 2019 to lead its Business Development

Department. (CR 392.) Kreines has been a landman in Texas since 2010,

and used his existing contacts to market the mineral interests that Ryan

and his team acquired for ES3 to sell to end-buyers. (III RR 84:25–85:20.)

Over the course of his career as a landman, Kreines has developed a

large body of industry contacts. (III RR 78:13–25.) As ES3’s founder and

24 president, Trey Stanton, explained it, Kreines was “an extrovert” who “was

not afraid to go into a group of people and introduce” Stanton. (II RR 78:12–

79:15.) Stanton quickly realized that it “would be nice to have [Kreines] by

my side and kind of, you know, fostering and building continued

relationships on the—on behalf of ES3.” (II RR 79:12–15.)

Kreines used those contacts to develop ES3’s business. From his first

North American Prospect Expo (“NAPE”) conference with Stanton, Kreines

connected Stanton to his network. (III RR 85:18–20.)

F. ES3 requires its employees to sign non-competition agreements.

At the outset of Ryan’s and Kreines’s employment, ES3 required them

to sign a noncompetition agreement. (CR 382, 418−29.) ES3 did not require

Ryan and Kreines to sign the noncompetition agreement owing to their

positions in the company; ES3 requires all of its employees to sign the same

agreement irrespective of their title or job duties. (CR 382 at ¶ 26.)

Kreines expressed reluctance to sign the noncompetition agreement.

He had just moved his family to Austin to join ES3, and did not want to be

unreasonably restrained from working as a landman in the future.

(III RR 86:2–14.) Stanton assured him that the covenant not to compete

wouldn’t prevent him from getting a job after he left ES3. (III RR 86:1–10.)

25 Expressing the same conclusion, ES3’s general counsel told Kreines that he

thought the covenant not to compete was “garbage and not enforceable.”

(III RR 86:11–14.)

G. ES3 terminates Ryan for refusing to steal a consultant’s intellectual property.

In August 2023, ES3 hired a third-party consultant, Topaz

Consulting, to develop training materials for its sales personnel.

(II RR 59:17–60:8.) ES3 undertook to transcribe Topaz’s training materials

“and make it basically our own.” (II RR 60:1–61:5.)

When Stanton explained his intention to copy all of Topaz’s training

materials and rewrite it as ES3’s own without Topaz’s consent, Ryan

refused. (III RR 60:19–61:12.) A few days later, ES3 fired Ryan.

(III RR 62:7–10.)

H. Ryan starts LMP to act as a mineral broker and secures its first AMI deal.

After his termination, Ryan started LMP and began trying to acquire

mineral rights. (III RR 63:3–20.) To do so, Ryan scoured county tax records

to identify mineral interests that may be for sale. (III RR 63:6–16.)

At the same time, word of Ryan’s departure circulated around the

industry. One industry player—Mesa Resources—reached out to Ryan over

LinkedIn and negotiated an “area of mutual interest” (“AMI”) deal with him

26 whereby LMP would act as a broker for Mesa’s acquisition of mineral

interests. (III RR 63:6–20, 64:6–25.) While LMP was eager to enter into an

AMI agreement, ES3 eschews such arrangements. (III RR 64:12–15.)

I. LMP hires an independent software designer to develop its own CRM platform to facilitate its business model.

Having its first AMI agreement in place, LMP hired a software

designer to develop a platform to support its AMI deals in December 2023.

(III RR 53:10–20, 69:6–25, 70:4–8.) LMP provided a basic outline of what it

wanted and the designer developed a platform to manage LMP’s brokerage

business. (III RR 70:9–24.) While LMP’s software platform is tailored to its

AMI-centric business, such CRM platforms are common in the industry.

(III RR 30:10–31:20.)

The differences in the companies’ software systems also derives from

their different philosophies when it comes to pricing. ES3 prices its mineral

interests for sale to buyers based on a multiple-of-cash-flow analysis.

(III RR 15:9–16:16.) ES3’s multiple-of-cash-flow analysis is a basic

valuation model that is common in the industry. (III RR 16:6–16.) In

contrast, LMP bases its pricing mainly off its agreements with its AMI

counterparties. (III RR 66:10–18.)

27 ES3 acknowledges that LMP’s software does not share the same code

as ES3’s software. (II RR 100:13–23.) And because LMP’s business is

different, the interfaces are different. (II RR 100:13–23.)

J. LMP sells its first mineral interest outside an AMI.

In late 2023, Mesa for the first time refused to buy a mineral interest

that LMP had purchased. (III RR 72:22–73:7.) At Kreines’s suggestion,

LMP contacted Hatch Resources to gauge its willingness to acquire the

mineral interest. (III RR 73:8–10.) After a negotiation between LMP and

Hatch, Hatch purchased the mineral interest from LMP. (III RR 72:22–

73:7.)

K. Kreines leaves ES3 in January 2024 to once more work as an independent landman.

In January 2024, Kreines resigned his employment to resume working

as an independent landman through his company, NAK Resources.

(II RR 73:23–75:6; III RR 83:24−84:6.) As an independent landman, Kreines

has worked with LMP since shortly after his resignation from ES3.

(III RR 84:1–9.)

L. ES3 and LMP have not competed with one another.

As discussed above, the mineral-brokerage business involves two

separate, though related, transactions: the acquisition of the mineral

28 interest from its owner and the resale of that interest to an end-buyer. On

neither side has LMP competed with ES3.

On the acquisition side, LMP and ES3 have never competed against

one another to acquire a mineral interest. (III RR 65:16–21.) As noted

above, the acquisition of mineral interests involves nothing more than a

series of cold calls and sheer luck. (III RR 27:12–23.) So it’s perhaps not

surprising that LMP and ES3 would not be cold-calling the same mineral-

interest owners.

Acquiring mineral interests, however, is critical to the broker’s

business. Without mineral interests, the broker has nothing to resell.

When it does obtain a mineral interest, ES3 turns around and

immediately resells the mineral interest to an end-buyer and

simultaneously closes the two transactions. (II RR 51:11–23.) Hence, ES3

does not sit on an inventory of mineral interests—it resells the mineral

interests it acquires as soon as it gets a deed in hand. (II RR 50:9–51:7.)

If ES3 is not selling as many mineral interests today as it did two

years ago, there’s only one possible reason for that: it doesn’t have as many

mineral interests to sell. But that’s not LMP’s fault. No mineral-interest

seller has ever rejected ES3’s offer in favor of one from LMP. (III RR 65:16–

29 21.) And LMP has never encouraged a buyer not to do business with ES3.

(IV RR at Defs.’ Ex. 21, 111:10–112:14.)

In fact, ES3 itself has no idea why it is not selling as many mineral

interests today as it did two years ago. As to his relationship with end-

buyers, Stanton could only observe that “the vibe has changed.”

(II RR 80:19–82:13.) But Stanton could not link that vibe-shift to anything

LMP has done, and he concedes that no buyer has indicated that they’re not

responding to ES3 because of work they’re doing with LMP. (II RR 82:10–

13.) When specifically asked by ES3’s counsel “Can you tell the Court what

customers you have lost over this year,” Stanton answered “They haven’t

specified that they’re not going to do business with me.” (II RR 46:3–13.)

M. The Travis County District Court issues the Temporary Injunction, which the Business Court modifies.

Alleging breach of Ryan’s and Kreines’s covenants not to compete and

a variety of other business torts, ES3 filed suit against Appellants on

September 18, 2024. ES3’s Original Petition sought a temporary

restraining order and temporary injunction, among other relief. After the

district court denied its application for temporary restraining order, ES3 set

its application for temporary injunction for October 29, 2024.

30 After a hearing, the district court granted the temporary injunction on

November 26, though the parties were not notified of the order until

December 19. Appellants noticed their appeal the following day.

Appellants subsequently removed this case to the Business Court on

December 23—i.e., within thirty (30) days after the issuance of an order

granting a temporary injunction—consistent with the provisions of Texas

Rule of Civil Procedure 355 and Texas Government Code

Section 25A.006(f)(2). The Business Court heard Appellants’ Motion to

Dissolve the Temporary Injunction for failure to meet the requirements of

Rules 683 and 684 on February 27, 2025. On April 7, 2025, the Business

Court issued its Order Modifying the Temporary Injunction. (2d. Suppl.

CR 307−33.)

31 SUMMARY OF THE ARGUMENT

The Temporary Injunction does not meet the specificity or reasoning

requirements of Rule 683. It is therefore void, and the order issuing the

injunction should be reversed.

Rule 683 requires that any order granting an injunction “describe in

reasonable detail . . . the act or acts sought to be restrained.” Tex. R. Civ. P.

683. Rooted in the Constitution’s due-process guarantee, the specificity

requirement means that an injunction must be clear, specific, and

unambiguous. “Restrained parties should be able to pick up a temporary

injunction order, read it, understand it, and not have to guess about what

they are prohibited from doing upon threat of contempt.” Clark v. Hastings

Equity Partners, LLC, 651 S.W.3d 359, 372 (Tex. App.—Houston [1st Dist.]

2022, no pet.).

The Temporary Injunction in this case does not meet that standard.

It bars Defendants from “negotiating or entering into any transaction with

any of Plaintiff’s Buyers.” (CR 998.) So far so good. But who are “Plaintiff’s

Buyers?”

That’s where things become murky.

32 The Temporary Injunction provides a list of more than a hundred

corporate buyers and more than a hundred “individual contacts” employed

by those entities. (CR 1000–03.) But “Plaintiff’s Buyers” is not limited to

that list. It also includes “any contact and/or decision maker who is/was

associated with” any of the listed entities.” (2d. Suppl. CR 343.)

So to comply with the Temporary Injunction, Appellants cannot just

pick up the order, read it, understand it, and not do business with a list of

people. They have to guess about whether every business partner:

• “was/is associated with” any of the listed entities, and

• is or was a “contact” or a “decision maker” during that association with one of the listed entities.

Adding to the guesswork, the list itself is designated as “confidential” under

the trial court’s Confidentiality and Protective Order, so Appellants can’t

ask a potential business partner whether it has ever been a “contact and/or

decision maker” with the listed off-limits buyers. Because Appellants have

to guess about whether they’re allowed to do a deal with a company, the

Temporary Injunction does not meet Rule 683’s specificity requirement.

Nor does the Temporary Injunction meet the Rule’s “reasoning”

requirement. Rule 683 requires that an order granting a temporary

injunction “set forth the reasons” why the court deems it proper to issue the

33 writ. Tex. R. Civ. P. 683. The Rule requires specifics, not mere conclusions.

IPSecure, Inc. v. Carrales, No. 04-16-00005-CV, 2016 Tex. App. LEXIS 6288,

at *56 (Tex. App.—San Antonio June 15, 2016, no pet.).

But conclusory statements are all the Temporary Injunction offers. It

characterizes the means by which harm will occur but does not explain the

reasons why irreparable injury will result without an injunction. It does not

explain why ES3’s losses would be difficult to measure (or even state that

they would be difficult to measure). Instead, the Temporary Injunction

simply states that “[a]ny suit for money damages would not be an adequate

remedy at law to protect Plaintiff’s rights.” Such a conclusory statement

does not meet Rule 683’s requirement.

The trial court presumably could not explain the need for an

injunction because there was none. The undisputed evidence before the trial

court was that ES3’s injury—insofar as it has one—is neither imminent nor

irreparable. ES3 has an adequate remedy at law. It is the same remedy

ES3 had for the thirteen months between the time LMP began operating

and when ES3 filed suit.

Moreover, the trial court’s explanation for the injunction is lacking

because the Temporary Injunction prohibits Defendants from engaging in

34 lawful conduct. The covenant not to compete is limited to Texas; the

Temporary Injunction contains no geographic restriction. The covenant not

to compete restricts Ryan’s activities for 24 months after the end of his

employment; the Temporary Injunction applies for more than four years

after Ryan’s 2021 termination.

In issuing a temporary injunction that was so contrary to the evidence,

the trial court abused its discretion. That abuse was multiplied when it

required only a nominal bond, contrary to the requirements of Rule 684.

Accordingly, the Court should reverse the decision of the district court to

issue the Temporary Injunction and remand the case to the Business Court

for further proceedings.

35 ARGUMENT & AUTHORITIES

The Rules governing the issuance of temporary injunctions are

mandatory and must be strictly followed. A temporary injunction that does

not meet the requirements of Rules 683 and 684 is “void and must be

dissolved.” Conlin v. Darrell Haun & Solarcraft, Inc., 419 S.W.3d 682, 687

(Tex. App.—Houston [1st Dist.] 2013, no pet.); accord Qwest Commc’ns

Corp. v. AT&T Corp., 24 S.W.3d 334, 337 (Tex. 2000).

The trial court abused its discretion when it issued a temporary

injunction that (1) did not meet the requirements of Rules 683 and 684 and

(2) was so contrary to the evidence that it ended up restraining Defendants

from engaging in lawful activities. The trial court’s order issuing the

Temporary Injunction should therefore be reversed.

A. The Temporary Injunction does not meet the requirements of Rules 683 or 684.

The Temporary Injunction neither describes in reasonable detail the

acts to be restrained nor sets forth the reasons supporting the undefined

restrictions imposed. Finally, the Temporary Injunction does not set an

adequate bond as security as required by Rule 684. Accordingly, the

Temporary Injunction is fatally defective, and the trial court’s issuance of

that defective order should be reversed.

36 1. The Temporary Injunction does not set out the reasons why ES3’s harm is irreparable as required by Rule 683.

The Temporary Injunction’s restrictions are not supported by the

findings made by the enjoining court. Rule 683 requires that an order

granting a temporary injunction “set forth the reasons” why the court deems

it proper to issue the writ. Tex. R. Civ. P. 683. “[I]n other words, the order

must explain the reasons why the court believes the applicant’s probable

right will be endangered if the writ does not issue.” IPSecure, Inc., 2016

Tex. App. LEXIS, at *56 (citing Tuma v. Kerr Co., 336 S.W.3d 277, 279 (Tex.

App.—San Antonio 2010, no pet.). “And, when setting forth the reasons for

granting a temporary injunction, the trial court must set forth specific

reasons, not merely make conclusory statements.” Id.

A statement is conclusory if it does not articulate the factual basis on

which it rests, effectively insisting that the reader accept the writer’s say-so

without explanation.” Home Asset, Inc. v. MPT of Victory Lakes Fcer,

No. 01-22-00441-CV, 2023 Tex. App. LEXIS 2890, at *5 (Tex. App.—

Houston [1st Dist.] May 2, 2023, no pet.) (citing Arkoma Basin Expl. Co. v.

FMF Assocs. 1990-A, Ltd., 249 S.W.3d 380, 389 (Tex. 2008)). Hence, a

temporary-injunction order must articulate reasons why irreparable harm

will occur, not merely assert that irreparable harm will occur. See Clark v.

37 Hastings Equity Partners, 651 S.W.3d 359, 373–74 (Tex. App.—Houston

[1st Dist.] 2022, no pet.).

Yet a conclusory statement about the supposed irreparable harm is all

the Injunction contains:

(2d. Suppl. CR 339.) According to the Injunction, “unless Appellants are

enjoined,” ES3 will lose “exclusive use of its Trade Secrets,” “deals with

specific buyers,” “gross profits,” and employees. (CR 997, ¶ 16.) But why?

Cf., Clark, 651 S.W.3d at 373–74. The Temporary Injunction offers only the

38 most conclusory statement that Ryan and Kreines have “diluted Plaintiff’s

goodwill.” But how?

Without answering the “why” and “how,” the Temporary Injunction’s

Paragraph 16 closely mirrors the conclusory findings in Clark. The

injunction in that covenant-not-to-compete case found “[t]he Respondents

have violated certain covenants contained in the said Securities Purchase

Agreement and will, if not restrained, likely engage in conduct that will

cause Petitioners to suffer immediate and irreparable injury, loss or

damage; and . . . the threatened damage to Petitioners is impossible to

accurately and fully assess.” Clark, 651 S.W.3d at 374. With no explanation

as to why the purported injury would be “immediate and irreparable,” the

First Court of Appeals concluded that the statement was conclusory and did

not meet the requirements of Rule 683. See id.

Likewise, in Kotz v. Imperial Capital Bank, the San Antonio Court of

Appeals concluded that a temporary injunction reciting that the applicants

“will suffer irreparable injury in their possession and use of the Subject

Property in the event that the requested injunctive relief is not granted” did

not meet the requirements of Rule 683. 319 S.W.3d 54, 56–57 (Tex. App.—

San Antonio 2010, no pet.). To comply with Rule 683, an injunction must

39 “set forth any underlying facts to support its finding” that an irreparable

injury will occur without the issuance of an injunction. Id. “At most, this

language characterizes by what means harm will occur unless Kotz is

enjoined from taking possession and use of the subject property—but does

not state or explain the reasons why irreparable injury will result absent an

injunction.” Id.

The Injunction here similarly “characterizes by what means harm will

occur unless” Appellants are restrained “but does not state or explain the

reasons why irreparable injury will result absent an injunction.” Cf., id. “In

general, harm is irreparable when the harmed party has no adequate

remedy at law.” Home Asset, Inc., 2023 Tex. App. LEXIS 2890, at *7 (citing

Kennedy v. Gulf Coast Cancer & Diagnostic Ctr., 326 S.W.3d 352, 360 (Tex.

App.—Houston [1st Dist.] 2010, no pet.). “So, for example, harm is

irreparable if the harm cannot be adequately compensated in damages or if

the damages cannot be measured by any certain pecuniary standard.” Id.

The Temporary Injunction does not state or explain any reasons why

those injuries cannot be remedied at law. As in Home Asset, the Temporary

Injunction “does not even explain why [ES3’s] losses would be difficult to

measure under the circumstances of this case.” Compare 2023 Tex. App.

40 LEXIS 2890, at *7, with CR 997 at ¶¶ 16–17. Instead, the Temporary

Injunction simply states in conclusory fashion that “[a]ny suit for money

damages would not be an adequate remedy at law to protect Plaintiff’s

rights.” (CR 997–98 at ¶ 17.)

The Temporary Injunction concludes that ES3 will suffer “the loss of

exclusive use of its Trade Secrets, the loss of deals with specific buyers, a

decrease in gross profits, and a loss of employees, which is likely to continue

unless Appellants are enjoined” because Appellants “have diluted Plaintiff’s

goodwill with Plaintiff’s Buyers and will continue to do so.” (CR 864 at ¶ 16.)

But why can those injuries not be remedied at law? The Temporary

Injunction here is silent. And why will this Injunction prevent those losses

when it does nothing to restrict Appellants from acquiring mineral

interests—i.e., the thing that the buyers want to buy? The Injunction offers

no answers; it provides only the conclusion of imminent and irreparable

injury.

As set forth by consistent Texas precedent, the Temporary

Injunction’s findings of imminent and irreparable harm are conclusory and

thus violate Rule 683. Accordingly, the Court should reverse the trial court’s

order issuing the Injunction.

41 2. The Temporary Injunction does not meet the specificity requirement of Rule 683.

Perhaps arising from the fact that the Injunction can’t explain the

reasons for its issuance, it also can’t identify exactly with whom Appellants

can’t transact business. But Rule 683 requires a temporary injunction to

“describe in reasonable detail . . . the act or acts sought to be restrained.”

Tex. R. Civ. P. 683. A specific description “describes the enjoined acts

without requiring inferences or conclusions about which persons might well

differ and without leaving anything for further hearing.” Whinstone US Inc.

v. Rhodium 30MW, LLC, 691 S.W.3d 47, 50–51 (Tex. App.—Austin 2024, no

pet.) (cleaned up).

Because an injunction is enforced with the threat of criminal

contempt, the specificity requirement of Rule 683 is rooted in the

Constitution’s due-process guarantee. Ex parte Jackman, 663 S.W.2d 520,

523 (Tex. App.—Dallas 1983, no writ). Hence, an injunction must “set forth

the terms of compliance in clear, specific and unambiguous terms so that

the person charged with obeying the decree will readily know exactly what

duties and obligations are imposed upon him.” Ex parte Chambers, 898

S.W.2d 257, 260 (Tex. 1995). “Restrained parties should be able to pick up

a temporary injunction order, read it, understand it, and not have to guess

42 about what they are prohibited from doing upon threat of contempt.” Clark,

651 S.W.3d at 372.

As the Texas Supreme Court has stated:

Where the court seeks to punish either by fine, arrest, or imprisonment for the disobedience of an order or command, such order or command must carry with it no uncertainty, and must not be susceptible of different meanings or constructions, but must be in the form of a command, and, when tested by itself, must speak definitely to the meaning and purpose of the court in ordering.

Ex parte Hodges, 625 S.W.2d 304, 306 (Tex. 1981). “In other words, to be

enforceable by contempt, the order must clearly, specifically, and

unambiguously state the conduct required for compliance.” In re Luther,

620 S.W.3d 715, 722 (Tex. 2021).

Given these requirements, the Temporary Injunction fails in

important and determinative ways. Listing the people with whom

Appellants cannot do business would provide certainty. But the Injunction

doesn’t do that. It instead creates an uncertain list that deprives Appellants

of notice of what they can and can’t do.

a. The Temporary Injunction does not define specific persons with whom Appellants cannot do business.

The Temporary Injunction’s list of customers with whom Appellants

cannot transact business lacks specificity. The list of entities and persons

43 whom are off-limits is specific. But the Temporary Injunction then contains

an additional catch-all:

(2d. Suppl. CR 343.) This additional term deprives the Temporary

Injunction of the specificity required by Rule 683.

Appellants do not know with whom they cannot transact business from a simple reading of the Temporary Injunction.

Appellants have no way of knowing whether an individual was a

“contact and/or decision maker” who “was associated” with the listed

entities. The Temporary Injunction fail to define who a “decision maker”

would be.

But even without knowing who would be a “decision maker,” the

Temporary Injunction would, if read broadly, include each and every person

who has been associated with the listed entities without a time constraint.

Appellants have no way of knowing the identity of every person who is or

has ever been a “contact” or “decision maker” at every one of the 100+

companies listed in the Temporary Injunction. The Temporary Injunction

therefore fails to notify Appellants what they’re enjoined from doing.

44 Not only does the Temporary Injunction fail to notify Appellants what

they’re restrained from doing, it doesn’t provide the trial court with enough

information to enforce it. Rule 683’s specificity requirement enables the

trial court to “determine whether the injunction has been violated.” Paul v.

Roy F. & JoAnn Cole Mitte Found., No. 03-21-00502-CV, 2023 Tex. App.

LEXIS 772 at *5 (Tex. App.—Austin Feb. 8, 2023, pet. denied). But without

the necessary specificity, enforcement is impossible without additional

evidence and inferences.

To enforce the Temporary Injunction, the Court would have to have

an additional hearing to take evidence on a potential buyer’s past

employment, the capacity in which the buyer was employed, and the buyer’s

job duties during that previous employment. That necessity renders the

Temporary Injunction invalid. See Whinstone US Inc. v. Rhodium 30MW,

LLC, 691 S.W.3d 47, 52 (Tex. App.—Austin 2024, no pet.); accord Tarr v.

Lantana Sw. Homeowners’ Ass’n, No. 03-14-00714-CV, 2016 Tex. App.

LEXIS 13372, at *11 (Tex. App.—Austin Dec. 16, 2016, no pet.) (dissolving

injunction in which the determination of “whether certain acts constitute[d]

a breach of the Declaration of Covenants would [have] require[d] inferences

45 and conclusions about which persons might disagree and would [have]

require[d] further hearing.”).

Appellants cannot conduct their own investigation to ensure compliance with the Temporary Injunction because its limitations are confidential.

Not only can Appellants not identify the scope of the Temporary

Injunction today, they can’t ascertain what it will be tomorrow. That’s

because the scope of the Temporary Injunction changes every time an

employee of one of the “Plaintiff’s Buyers” changes jobs. Aside from the

entities listed, the Temporary Injunction prevents Appellants from

transacting business with any entity that may employ a “contact” or

“decision maker” of one of “Plaintiff’s Buyers” in the future.

Under the Injunction, if a “contact” or “decision maker” has moved jobs

to Company X, which has never done business with ES3, then Company X

is added to the list of people with whom Appellants cannot transact

business. But how would Appellants know? Appellants could do a deal with

Company X wholly ignorant of the “contact’s” new employment.

To be safe, Appellants would have to ask each new potential business

partner whether it currently employs any “contact and/or decision maker”

associated with the entities listed in the Injunction. Doing so, however,

46 would violate the confidentiality designation placed on the list of off-limits

entities.

Such a Catch-22 is exactly the type of non-specificity that caused the

Dallas Court of Appeals to invalidate the temporary injunction in Computek

Computer & Office Supplies, Inc. v. Walton. See 156 S.W.3d 217, 222 (Tex.

App.—Dallas 2005, no pet.) (“Because these OEM clients are not specifically

named, we agree with Computek that it must ask every non-ABBA contact

it makes whether it was an OEM client during the relevant times, and that

question may be construed as ‘canvassing’ or ‘soliciting,’ and thus a violation

of the permanent injunction.”). Moreover, requiring Appellants to conduct

their own fact-finding to determine exactly what actions they’re restrained

from doing renders the Temporary Injunction void under Rule 683 even if

they could do that investigation without violating the trial court’s protective

order. See id.

b. By barring Appellants from doing business with unknown companies, the Temporary Injunction violates Rule 683.

The scope of the Temporary Injunction, which prevents Appellants

from doing business with certain mystery companies that can only be

identified after further fact-finding, has been consistently held to violate

47 Rule 683. Specifically, and in the context of enforcing a noncompete clause,

the Dallas Court of Appeals has concluded that Rule 683 requires an

injunction enjoining a party from doing business with clients to specifically

identify those clients. Computek Computer & Office Supplies, Inc., 156

S.W.3d at 223.

In Computek, the court held that an order enjoining a former employee

and his new employer from doing business with a non-exclusive list of clients

would require the Appellants to ask any potential client if it had ever done

business with the plaintiff. See id. at 221–23 (striking down injunction that

enjoined Computek from doing business “with any OEM client not listed on

Attachment A or that was a new account set up while Williams worked for

OEM.”). Apart from being insufficiently specific, that inquiry itself could be

seen as soliciting and thus a violation of the injunction. See id. at 221–22.

Therefore, the injunction lacked specificity under Rule 683 and was

unenforceable. Id. at 223.

Similarly, in In re Krueger, the Austin Court of Appeals rejected an

injunction that barred a company executive from “contacting any of Cru

Energy, Inc.’s investors or potential investors, or any other persons doing

business with or potentially a participant in the business of Cru Energy,

48 Inc.” No. 03-12-00838-CV, 2013 Tex. App. LEXIS 5984, at *24 (Tex. App.—

Austin May 16, 2013, no pet.). The court concluded that the prohibition

failed to inform the executive “of who he is enjoined from contacting, and it

requires him to infer the identity of those individuals based on his then-

existing knowledge of the company’s operations.” Id. The Temporary

Injunction suffers from the same infirmity as it requires Appellants to infer

the identity of companies with which they cannot transact business.

Likewise, in In re Luther, the trial court enjoined a hair stylist from

“conducting in-person services at the salon ‘in violation of State of Texas,

Dallas County, and City of Dallas emergency regulations related to the

COVID-19 pandemic.’” 620 S.W.3d 715, 722 (Tex. 2021). That injunction,

however, lacked specificity in two ways: (1) it did not “describe with

specificity which ‘in-person services’ were restrained,” and (2) it did not

specify “any particular state, county, or city regulation” that Luther “is being

commanded to stop violating.” Id. at 722–23.

Accordingly, “Luther could not know without analyzing a multitude of

regulations—state, county, and city emergency orders referenced in the

temporary restraining order, plus the federal guidelines they referenced—

49 what conduct was prohibited at any given time the temporary restraining

order was in effect.” Id. at 723. Such lack of specificity violated Rule 683.

The Temporary Injunction in this case requires a similar investigation

by Appellants to determine what conduct is prohibited at any given time.

Each time they do a deal, Appellants need to ask the party on the other side

of the table for a complete list of its employees. Appellants then presumably

need to ask each employee whether he or she has ever been a contact or

decision maker associated with any of the listed entities. Absent such a

detailed investigation, Appellants risk unwittingly negotiating or entering

into a transaction with a “Plaintiff’s Buyer” as that term is ambiguously

defined in the Injunction.

The Injunction thus follows the same formula found to be deficient in

Luther, Krueger, and Computek. Appellants do not know with whom they

can’t do business without analyzing the employment history of each

employee of every potential business partner. And the trial court cannot

enforce the Injunction without an evidentiary fact-finding. The Injunction

therefore violates Rule 683 and the Court should reverse the trial court’s

decision to issue it.

50 3. The bond required by the Temporary Injunction is inadequate and contrary to the evidence.

Texas Rule of Civil Procedure 684 requires that orders granting

temporary injunctions must set a bond. Tex. R. Civ. P. 684. Texas law

requires a bond to obtain a temporary injunction because the applicant does

not have to prove its entire case at the temporary-injunction hearing. See

DeSantis v. Wackenhut Corp., 793 S.W.2d 670, 686 (Tex. 1990).

“An injunction plaintiff need not establish the correctness of his claim

to obtain temporary relief, but must show only a likelihood of success of the

merits. Correspondingly, an injunction defendant has a lesser burden to

establish his right to recover on an injunction bond than would be required

in an ordinary action for malicious prosecution.” Id. The bond should

therefore adequately compensate the enjoined party for the damages caused

by the issuance of the injunction in the event it is dissolved. See id. at 685–

86.

The bond set in the Temporary Injunction does not accomplish that

purpose. It is instead a nominal bond that does not meet the requirement

established by Rule 684 to set a security. Because the bond fixed does not

provide adequate security to Appellants, the order issuing the Injunction

51 should be reversed. See Tex. R. Civ. P. 684; Qwest Commc’ns Corp. v. AT&T

Corp., 24 S.W.3d 334, 337 (Tex. 2000).

a. The trial court set a nominal bond that was unsupported by the evidence.

A bond must be set at an amount that will adequately protect the

enjoined party’s interests. DeSantis, 793 S.W.2d 685. For example, in

Franklin Savings Association v. Reese, the Austin Court of Appeals reversed

and remanded an injunction preventing the foreclosure of a home when the

bond was set at $10,000. 756 S.W.2d 14, 16 (Tex. App.—Austin 1988, no

writ). The court identified that the property at issue was valued at between

$25 million and $50 million and the interest accruing on the debt would

exceed $2 million over the life of the injunction. Id. As such, the court found

that the bond of $10,000 was inadequate to protect the enjoined party. Id.

The evidence before the trial court showed that LMP would be unable

to close five deals that were under contract. The inability to close those deals

alone would result in a loss of approximately $3,595,415.00 in gross revenue.

(CR 766–67.)

The testimony at the temporary injunction hearing echoed this

evidence. (II RR 71:17−21.) Aside from the contracts of which an injunction

could cause a breach, an injunction would impair LMP’s ability to do

52 business. With realized profits of $6.7 Million on gross revenue of $20.2

Million in the first ten months of 2024 (III RR 52:9–16, 71:22−25), the

damage to Appellants resulting from a ten-month temporary injunction is

far greater than $25,000.

b. The bond should have been set on the basis of lost revenue, but even a lost-profit standard would have resulted in a significantly higher bond amount.

To adequately protect LMP in the event that the injunction is later

dissolved, the bond should have reflected the lost gross revenue that LMP

is experiencing as a result of the Injunction. “The purpose of the bond is to

protect the defendant from the harm he may sustain as a result of

temporary relief granted upon the reduced showing required of the

injunction plaintiff, pending full consideration of all issues.” DeSantis, 793

S.W.2d at 685–86. In this case, the harm sustained is by not being able to

sell mineral interests LMP has acquired.

LMP still has to pay the original sellers for those mineral interests; it

still has to make payroll. It still has to keep the lights on (metaphorically

and literally). Lost profits do not protect Appellants from the harm they

have sustained from the void Injunction.

53 But even if the proper measure of the bond were restricted to lost

profits, that number would be vastly greater than $25,000. In the first ten

months of LMP’s operation, LMP realized profits of $6.7 Million on gross

revenues of $20.2 Million. (III RR 52:9–16, 71:22−25.) In the context of such

profits and revenues, a nominal bond of $25,000 is insufficient, and the trial

court’s order issuing the Injunction with an inadequate bond should be

reversed.

c. The nominal bond set by the trial court essentially eliminated the bond requirement altogether.

Against the amount in dispute and the likely losses caused by the

Injunction, a bond of $25,000 is nominal. Such a bond should be avoided.

As Justice Young stated in his dissent in Van Huis v. Marine Ventures, Ltd.,

a nominal bond “could be tantamount to dispensing the bond requirement

altogether.” 672 S.W.3d 22, 26 (Tex. 2023) (Young, J., dissenting).

That is the situation here. While the amount of the bond is within the

trial court’s discretion, the failure to require a bond renders an injunction

void. See Whitlow v. Polley, 670 S.W.2d 318, 319 (Tex. App.—Tyler 1984, no

writ). In a case in which (1) the undisputed evidence demonstrated that the

issuance of an injunction imperiled pending contracts worth $3,595,415.00,

(2) LMP realized profits of $6.7 Million over the preceding 10-month period,

54 and (3) ES3 affirmatively acknowledged the amount in controversy exceeds

$5 million when it did not challenge the removal of the case to the Business

Court, see Tex. Gov’t Code § 25A.004(b), a $25,000 bond is “tantamount to

dispensing with the bond requirement altogether.” Van Huis, 672 S.W.3d

at 26. It is, in effect, no bond at all.

In setting a nominal bond that effectively dispensed with the Rule 684

bond requirement, the trial court abused its discretion. The Temporary

Injunction is therefore void, and the order issuing it should be reversed.

B. The evidence does not support the issuance of a temporary injunction.1

The trial court could not state its reasons for issuing the Temporary

Injunction as required by Rule 683 because the evidence did not support it.

Instead, even taken in the light most favorable to ES3, the evidence

demonstrates that ES3 faces no probable, imminent, and irreparable injury

for which the extraordinary remedy of a temporary injunction is necessary.

1 ES3 attempted to offer and admit into evidence a number of exhibits en masse at the end of the hearing without a sponsor or foundation. As Judge Eiserloh stated at the conclusion of the hearing, the reason she normally doesn’t admit exhibits “without being sponsored by a witness” is because she then “doesn’t have anything to connect them to.” (III RR at 95:2–5.) Judge Eiserloh further explained, and as is evident by this record and the Temporary Injunction issued, “that’s kind of a bit of an issue.” (III RR at 95:6.)

55 “Establishing probable, imminent, and irreparable injury requires

proof of an actual threatened injury, as opposed to a speculative or purely

conjectural one.” Tex. Dep’t of Pub. Safety v. Salazar, 304 S.W.3d 896, 908

(Tex. App.—Austin 2009, no pet.). “[T]o support injunctive relief, the

commission of the act must be more than speculative and the injury that

flows from the act must be more than conjectural.“ Archon Design v. Naim,

No. 03-23-00226-CV, 2023 Tex. App. LEXIS 6740, at *13 (Tex. App.—Austin

Aug. 30, 2023, no pet.).

An injury is irreparable if damages cannot be measured or would not

adequately compensate the injured party. Butnaru v. Ford Motor Co., 84

S.W.3d 198, 204 (Tex. 2002). Breach-of-contract claims generally don’t meet

this standard. Archon Design, 2023 Tex. App. LEXIS 6740, at *13. The

evidence in this case confirms that ES3’s alleged injuries are not such as to

extract its case from that general rule.

1. There is no imminent and irreparable harm to ES3

ES3 failed to show that Appellants have caused it immediate and

irreparable harm. ES3 has not lost a single buyer or a single deal.

(III RR 65:16–21.) ES3 did not identify any present or future harm.

56 In reality, ES3 feels harmed by Defendants’ success in business.

Speculation, much less jealousy, is not a basis for enjoining a party. Huynh

v. Blanchard, 694 S.W.3d 648, 679 (Tex. 2024) (“An injunction will not lie to

prevent an alleged threatened act, the commission of which is speculative

and the injury from which is purely conjectural.”).

a. ES3’s injury was not “immediate.”

ES3 sought to enjoin Defendants in late September 2024 after LMP

had been in operation for over a year. (CR 393 at ¶ 50.) For a year, the

alleged competition from LMP was so non-injurious that ES3 was unaware

that LMP even existed. (CR 398, ¶ 68.)

ES3 has not identified how Appellants’ actions have caused it injury

beyond speculation. Huynh, 694 S.W.3d at 679. No buyer has refused to do

business with ES3 due to competition with LMP. (II RR 46:3−6.).

Defendants have never diverted or discouraged any buyer from buying

minerals from ES3. (IV RR at Defs.’ Ex. 21, at 111:18−112:14.) And LMP

has never competed against ES3 to acquire a mineral interest from a selling

owner. (IV RR at Defs.’ Ex. 21 at 85:19−23 (sealed).)

57 b. ES3 has not endured an injury requiring injunctive relief.

ES3 does simultaneous closings, or what is commonly known as

arbitrage, for the mineral interests it acquires. (III RR 13:15−21.) ES3 buys

a mineral interest from an owner, ES3 immediately turns it around to sell

that mineral interest to a buyer.

ES3 presented no evidence that LMP has ever competed with it on the

acquisition side because ES3 and LMP had never pursued the same mineral

interest held by a mineral owner. (III RR 65:16−21.) Such evidence would

be easy to produce as ES3’s software program keeps a record of ES3’s

correspondence with potential mineral sellers. (III RR 57:13−25, 58:1−2.)

ES3 has not and cannot point to a single acquisition that LMP procured that

ES3 also attempted to procure.

ES3 instead complains that Appellants were interfering with ES3’s

relationships with buyers and repeatedly defines the market of buyers as

“ES3 Buyers.” (CR 1214, 1329.) This description is misleading.

(III RR 26:14−20.)

ES3 paints the mineral-interest industry to be one in which each

buyer loyally purchases mineral interests from only one broker. But buyers

in the minerals industry are not loyal to a single broker; they purchase from

58 whomever has valuable mineral interests. (III RR 22:23–24:20.) Buyers are

like used-car dealerships, such as Carvana or CarMax. A used-car

dealership does not buy used cars from a single person—it buys from anyone

that has a used car that the dealership believes will be a worthwhile asset.

The used-car dealership may resell the car, break it down for parts, or

simply hold on to it while deciding what to do next. Buyers in the minerals

market similarly purchase mineral interests from brokers and either

repackage them for sale as securitized instruments or develop them for

extraction themselves. Buyers in the minerals market are ready to buy any

mineral interest that they believe will be a valuable asset from any broker

or seller. (III RR 25:24−25; 26:1−6.)

If ES3 procures valuable assets, there is a willing and ready market

ready to buy those assets. Alternatively, if ES3 has been injured (it has not),

it would be from LMP successfully procuring mineral interests out from

under ES3 such that ES3 did not have any inventory to sell to any buyers.

(III RR 22:7−11; 26:21−24.) But that is not the case. ES3 drafted and

submitted a temporary injunction to the trial court that enjoins the

divestiture side of dealing rather than the acquisition side.

Why?

59 Because ES3 cannot identify any competition or harm on the

acquisition side. And with no harm on the acquisition side, it cannot have

an injury on the sales side given the nature and dynamics of the industry.

c. ES3’s alleged damage to its relationship with buyers is speculative.

To further address any alleged damage on the buyers’ side of ES3’s

transactions, there is no evidence that any buyers are refusing to work with

ES3, just Stanton’s testimony that the “vibe” is different. (II RR 46:3−10.)

Stanton does not state that ES3 has done no deals with Tailwater or

Mesa, but rather “very little.” (II RR 46:6−7.) No buyer has refused to work

with ES3. It is unclear, merely speculative, as to why ES3 has not closed

more deals with a handful of buyers. It very well may be that ES3 has not

procured mineral interests that buyers find to be valuable. (III RR 22:7−11.)

Yet, ES3’s failure to complete deals is not evidence that Appellants have

diminished ES3’s goodwill in the minerals market.

Trey Stanton notably could not identify any damage to ES3 during his

deposition or testimony at the Temporary Injunction hearing tied to

Appellants’ actions. His inability to identify damages does not mean ES3

has an irreparable injury, it means ES3 does not have any injury. Without

60 damages, much less immediate and irreparable damages, the trial court

abused its discretion by issuing the injunction against Appellants.

2. The trial court improperly granted the Temporary Injunction because there is no probable right of relief on ES3’s claims.

This suit isn’t about ES3’s difficulties—it’s about LMP’s success. It’s

not about protection, but punishment.

Trey Stanton thinks that he has captured lightning in a bottle with

ES3. But as laid out by Steven Hatcher, Appellants’ industry expert, the

business of buying and selling mineral interests “is simple, it’s not easy.”

(See III RR at 36:3.) The mineral-brokerage industry is based on the use of

public records and valuation formulas that are general industry knowledge.

The only real barrier to entry is a healthy work ethic.

In its Third Amended Petition, ES3 pleads violation of the Texas

Uniform Trade Secrets Act, violation of the Texas Theft Liability Act, breach

of contract, breach of fiduciary duty by Nicholas Kreines, tortious

interference by LMP, and civil conspiracy by all of the Appellants. ES3’s

claims center on alleged violation of a non-compete by Ryan and Kreines

and alleged misappropriation of trade secrets. But in an industry that relies

on fundamental sales principles, in which buyers advertise, and in which

61 key customer data is reflected in the public tax rolls and the Texas Railroad

Commission website, these allegations are unsupported. And consequently

the temporary injunction record does not reflect a likely chance of success

on the merits.

a. This industry relies on the most basic principles of economics and marketing.

While adjacent to the oil-and-gas industry, the business of brokering

mineral interests is a simple and separate matter of real-estate

transactions, or even more simply, pure sales. You acquire mineral

interests and then you sell them. Trey Stanton in fact hired David Ryan

because of his strong background in sales. That’s consistent with the model

of this industry. As ES3 pleaded, there was no need for prior industry

knowledge. (CR 386−87; II RR 46:19–47:1, 50:9–15.)

Companies that buy mineral interests from brokers like ES3 actively

market themselves to brokers. They contact brokers through direct

communications on LinkedIn and other platforms, participation in industry

conferences, and regularly conducted social events. (IV RR at Defs.’ Ex 21,

79:3–81:1, Defs.’ Ex. 22, 116:6–122:21.) They offer brokers gifts as part of

their marketing efforts. (CR 396 at ¶ 60.)

62 In fact, buyers are so active in marketing themselves that LMP has

never had to solicit them. Every mineral interest LMP has sold has been

bought by a company that contacted LMP first. (III RR 78:24–25.) Again,

it’s a simple sales model; it makes sense that buyers buy. The temporary-

injunction record is devoid of any controverting evidence on this point.

b. ES3 identifies no trade secret that has been taken.

A finding of misappropriation of trade secrets requires trade secrets to

misappropriate. In this case, ES3 paints with a broad brush and covers

everything fundamental to the business of buying and selling mineral

interests as proprietary and confidential in an effort to support its claim that

the only way Appellants could work and succeed in this industry is through

misconduct.

The list and explanation of what is a “trade secret” has evolved over

the life of the underlying litigation to include the software platform,

simultaneous acquisition and divestiture transactions, creating siloed

departments, customer information, and pricing methodology. (Compare

CR 5–31 with CR 376–410.) However, not only are these not confidential

and proprietary matters, there are material differences in the way that LMP

and ES3 operate that defeat ES3’s claims.

63 Though the trial court made a conclusory finding that trade secrets

were misappropriated, the Temporary Injunction fails to identify the what

and the how.

Though there is overlap due to the nature of the industry, the two companies employ different business practices.

Included in the original petition and in the Agreements signed by

Ryan and Kreines are reference to “simultaneous closings.” (CR 396 at ¶ 61,

CR 419.) However, Trey Stanton and ES3 did not invent the concept of

simultaneous closings. Steven Hatcher, Appellants’ industry expert

testified that simultaneous closing is commonplace in the industry and that

he himself uses it. (III RR 13:15–14:1.) And as Ryan testified, the

simultaneous closing method is not even unique to this industry, as he used

the simultaneous closing, or arbitrage, model when he was working in the

semiconductor industry. (III RR 58:18–59:4.)

Stanton prides himself on silos within ES3, whereby he could bring in

people with no industry knowledge. (II RR 46:16–47:1.) He walled these

groups off from one another, restricting information between them. (II RR

47:6–8.) Though he now says that it was to prevent someone from

64 replicating what he built, what he portrayed to ES3 employees was about

efficiency—not confidentiality. (II RR 47:9–12.)

But while having internal silos is not unique to ES3, it is unique as

between ES3 and LMP. ES3 segregates its employees into different

departments; LMP actively encourages collaboration between teams. Even

if siloing could be considered a trade secret, there is no evidence in the record

that Ryan, Kreines, or LMP took advantage of that in their dealings after

ES3. (III RR 19:10–17.) And as Ryan himself was an industry outsider who

was siloed while at ES3, his ability to start LMP lends support that this is

an industry with low barriers to entry and has a public facing nature.

Stanton’s claims are undermined by the perceived threat this lawsuit

evidences.

Silos are not the only difference between ES3’s and LMP’s operations.

LMP has actively sought AMI agreements with end buyers; ES3 eschews

such arrangements, and never agreed to an AMI in Texas while Kreines or

Ryan was working for ES3. (See III RR 65:12–15.) There is no evidence in

the record about why ES3 does not do AMIs or whether this material way

of going after and developing business could be attributable to the

differences in ES3’s profits. There is no development in the record of the

65 vague allegation that business methods were misappropriated, and thus

nothing to support a finding of misappropriation of trade secrets.

The only business methods identified by ES3 are (1) not trade secrets,

and (2) not used by LMP. Thus, it is unlikely that ES3 would or even could

succeed on the merits

There are material differences in the pricing formula stemming from the differences in business practices.

ES3 also cites its pricing method as a trade secret (without specifying

how or why). (CR 399 at ¶ 72.) LMP prices its deals based on an entirely

different model from ES3. ES3’s model prices its mineral interests for sale

to buyers based on a cash-flow analysis ES3 assigned a moniker to.

(III RR 15:9–16:16.) As Steven Hatcher noted, however, this supposedly

confidential pricing method is “effectively a derivative of a multiple of cash-

flow analysis.” (III RR 15:22–16:5.) This purported trade secret is “as basic

as it gets.” (III RR 16:11–16.) Thus, ES3’s multiple-of-cash-flow analysis is

a basic valuation model that is common in the industry. (III RR 16:6–16.)

In contrast, LMP bases its pricing mainly off its agreements with its

AMI counterparties. (III RR 66:10–18.) And as explained above, ES3 does

66 not engage in many (if any) AMI deals, so the pricing methodology would

necessarily deviate.

The two companies’ software platforms are different.

ES3 also alleged that LMP’s software was plagiarized from ES3’s

software. (CR 399 at ¶ 72.) There is no allegation that Ryan or Kreines

stole the code—in fact the uncontroverted testimony is that they never had

access. Further, neither Ryan nor Kreines are software engineers or

developers. (IV RR at Defs.’ Ex. 21 at 17:19–18:4.) They lacked the

opportunity and capability to support such a claim.

Instead, ES3 tried to claim “functional plagiarism”—the two platforms

performed some of the same functions. ES3 explained that its software as

“aggregat[ing] information and manipulat[ing] information from select

public sources, non-public sources, and proprietary sources.” (CR 378 at

¶ 7.) But there’s nothing unique about that concept. As ES3’s CEO

acknowledged, other data-aggregating customer relationship management

platforms can be bought off the shelf. (IV RR at Defs.’ Ex. 21, 45:2–48:8.)

LMP’s independent development of software that does what multiple other

well-known software platforms do is not actionable.

67 And as Plaintiff’s software expert, Dr. Mark Gianturco, acknowledged,

the two software platforms look very different. Gianturco focused on

functionality, but he readily acknowledged that he has no background in

this industry and thus doesn’t know what functionality is common to all

platforms used in the industry. (II RR 106:3–16.) The record before the trial

court made clear that to the extent there is overlap in functionality, the

incorporation and display of industry data (tax rolls, Railroad Commission

information, etc.) is information that all mineral interest brokers use.

(III RR 26:21–29:22.)

The fact that the software platforms have some overlap is no evidence

of plagiarism. As explained in the deposition testimony of Dr. Jeff Miller

admitted into the record at the temporary-injunction hearing, many

software platforms have similar functionality. But just because Google Docs

does word processing doesn’t mean that it is plagiarized from Microsoft

Word. (IV RR at Defs.’ Ex. 23 at Vol. 1, 18:7–19:21.) A review of the

platforms reveals functionality unique to LMP’s platform. (IV RR at Defs.’

Ex. 23 at Vol. 1, 60:17–19.)

68 For example, LMP’s platform is optimized working with an AMI. As

David Ryan described, LMP’s software allows it to run reports that ES3’s

software cannot. (III RR 69:3–25.)

Moreso than function, however, Gianturco’s opinion that LMP’s

software is derivative of ES3’s software came from his surmise that LMP’s

software could not have been built in two months if it didn’t have a head

start. The first and only time Gianturco reviewed LMP’s software was in

October 2024. (II RR 106:17–107:2.) Since it was initially developed, the

software has undergone constant and significant revisions. (IV RR at Defs.’

Ex. 23 at Vol. 1, 37:2–17.)

Gianturco is right—LMP’s software wasn’t built in two months; it was

built over the 12 months between when it was started and when he reviewed

it. (IV RR at Defs.’ Ex. 20, 54:10–13.) To put that into context, Stanton

testified that it took him only six months to develop ES3’s software. (IV RR

at Defs.’ Ex. 21, 43:8–20.)

While the trial court correctly excluded the software from its findings

in the Temporary Injunction, the evidence presented on the software

platform speaks to the larger theme here: ES3 can see no way anyone could

69 compete in this space without copying ES3. The evidence, however, does

not support that supposition.

The identities of ES3’s buyers are not secret.

The buyers of mineral interests from ES3 don’t belong to ES3—they’re

companies that buy from any broker willing to sell mineral interests. (IV RR

at Defs.’ Ex. 22 at 116:6−122:21.) Not only are they readily identifiable from

a review of county deed records, mineral-interest buyers make sure that

nobody has to go to that effort to find them. (IV RR at Defs.’ Ex. 22 at

121:25−124:19.)

Nicholas Kreines already had a well-established network prior to his

tenure at ES3. As Stanton testified, when they reconnected at NAPE

Kreines introduced Stanton to Kreines’s preexisting network. (II RR 79:6–

12, 16–19.) Stanton brought Kreines to keep “fostering and building

continued relationships.” (II RR 79:12–15.)

The buyers in the mineral brokerage space buy from any broker with

mineral interests to sell—whether it be from LMP, ES3, or any one of the

hundred other brokers in the market (with which both Hatch and Mesa have

done hundreds of deals). Hatcher made clear that no end buyer buys

exclusively from a single broker. Buyers advertise their desire to buy

70 mineral interests to the wide world in industry publications. They advertise

the price at which they buy to anyone with a mineral interest to sell.

These buyers weren’t exclusive to ES3. They weren’t exclusive to

LMP. As Stanton testified, the same companies he complains LMP was

working with do business with others. (II RR 80:11–15.) He doesn’t know

the number of deals, only that the buyers acquire interests from multiple

sources. (II RR 80:16–18.) There are in fact numerous companies that

compete with ES3 for mineral interests (IV RR at Defs.’ Ex. 21 at 54:23–

55:20.) But ES3 doesn’t know what business method those companies use

or how it is different from ES3’s. (IV RR at Defs.’ Ex. 21 at 115:4–19.) And

ES3 acknowledges that those companies are not relying on a business

method stolen from ES3. (IV RR at Defs.’ Ex. 21 at 54:23–56:3.)

Setting aside ES3’s telling lack of interest in exploring how other

competitors might be affecting his business, if the buyer and contact

information was confidential, how would those other individuals and

entities do business with the same buyers? The clear answer—and the

answer that is in the record—is that the buyers seek out deals. They are

the ones doing the courting.

71 c. The evidence doesn’t support ES3’s allegation that Ryan and Kreines have breached an enforceable covenant not to compete.

Nor does the evidence support the issuance of a temporary injunction

on the basis of the covenant not to compete. “The hallmark of enforcement

is whether or not the covenant is reasonable.” Marsh USA Inc. v. Cook, 354

S.W.3d 764, 777 (Tex. 2011). Ryan is not breaching his covenant not to

compete—its restrictions expired. Moreover, Ryan’s and Kreines’s

covenants not to compete are unenforceable under Texas law, and cannot

form the basis for an injunction.

David Ryan has not breached the covenant not to compete.

As both Ryan and Stanton testified, Ryan resigned from ES3 in 2021.

(II RR 57:14–18; III RR 42:8–10.) Though he later rejoined ES3, he did not

sign a new contract. (II RR 17:6–10.) The two-year restriction on Ryan thus

lapsed in 2023.

There is no tolling language in the agreement between Ryan and ES3.

The agreement expressly states that “Accordingly, Employee agrees that,

during employee’s employment with ES3 and for twenty-four (24) months

thereafter, regardless of the reason for or manner of termination, Employee

will not, directly or indirectly” compete with ES3, accept employment or

72 have an ownership interest in a competing business, solicit customers, or

discourage customers from doing business with ES3. (CR 420–21.) The

relevant language is clear. See Citation 2002 Inv. Llc, & Endeavor Energy

Res., L.P. v. Occidental Permian, 662 S.W.3d 550, 554–55 (Tex. App.—El

Paso 2022), aff’d, 689 S.W.3d 899 (Tex. 2024) (contracts should be enforced

based on what is expressed within the “four corners” of the agreement and

“[a]mbiguity does not arise merely because parties assert differing

interpretations.”). The trigger for the two-year restriction was the ending of

Ryan’s employment “regardless of the reason for or manner of termination.”

Ryan complied with that restriction. After his employment at ES3

ended in 2021, he did not compete with ES3. Instead, he went back to work

in the semiconductor industry. He then returned to ES3—the opposite of

competition. But he did not enter into a new agreement restricting his

activities after his second stint of employment ended. The Temporary

Injunction enforcing a covenant not to compete with which Ryan fully

complied therefore runs contrary to the totality of the record evidence.

The covenants are not supported by consideration.

A covenant not to compete is enforceable only “if it is ancillary to or

part of an otherwise enforceable agreement at the time the agreement is

73 made.” Tex. Bus. & Com. Code § 15.50(a). Under this statutory

requirement, there must be a nexus between the consideration provided to

the employee and the restrictions imposed. See Marsh USA Inc., 354 S.W.3d

at 775–76. “Consideration for a noncompete that is reasonably related to an

interest worthy of protection, such as trade secrets, confidential information

or goodwill, satisfies the statutory nexus.” See id.

In conclusory (and implausible) fashion, ES3 asserts that everything

it does is confidential. (IV RR at Defs.’ Ex. 21, 110:6–16.) But the reality is

that virtually everything ES3 does is the general practice that everyone else

in the hundreds-of-players industry follows. ES3 didn’t give Kreines and

Ryan any confidential information; it gave them (at most) general industry

knowledge. But general industry knowledge is not a trade secret. See

Stewart & Stevenson Servs. v. Serv-Tech, Inc., 879 S.W.2d 89, 95 (Tex.

App.—Houston [14th Dist.] 1994, writ denied).

Moreover, as Stanton testified, ES3 silos its employees specifically to

ensure that they do not have access to its trade secrets. (II RR 47:6–16.)

Ryan and Kreines did not have access to ES3’s software; only to a small

portion of it. (Id.) And to the extent that any of ES3’s business methods or

74 practices are trade secrets, the siloing of Ryan and Kreines prevented them

from having knowledge of them.

Because ES3 did not provide consideration that was reasonably

related to any business interest worthy of protection, it is not enforceable

under the Act.

The restrictions in the covenants not to compete are unreasonable.

With no actual trade secrets, ES3 relies on an unenforceable covenant

not to compete to try and destroy LMP and the livelihoods of Ryan and

Kreines.

A) The temporal restriction is unreasonable.

In this case, the two-year restriction is unreasonable when (1)

Hatcher’s testimony is that an outsider could come into the industry and

start competing in a few months and (2) Stanton testified that he recruits

from outside the industry because sales experience is more important than

any industry knowledge. (II RR 46:14–47:1; CR 386–87 at ¶ 34.) No

evidence was presented at the hearing or is in the record to support the

length of the restriction.

75 B) The geographic restriction is unreasonable.

A geographic restriction for the entire state of Texas is unreasonable.

As Ryan testified, his work with ES3 was limited to the Permian Basin.

(III RR 59:13–18.) There was no evidence presented by ES3 as to why Texas

was a reasonable geographic restriction.

C) Industry-wide restriction is invalid as a matter of Texas law.

ES3’s definition of a competing business contains an industry-wide

restriction. An industry-wide restriction, however, is unreasonable as a

matter of law. Peat Marwick Main & Co. v. Haas, 818 S.W.2d 381, 386–88

(Tex. 1991).

ES3 alleges Appellants violated the agreement by being in the same

business space—not competing over a specific deal. David Ryan testified

that LMP and ES3 have never bid against one another on any acquisition

deal. And Trey Stanton agreed. (IV RR at Defs.’ Ex. 20 at 85:19–23.) But

ES3 offered no evidence that it had ever sought to buy any of the mineral

interests that LMP has acquired.

In this case, the absence of evidence is evidence of absence as to

competition. And a restriction as broad as the one in the non-competes is

not enforceable.

76 The Covenants Not to Compete Act, Tex. Bus. & Com. Code § 15.51, et

seq., sets out the framework and requirements for crafting valid and

enforceable non-compete agreements. The statute’s “core inquiry is whether

the covenant contains limitations as to time, geographical area, and scope

of activity to be restrained that are reasonable and do not impose a greater

restraint than is necessary to protect the goodwill or other business interest

of the promissee.” Marsh US, Inc., 354 S.W.3d at 777.

Again, the statewide geographic restriction is unreasonable when

Ryan and Stanton testified that they only did deals in the Permian Basin.

And the industry-wide restriction is unreasonable as a matter of law. Peat

Marwick Main & Co., 818 S.W.2d at 386–88.

3. The Temporary Injunction does not contain a geographic restriction, thereby barring Appellants from engaging in lawful activity.

Not only did the trial court enforce an overbroad covenant not to

compete; it went beyond the overbroad restrictions in the covenant not to

compete and erased any geographic restriction. The enabling statutory

authority for the non-compete states that:

Notwithstanding Section 15.05 of this code, and subject to any applicable provision of Subsection (b), a covenant not to compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement at the time the agreement is made to the

77 extent that it contains limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and do not impose a greater restraint than is necessary to protect the goodwill or other business interest of the promisee.

Tex. Bus. & Com. Code § 15.50 (emphasis added).

The covenants not to compete included a geographic scope limiting its

restrictions to the State of Texas:

(CR 421 (emphasis added).) The relevant language in the documents signed

by Ryan and Kreines is identical. (See also CR 427.)

The Temporary Injunction contains no geographic restriction. (See

CR 871–77.) Challenge to the enforceability of the Agreements

notwithstanding, the non-competition language in the Agreements that was

signed by the parties restricts prohibited conduct within Texas. By failing

to include any geographic imitation, the trial court put in restrictions to

which the parties did not agree.

78 Texas courts have rejected temporary injunctions that fail to adhere

to the requirements for a valid non-compete agreement. In Parker v.

Schlumberger Tech. Corp., the non-compete agreements that were executed

by the parties were to last for one year. 475 S.W.3d 914, 928 (Tex. App.—

Houston [1st Dist.] 2015, no pet.) The temporary injunction issued by the

trial court, however, extended to the time of trial—significantly outlasting

the one-year period contained in the contracts themselves. Id. at 921.

Accordingly, the First Court of Appeals held the injunction to be invalid

because it barred competition that would be legal and not prohibited by the

noncompetition agreement. See id.

The lack of geographic restriction in this Temporary Injunction is

exactly like the lack of temporal restriction in the Parker case. An essential

term is missing, invalidating the Temporary Injunction.

CONCLUSION AND PRAYER

The evidence introduced at the temporary-injunction hearing

therefore did not support the restrictions contained in the Temporary

Injunction. Indeed, because there was no evidence of an imminent or

irreparable harm, the trial court erred in issuing any temporary injunction

at all.

79 The lack of evidence to support a temporary injunction prevented the

trial court from explaining the reasons for its issuance. But such an

explanation is required by Rule 683. So are specific restrictions that

Appellants can understand and abide by, but the Temporary Injunction

omits those, too.

For these reasons, Appellants therefore respectfully ask the Court to

reverse the order of the district court and render judgment dissolving the

Temporary Injunction.

Respectfully submitted,

LLOYD GOSSELINK ROCHELLE & TOWNSEND, P.C. 816 Congress Avenue, Suite 1900 Austin, Texas 78701 (512) 322-5800 Phone (512) 472-0532 Facsimile

By: /s/ James F. Parker JAMES F. PARKER State Bar No. 24027591 jparker@lglawfirm.com GABRIELLE C. SMITH State Bar No. 24093172 gsmith@lglawfirm.com SYDNEY P. SADLER State Bar No. 24117905 ssadler@lglawfirm.com

ATTORNEYS FOR APPELLANT

80 CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing document has been sent to the following counsel of record, in accordance with the Texas Rules of Appellate Procedure, via the Court’s electronic case filing system and electronic transmission on this 2nd day of September, 2025:

Michael D. Marin mmarin@boulettegolden.com Tori B. Bell tori@boulettegolden.com BOULETTE GOLDEN & MARIN L.L.P. 2700 Via Fortuna, Suite 250 Austin, TX 78746

ATTORNEYS FOR APPELLEE

/s/James F. Parker JAMES F. PARKER

81 CERTIFICATE OF COMPLIANCE

I, James F. Parker, attorney for Appellants, certify that this

document was generated by a computer using Microsoft Word 365, which

indicates that the word count of this document is 11,745 per Tex. R. App.

P. 9.4(i).

/s/James F. Parker JAMES F. PARKER

82 INDEX OF APPENDICES

Tab A November 26, 2024 Temporary Injunction (CR 860−66)

Tab B April 7, 2025 Order Modifying Temporary Injunction (2d. Suppl. CR 307−33)

Tab C April 7, 2025 Temporary Injunction (2d. Suppl. CR 334−46)

Tab D Confidentiality, Non-Competition and Non-Solicitation Agreement of David P. Ryan (CR 419−23)

Tab E Confidentiality, Non-Competition and Non-Solicitation Agreement of Nick Kreines (CR 425−29)

Tab F Tex. Bus. & Com. Code § 15.50

Tab G Tex. Gov’t Code § 25A.004

Tab H Tex. Gov’t Code § 25A.006

Tab I Tex. R. Civ. P. 355

Tab J Tex. R. Civ. P. 683

Tab K Tex. R. Civ. P. 684

83 TAB A 12/18/2024 01:43:31 PM Velva L. Price District Clerk Travis County D-1-GN-24-006854 CAUSE NO. D-1-GN-24-006854 IN THE DISTRICT COURT

Gr Lr Lr? Sr? Or ES3 MINERALS, LLC,

Plaintiff,

v.

LN NICHOLAS KREINES, DAVID P. RYAN, LIBERTY MINERAL PARTNERS LLC, NAK RESOURCES INC, CGR OIL AND GAS, LLC,

Lr LP? Defendants. TRAVIS COUNTY, TEXAS LE TEMPORARY INJUNCTION On October 29-30th, 2024, the Court heard Plaintiff ES3 Minerals, LLC's ("Plaintiff' or

"ES3") Application for Temporary Injunction, and took it under advisement. The Court also asked

the Parties to provide a ten-page closing brief, which they did. The Parties also each filed briefs in

support of their respective positions.

The Court, after examining the pleadings and documents, the arguments of counsel, the

evidence presented, and all other matters properly before the Court, finds:

I. VALID CAUSES OF ACTION

1. Plaintiff has asserted valid causes of action.

I. PROBABLE RIGHT TO RELIEF

2. Plaintiff has shown a probable right to relief against Defendants Nicholas Kreines

("Kreines"), David P. Ryan ("Ryan"), and Liberty Mineral Partners LLC ("LMP").

A. DEFENDANT KREINES

3. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Kreines for (1) violations of trade secret

misappropriation under the Texas Uniform Trade Secrets Act (""TUTSA"), (2) breaches of

860 fiduciary duty, and (3) breaches of contract (confidentiality, non-solicitation-of-buyers, non-

solicitation-of-employees, and non-competition provisions).

4. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines kept and continues to use and disclose materials and information that are Plaintiff's trade

secrets to land deals for Defendant LMP, including deals with Plaintiff's Buyers; that Defendant

Kreines facilitated a deal for Defendant LMP with an existing Plaintiff Buyer while still employed

with Plaintiff; and that Defendant Kreines solicited and will continue to solicit Plaintiff's Buyers

and employees for Defendant LMP's benefit.

B. DEFENDANT RYAN

5. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Ryan for breaches of contract (non-solicitation-of-

buyers, non-solicitation-of-employees, and non-competition provisions). Plaintiff has also

sufficiently shown for this temporary injunction that the relevant provisions of Defendant Ryan's

contract did not change after his brief absence from the company.

6. The Court finds that Plaintiff will probably succeed in showing that Defendant

Ryan has made and will continue to make deals with Plaintiff's Buyers.

C. DEFENDANT LMP

7. The Court finds that Plaintiff will probably succeed in showing that Defendant

LMP tortiously interfered with Plaintiff's agreements with Defendants Kreines and Ryan

(including their noncompetition and non-solicitation provisions) and will continue to do so.

D. TRADE SECRETS MISAPPROPRIATED

8. The Court finds that Plaintiff will probably succeed on its claim that Plaintiffs

Buyer information, including buyer lists, pricing information, contact information for key-decision

makers, the specific asset preferences of those buyers, and the details of the mineral interest

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 2 of 7 861 purchases of those buyers are Plaintiff's trade secrets ("Trade Secrets"). The Court further finds

that Plaintiff will probably succeed on its claim that Plaintiff has taken reasonable measures under

the circumstances to keep this information secret, and this information derives independent

economic value, actual or potential, from not being generally known to, and not being readily

ascertainable through proper means by, other people who can obtain economic value from the

disclosure or use of the information. The Court further finds that Plaintiff will probably succeed

on its claim that Kreines misappropriated Plaintiff's Trade Secrets for his own benefit and the

benefit of LMP and will continue to do so.

E. BREACH OF CONTRACT AND INTERFERENCE 9. The Court finds that Plaintiff will probably succeed on its claim that, as a condition

of employment with Plaintiff, Defendants Kreines and Ryan entered into Confidentiality, Non-

Competition and Non-Solicitation Agreements with identical terms ("Kreines Agreement" and

"Ryan Agreement" respectively, and together, "Agreements.

10. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines has breached the Agreement's confidentiality provisions by taking, using, and disclosing

Plaintiff's Confidential Information for his own benefit and for the benefit of Defendant LMP.

11. In Paragraph 4 of their respective Agreements, Kreines and Ryan agreed to the

following restrictions during employment with ES3 and for twenty-four (24) months thereafter:

Non-Competition; Non-Solicitation of Customers and Prospective Customers. Employee acknowledges that in the course of fulfilling Employee's responsibilities to ES3, Employee will be a representative of the company to, and in some instances may be ES3's primary contact with, existing customers as of the Termination date and prospective customers with whom ES3 has contacted within the 24-month period preceding the Termination date (collectively, "Customers and Prospective Customers"). Employee agrees that the goodwill and relationships developed with ES3's Customers and Prospective Customers is a special, valuable and unique asset ofES3 and should be used for the exclusive benefit of ES3. Accordingly, Employee agrees that, during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless of the reason for or manner of termination, Employee

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 3 of 7 862 will not, directly or indirectly, except in connection with Employee's employment with ES3: ...

(c) induce, solicit or take away (or attempt to induce, solicit, or take away) any Customer or Prospective Customer of ES3 and/or encourage any Customer or Prospective Customer to discontinue or limit its relationship with ES3; ... or

(e) divert or discourage any Customer or Prospective Customer from entering into a business relationship with and/or obtaining products or services from ES3.

12. The Court finds that Plaintiff will probably succeed on its claim that: (a) Defendants

Kreines and Ryan have breached the Agreements' Non-Competition and Non-Solicitation

Provisions by using for their own benefit Plaintiff's' goodwill and that they have diluted Plaintiff's

goodwill with Plaintiff's Buyers; (b) Defendants Kreines and Ryan have induced, solicited and

taken away (and attempted to induce, solicit, or take away) Plaintiff's Buyers and have encouraged

Plaintiff's Buyers to discontinue or limit their relationship with ES3; (c) Defendants Kreines and

Ryan have diverted or discouraged Plaintiff's Buyers from entering into a business relationship

with and/or obtaining products or services from ES3; and (d) Defendant LMP was aware of

Defendant Kreines and Ryan's contractual obligations to Plaintiff and intentionally interfered.

13. The Court finds that Plaintiff's list of Plaintiff's Buyers attached to this order

(which is marked CONFIDENTIAL) are ES3 customers for whom Kreines was a representative

to and did business with on behalf of ES3 during the 24-month period preceding Kreines's

termination date of January 31, 2024, and specifically includes the entities on the list as well as

any subsidiaries, funds or other entities, formed by the listed entities for the purposes of executing

a transaction as well as entities the individual contacts on the list are currently working for, and

thus are within the definition of Customers and Prospective Customers under the Agreements

("Plaintiff's Buyers").

14. In Paragraph 5 of their respective Agreements, Kreines and Ryan agreed to "that,

during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 4 of 7 863 of the reason for or manner of termination, Employee will not, on behalf of Employee or any other

person or entity except ES3, directly or indirectly hire, solicit, induce or encourage (or attempt to

hire, solicit, induce or encourage) any employee or officer of ES3 to terminate his/her relationship

with ES3, without the prior written consent of ES3." The Court finds that Plaintiff will probably

succeed on its claim that Defendants Kreines and Ryan violated their Agreements by soliciting

Plaintiff's employees, including Curtis Menchaca, inducing them to terminate their employment

with Plaintiff and work for LMP.

15. The Court finds that Plaintiff will probably succeed on its claim that the

Agreements are valid, and the post-employment restrictions recited above were ancillary to or a

part of an otherwise enforceable agreement at the time the Agreements were made; ES3 performed

under the Agreements; and Defendants Kreines and Ryan violated the Agreements and continue

to do so.

III, PROBABLE, IMMINENT, AND IRREPARABLE HARM

16. The Court finds that Plaintiff has shown there would be a probable imminent, and

irreparable injury from the actions it seeks to enjoin. Plaintiff has shown the loss of exclusive use

of its Trade Secrets, a loss of deals with specific buyers, a decrease in gross profits, and a loss of

employees, which is likely to continue unless Defendants are enjoined. Defendants Ryan and

Kreines were closely associated with Plaintiff's goodwill, and by their actions they have diluted

Plaintiff's goodwill with Plaintiff's Buyers and will continue to do so. Plaintiff's probable,

imminent, and irreparable injuries include:

a) Defendant Kreines's misappropriation of trade secrets.

b) Plaintiffs loss of goodwill and customers.

c) Defendants Kreines's and Ryan's breaches of their noncompetition agreements.

17. Any suit for money damages would not be an adequate remedy of law to protect

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 5 of 7 864 Plaintiff's rights.

IT IS, THEREFORE, ORDERED that, until the time of final trial on the merits: 1. DEFENDANT KREINES, and any person acting in concert or participation with him

who receives actual notice of this Order, is commanded forthwith through January 31, 2026, to

cease and desist, and otherwise refrain from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff's Buyers (as defined above);

b) Encouraging Plaintiff's Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff's employees or officers for employment or encouraging them to terminate their relationships with Plaintiff.

2. DEFENDANT RYAN, and any person acting in concert or participation with him who

receives actual notice of this Order, is commanded forthwith through August 23, 2025, to cease

and desist, and otherwise refrain, from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff's Buyers (as defined above);

b) Encouraging Plaintiff's Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff's employees or officers for employment or encouraging them to terminate their relationships with Plaintiff.

3. DEFENDANT LMP, and any person acting in concert or participation with LMP who

receives actual notice of this Order, is commanded forthwith to cease and desist, and otherwise

refrain, from tortiously interfering with Kreines and Ryan's agreements with Plaintiff not to:

a) Entering or negotiating any transaction with any of Plaintiff's Buyers (as defined above). This expires no later than twenty-four months after Defendants Kreines's and Ryan's terminations of employment with Plaintiff;

b) Encouraging Plaintiff's Buyers (as defined above) to discontinue or limit their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines's and Ryan's terminations of employment with Plaintiff; and

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 6 of 7 865 c) Soliciting any of Plaintiff's employees or officers for employment or encouraging them to terminate their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines's and Ryan's terminations of employment with Plaintiff.

IT IS FURTHER ORDERED that trial be set before the Court on August 18 , 2025, at 9:00 a.m.

The Clerk of the above-entitled Court shall forthwith, on the filing by Plaintiff of the bond

hereinafter required, and on approving the same according to the law, issue a temporary restraining

order in conformity with the law and the terms of this Order.

This Order shall expire at such time as this Court enters j udgment in this cause.

This Order shall not be effective unless and until Plaintiff executes and files with the Clerk

a bond, in conformity with the law, in the amount of twenty-five thousand dollars and 00/100

Dollars ($25,000.00).

SIGNED this 26th day of November 2024, at 4:50 o'clock p.m.

THE HONORABLE JUDGE EISERLOH 455th District Court

12/30/2024 03:21:08

[PROPOSED] TEMPORARY INJUNCTION ORDER Page 7 of 7 866 TAB B The Business Court of Texas, Third Division

ES3 MINERALS, LLC, § Plaintiff/Counter-Defendant, § § v. § NICHOLAS KREINES, DAVID P. § RYAN, LIBERTY MINERAL § Cause No. 24-BC03B-0005 PARTNERS LLC, NAK RESOURCES, § INC., AND CGR OIL AND GAS, LLC, § Defendants/Counter-Plaintiffs. § § ═══════════════════════════════════════ ORDER MODIFYING TEMPORARY INJUNCTION ═══════════════════════════════════════ Before the Court are two motions addressing the Temporary Injunction entered by

Judge Eiserloh on November 26, 2024, 1) Defendants’ Motion to Dissolve and 2)

Plaintiff’s Opposed Motion to Modify Temporary Injunction, Subject to Response to

Motion to Dissolve. As detailed below, the Court partially grants Plaintiff’s motion to

modify and modifies paragraph 13 and the corresponding “Ordered” section of the

Temporary Injunction, enters a Modified Temporary Injunction Order as reflected in the

attached Exhibit A, and denies all other relief requested.

2d. Suppl. CR 307 BACKGROUND

This lawsuit was filed in Travis County District Court on September 18, 2024. ES3

Minerals, LLC (“ES3”) moved for a temporary injunction that was heard on October 29,

2024 and October 30, 2024 by Judge Eiserloh. On November 26, 2024, the trial court

entered a temporary injunction against Defendants Nicholas Kreines (“Kreines”), David

Ryan (“Ryan”), and Liberty Mineral Partners LLC (“LMP”). In its seven-page injunction,

the trial court found that ES3 had asserted valid causes of action, shown a probable right

to recover on multiple claims, and had shown there would be a probable, imminent, and

irreparable injury from the actions ES3 sought to enjoin. The trial court enjoined Kreines,

Ryan and LMP from: 1) “Entering or negotiating any transaction with any of Plaintiff’s

Buyers”; 2) “Encouraging Plaintiff’s Buyers to discontinue or limit their relationships with

Plaintiff”; and 3) Soliciting any of Plaintiff’s employees or officers for employment or

encouraging them to terminate their relationships with Plaintiff.” 1 To identify the

prohibited transactions the order included the following definitional paragraph:

13. The Court finds that Plaintiff’s list of Plaintiff’s Buyers attached to this order (which is marked CONFIDENTIAL) are ES3 customers for whom Kreines was a representative to and did business with on behalf of ES3 during the 24-month period preceding Kreines’s termination date of January 31, 2024, and specifically incudes the entities on the list as well as any subsidiaries, funds or other entities, formed by the listed entities for the purposes of executing a transaction as well as entities the individual contacts on the list are currently working for, and thus are within the definition of Customers and Prospective Customers under the Agreements. 2

1 Temporary Inj. 6, Dec. 18, 2024. 2 Id. ¶ 13, Dec. 18, 2024 (emphasis added).

2d. Suppl. CR 308 Attached to the order was a list, deemed confidential by the trial court, of over 90

specific “ES3 Trusted Buyers” and approximately 200 associated contacts with whom the

Defendants were enjoined from negotiating a transaction.

After the temporary injunction was issued, Defendants removed this action to the

Texas Business Court on December 23, 2024. Defendants then filed Defendants' Motion

to Dissolve Temporary Injunction, ES3 filed their response, and Defendants filed a reply in

support. Plaintiffs then filed Plaintiff’s Opposed Motion to Modify Temporary Injunction,

Subject to Response to Motion to Dissolve and Defendants filed their response. Both

motions were heard on February 27, 2025.

In their motion, Defendants argue the temporary injunction is deficient in the

following ways: 1) it does not meet the specificity requirement of Rule 683 since it fails to

identify the specific customers with whom the Defendants are prohibited from transacting

business; 2) the temporary injunction does not set forth the reasons for its issuance in

violation of Rule 683; and 3) the bond amount set for the temporary injunction is

insufficient.

In its response, ES3 argues the injunction is sufficiently specific, that Defendants’

motion is an attempt to relitigate issues previously decided by the trial court, and the

injunction sufficiently sets forth the reasons for its issuance. In their motion to modify,

while not conceding the validity of Defendants’ motion, ES3 suggests modifications to the

temporary injunction aimed at addressing Defendants’ specificity contentions.

2d. Suppl. CR 309 ANALYSIS

To analyze the alleged deficiencies in the temporary injunction order, the Court

reviews relevant case law and the text of Texas Rules of Civil Procedure 683 and 684.

Legal Standard

The purpose of a motion to dissolve is to provide a means to show that changed

circumstances or changes in the law require the modification or dissolution of the

injunction; it is not to give an unsuccessful party an opportunity to relitigate the propriety

of the original grant.” 3 A respondent cannot use a motion to dissolve or a motion to modify

to relitigate the basis for the injunction when the basis has not changed. 4 Decrees of

injunction may be reviewed, opened, vacated or modified by the trial court upon a showing

of changed circumstances. 5 The determination of the question of whether to dissolve a

temporary injunction is a matter lying within the discretion of the trial court. 6 The trial

court has no duty, upon the filing of a motion to dissolve, to reconsider the propriety of the

granting of a temporary injunction, at least where the motion does not allege fundamental

error, and also where the motion is not based upon evidence of changed conditions but is

3 Tober v. Turner of Texas, Inc., 668 S.W.2d 831, 836 (Tex. App.—Austin 1984, no writ) ); see also, e.g., Gruss v. Gallagher, 680 S.W.3d 642, 660 (Tex. App.—Houston [14th Dist.] 2023, no pet.); Chase Manhattan Bank v. Bowles, 52 S.W.3d 871, 879 (Tex. App.—Waco 2001, no pet.); Murphy v. McDaniel, 20 S.W.3d 873, 877 (Tex. App.—Dallas 2000, no pet.). 4 Chase Manhattan Bank, 52 S.W.3rd at 879. 5 See Id. quoting (Smith v. O'Neill, 813 S.W.2d 501, 502 (Tex. 1991)). 6 Tober, 668 S.W.2d at 834.

2d. Suppl. CR 310 rather based upon evidence which was before the court at the prior hearing on the motion

to grant the temporary injunction. 7

Rule 683 and 684

Texas Rule of Civil Procedure 683 governs orders granting injunctions and

restraining orders and requires the order to set forth the reasons for its issuance, be specific

in its terms, and describe in reasonable detail the act or acts sought to be restrained. 8 The

requirements of Rule 683 “are mandatory, and an order granting a temporary injunction

that does not meet them is subject to being declared void and dissolved.” 9 A trial court's

failure to comply with an express requirement of Rule 683 is fundamental error; 10 it renders

the injunctive order void, rather than merely voidable. 11

“An injunction must be definite, clear, and concise, leaving the person enjoined in

no doubt about his duties, and should not call on him for interpretations, inferences, or

conclusions.” 12

7 Id. at 835. 8 TEX. R. CIV. P. 683. 9 Qwest Communs. Corp. v. AT&T Corp., 24 S.W.3d 334, 337 (Tex. 2000) (per curiam). 10 See Henke v. Peoples State Bank, 6 S.W.3d 717, 721 (Tex. App. —Corpus Christi 1999, pet. dism'd w.o.j.), abrogation recognized by Tex. Wrecker Serv. v. Resendez, No. 13-16-00515-CV, 2017 WL 711642, at *5 (Tex. App.—Corpus Christi–Edinburg Feb. 23, 2017, no pet.); Glennie v. Petty, 591 S.W.2d 951, 952 (Tex. App.—Tyler 1979, no pet.); United Farm Workers, AFL-CIO v. H.E. Butt Grocery Co., 590 S.W.2d 600, 606 (Tex. App.—Corpus Christi 1979, no writ) (holding that trial court’s entry of overbroad injunction was not fundamental error and modifying rather than reversing order). See, e.g., In re Luther, 620 S.W.3d 715, 721 (Tex. 2021) (orig. proceeding) (per curiam); Grounds 11

v. First GroundRock Royalties, LLC, 629 S.W.3d 674, 678 (Tex. App.—San Antonio 2021, no pet.); In re Chaumette, 456 S.W.3d 299, 307 (Tex. App.—Houston [1st Dist.] 2014, no pet.); In re Corcoran, 343 S.W.3d 268, 269 (Tex. App.—Houston [14th Dist.] 2011, no pet.). 12 Vaughn v. Drennon, 202 S.W.3d 308, 316 (Tex. App.—Tyler 2006, no pet.).

2d. Suppl. CR 311 Additionally, Texas Rule of Civil Procedure 684 requires a court granting any

temporary restraining order to set a bond, executed by the applicant, and filed with the

clerk. 13 The determination of the adequacy of the bond set by the trial court is to be made

on a case-by-case basis considering the record before the reviewing court. 14 The amount of

a bond is within the trial court's sound discretion and will not be disturbed on appeal absent

an abuse of that discretion. 15 The failure to require a bond in a sufficient amount does not

render an injunction void. 16

Application

The Court considers each of the Defendants’ contentions concerning the alleged

deficiencies in the temporary injunction order beginning with their allegations that the

injunction does not sufficiently specify who the parties are prohibited from transacting

business.

i. Specificity of Prohibited Acts

Defendants’ specificity arguments focus on portions of paragraph 13 that apply the

injunction to, not only the individually listed and named “Plaintiffs Buyer’s,” but

provisions that expand the definition of “Plaintiffs Buyer’s” to include:

13 TEX. R. CIV. P. 684. 14 IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191, 203 (Tex. App.—Fort Worth 2005, no pet.). 15 Id. 16 El Paso Dev. Co. v. Berryman, 729 S.W.2d 883, 888 (Tex.App.—Corpus Christi 1987, no writ).

2d. Suppl. CR 312 any subsidiaries, funds or other entities, formed by the listed entities for the purposes of executing a transaction as well as entities the individual contacts on the list are currently working for, and thus are within the definition of Customers and Prospective Customers under the Agreements. 17

Defendants argue this language does not meet the specificity requirement of Rule

683 for multiple reasons. They assert they have no way of knowing the corporate structure

of entities to whom they cannot sell mineral interests. To enforce the temporary injunction,

they claim, the Court would be forced to conduct an additional hearing to consider evidence

about the buyer’s corporate structure, the purpose for which a corporate structure was

organized, and the buyer’s roster of employees. Defendants also argue other courts have

rejected non-specific provisions included in similar orders. Defendants primarily cite three

cases in support of their arguments: In re Luther, Computek Computer & Office Supplies,

Inc. v. Walton and In re Krueger.

ES3 contends the temporary injunction issued by the trial court is sufficiently

specific. It argues it is common in the mineral industry for buyers to form transaction

specific entities and that Kreines, as the principal relationship manager to ES3’s Buyers for

several years, knows exactly which buyers are off-limits to him and Defendants. ES3 notes

the temporary injunction attaches a specific list of ES3’s Buyers and includes an

explanation of the entities and individuals that are off-limits. Finally, ES3 argues the

language concerning subsidiaries, funds, or other entities, and the language restricting

Defendants from doing business with individuals on the list, regardless of where they work,

is necessary to prevent circumvention of the injunction.

17 Temporary Inj. ¶ 13, Dec. 18, 2024.

2d. Suppl. CR 313 The Court first reviews Defendants’ cited cases: Luther, Computek, and Krueger.

In Luther, a Dallas salon owner sought relief from a contempt judgment issued

against her for violating a temporary restraining order that prohibited her from operating

in-person services during the COVID-19 pandemic. 18 Luther argued that the order was void

since it did not specify the exact conduct prohibited. 19 The Texas Supreme Court agreed,

ruling that temporary restraining order issued by the trial court, failed to clearly outline

which specific regulations Luther violated or which services at the salon were restrained. 20

The Court reasoned, “Luther could not know without analyzing a multitude of

regulations—state, county, and city emergency orders referenced in the temporary

restraining order, plus the federal guidelines they referenced—what conduct was

prohibited at any given time the temporary restraining order was in effect.” 21

More persuasive is Computek. 22 There, OEM, an office supply company, sued

Computek and its owner, a former OEM employee, alleging theft of OEM’s trade secrets. 23

After the trial court issued a permanent injunction, Computek appealed, asserting the

injunction was improperly broad and lacked specificity since it failed to clearly identify

which OEM clients Computek could not contact. 24 The Dallas Court of Appeals agreed,

18 In re Luther, 620 S.W.3d at 718. 19 Id. 20 Id. at 723. 21 Id. 22 Computek Comput. & Off. Supplies, Inc. v. Walton, 156 S.W.3d 217 (Tex. App.—Dallas 2005, no pet.). 23 Id. at 219–20. 24 Id. at 221–22.

2d. Suppl. CR 314 noting that the injunction needed to specifically name the clients and define the

information that could not be used or disclosed and that the lack of specificity could not be

cured by any knowledge Computek might have outside the permanent injunction. 25

In re Krueger involved an executive barred from “contacting any of Cru Energy,

Inc.’s investors or potential investors, or any other persons doing business with or

potentially a participant in the business of Cru Energy, Inc.” 26 The district court found

Krueger violated that provision by sending emails to vendors of Cru Energy. 27 On review,

the Austin Court of Appeals found the injunction was not sufficiently specific since it failed

to describe in reasonable detail the individuals or organizations that Krueger was

prohibited from contacting. 28 Notably, the injunction failed to name or otherwise identify

those who are considered “investors or potential investors” of Cru Energy, and those who

are “persons doing business with or potentially a participant in the business of” Cru

Energy. 29 The Court rejected Cru’s argument that Krueger was in a position to know who

the investors and persons were doing business with Cru energy because an injunction must

be as “definite, clear and precise as possible . . . without calling on [the enjoined party] for

25 Id. at 222–23 (“Thus, the injunction itself must provide the specific information as to the off- limits clients, without inferences or conclusions, or, in this case, implied references to other records Computek might have.”). 26 No. 03-12-00838-CV, 2013 WL 2157765, at *1 (Tex. App.—Austin May 16, 2013, orig. proceeding). 27 Id. at *2. 28 Id. at *8. 29 Id.

2d. Suppl. CR 315 inferences or conclusions about which persons might well differ and without leaving

anything for further hearing.” 30

The Court finds Computek and Kruger persuasive and analogous to paragraph 13 of

the order issued by the trial court. Here, the injunction specifically names the ES3 Buyers

that are off-limits to Defendants and attaches a list of those entities and individuals. These

provisions are definite, specific and clear and the Court declines Defendants’ suggestion to

modify those provisions.

However, the second prohibition contained in paragraph 13 of the temporary order

is less specific. It includes, in addition to the list of ES3 Buyers, “any subsidiaries, funds

or other entities, formed by the listed entities for the purposes of executing a transaction”

and “entities the individual contacts on the list are currently working for . . . .” 31 As in

Computek, the prohibition on business dealings with “subsidiaries, funds, or other

entities” depends on Defendants’ knowledge of the ownership structure of the companies

with whom they are attempting to enter a deal or it would require Defendants to perform

an inquiry prior to dealing with any new companies and is comparable to the language in

Computek that the Court found problematic. Similarly, the clause in paragraph 13 that

prohibits executing a transaction with entities and individuals on the list that “are

currently working for” the individual or entity would require Defendants to conduct an

30 Id.

31 Temporary Inj. ¶ 13, Dec. 18, 2024.

2d. Suppl. CR 316 inquiry prior to any transaction about the status of any individuals and employees employed

by the entity.

Rule 683 provides that a temporary injunction “shall describe in reasonable detail

and not by reference to the complaint or other document, the act or acts sought to be

restrained.” 32 The purpose of Rule 683’s specificity requirement is to “ensure that parties

are adequately informed of the acts they are enjoined from doing and the reasons for the

injunction.” 33 The Texas Supreme Court has required “strict compliance with Rule 683,

so that a temporary restraining order itself informs a party, unambiguously and with a

reasonable degree of specificity, of the conduct to be restrained.” 34 The requirements of

Rule 683 are mandatory and must be strictly followed. 35

Here, the order falls short of those specificity provisions. Therefore, the Court

modifies the two definitional provisions in paragraph 13, as reflected in the attached

Exhibit A, to more clearly specify the acts Kreines, Ryan and LMP are prohibited from

committing.

ii. Sufficiency of reasoning for issuance of temporary injunction

Defendants also allege the temporary injunction fails to provide sufficient reasons

for its issuance as required by Rule 683. Defendants contend that the temporary injunction

order “must explain the reasons why the court believes the applicant’s probable right will

32 TEX. R. CIV. P. 683. McCaskill v. Nat'l Circuit Assembly, No. 05-17-01289-CV, 2018 WL 3154616, at *2 (Tex. App.— 33

Dallas June 28, 2018, no pet.) (mem. op.). 34 In re Luther, 620 S.W.3d at 723. 35 Id.; Qwest, 24 S.W.3d at 337.

2d. Suppl. CR 317 be endangered if the writ does not issue.” 36 Citing Home Asset, Inc. v MPT of Victory Lakes

Fcer LLC, an unpublished opinion from the Houston Court of Appeals, Defendants argue

that to the extent reasons were set forth in the temporary injunction issued by the Court,

they were conclusory and did not “articulate the factual basis on which it rests, effectively

insisting that the reader accept the writer’s say-so without explanation.” 37

In response, ES3 argues the temporary injunction sufficiently sets forth the reasons

for its issuance. ES3 notes the Court found it is likely to succeed in “proving Kreines

misappropriated ES3’s trade secrets for its own benefit and for the benefit of LMP and will

continue to do so,” that ES3 “will probably succeed on its breach of contract and tortious

interference claims against the Defendants based on factual findings,” that “Kreines and

Ryan violated the Agreements and continue to do so” that the “Plaintiff has shown there

would be a probable imminent and irreparable injury from the actions it seeks to enjoin”

and that it sets forth “the reason why ES3 would suffer probable, imminent and irreparable

injury absent an injunction.” 38

36 Def.s’ Mot. to Dissolve Temporary Inj. 18, Jan. 7, 2025; IPSecure, Inc. v. Carrales, No. 04-16- 00005-CV, 2016 WL 3342108, at *2 (Tex. App.—San Antonio June 15, 2016, no pet.)(mem. op.). Home Asset, Inc. v MPT of Victory Lakes Fcer, LLC, No. 01-22-00441-CV, 2023 WL 3183322, at 37

*2 (Tex. App.—Houston [1st Dist.] May 2, 2023, no pet.) (mem. op.); Def.s’ Mot. to Dissolve Temporary Inj. 18, Jan. 7, 2025. 38 Pl.’s Resp. to Def.s’ Mot. To Dissolve Temporary Inj. 21–22, Feb 14, 2025.

2d. Suppl. CR 318 Rule 683 requires a temporary injunction to include the “reasons for its issuance.” 39

That requirement is mandatory and a temporary injunction that does not meet it is subject

to being declared void and dissolved as it would constitute fundamental error. 40

While Defendants relies on Home Asset and Clark the underlying facts there are

distinguishable. In Home Asset, the Court found that a single sentence in a temporary order

that addressed irreparable injury, stating that “the appellees will be irreparably harmed if

the appellants are allowed to terminate the leases without explaining why doing so will

cause irreparable harm” was a “mere recital” and therefore insufficient under Rule 683

and therefore void. 41

The facts in Clark v. Hastings are also distinguishable. In Clark, the trial court

entered an injunction that it modified just two weeks later by entering a second order. 42

The Houston Appellate Court found the changes made by the second order to be of a

“substantive nature” making it the operative temporary injunction order subject to the

requirements of Rule 683. 43 The Court held the order contained no attempt to satisfy the

requirements of Rule 683 and both parties agreed the second order was insufficient. 44 The

Court also commented that even if both orders were read in tandem, the only language that

39 TEX. R. CIV. P. 683. 40 See Henke, 6 S.W.3d at 721. 41 2023 WL 3183322, at *2–3. 42 Clark v. Hastings Equity Partners, LLC, 651 S.W.3d 359, 363–64 (Tex. App. 2022). 43 Id. at 370. 44 Id. at 370, 371 n.8.

2d. Suppl. CR 319 provided the basis for the ruling was itself insufficient. 45 That portion of the order provided,

“The Respondents have violated certain covenants contained in the said Securities

Purchase Agreement and will, if not restrained, likely engage in conduct that will cause

Petitioners to suffer immediate and irreparable injury, loss or damage; and . . . the

threatened damage to Petitioners is impossible to accurately and fully assess.” 46 The Court

held this brief, conclusory explanation did not satisfy Rule 683.

The trial court’s order here is more detailed and contains significantly more

exposition than those in Clark. In fact, the trial court’s temporary injunction contained

multiple provisions that “set forth the reasons” for the issuance of the injunction. In

addition to the excerpts ES3 cited above, the temporary injunction begins by summarizing

parties briefing leading up to the temporary injunction. 47 It also contains paragraph 16

entitled “Probable, Imminent, And Irreparable Harm” that provides among other things

that: “Plaintiff has shown . . . the loss of exclusive use of its Trade Secrets, a loss of deals

with specific buyers, a decrease in gross profits, and a loss of employees, which is likely to

continue unless Defendants are enjoined.” 48 Paragraph 16 also recites that Ryan and

Kreines were “closely associated with Plaintiff’s goodwill, and by their actions they have

diluted Plaintiff’s goodwill with Plaintiff’s Buyers and will continue to do so.” 49 The

45 Id. at 374. 46 Id. 47 Temporary Inj. Page 1, Dec. 18, 2024. 48 Id. ¶ 16. 49 Id.

2d. Suppl. CR 320 imminent and irreparable injuries are identified as “misappropriation of trade secrets . . .

loss of goodwill and customers” and “breaches of their noncompetition agreements.” 50

And while the seven-page order does not provide an exhaustive exposition of the

factual basis underlying its conclusions and could have contained additional specificity, the

Court finds the order contains a sufficient description to “set forth the basis” of the

injunction.

iii. Bond Sufficiency

Finally, Defendants challenge the bond amount set by the trial court. Following the

hearing conducted in this matter, the trial court’s temporary injunction set ES3’s bond at

$25,000. Defendants contend the bond amount is inadequate and contrary to the evidence.

Defendants rely on Franklin Sav. Association v. Reese, a case from the Austin Court of

Appeals where the trial court found a $10,000 bond an improper and disproportionately

small sum, unable to protect the $25 to $50 Million property at issue. 51 They also rely on

Justice Young’s dissent in Van Huis v. Marine Ventures, Ltd., where he asserted that a

nominal bond in a high value case “could be tantamount to dispensing the bond requirement

altogether.” 52

In response, Plaintiff argues that the Defendants are attempting to relitigate issues

determined in the sound discretion of the court and that the bond amount is sufficient based

on the evidence. ES3 also contends Texas law requires evidence of lost-profits, not lost-

50 Id. 51 756 S.W.2d 14, 16 (Tex. App.—Austin 1988, no writ). 52 672 S.W.3d 22, 26 (Tex. 2023) (Young, J., dissenting).

2d. Suppl. CR 321 gross revenues, 53 and that Defendants have provided only evidence of lost-gross revenues.

Finally, ES3 cites Topheavy Studios, Inc. v. Doe, contending that without evidence of lost

profits, the $25,000 bond amount is sufficient as a matter of law. 54

Rule 684 requires the trial court to set a bond when it grants a temporary

injunction. 55 The text of the rule provides no guidance on the “amount of security” the

Court must require. 56 But courts have held that the purpose of a bond is to protect the

enjoined party from any possible damages occurring as a result of an improperly granted

injunction. 57 The amount of a bond is within the trial court's sound discretion, but a

temporary injunction issued without a bond is void. 58 And the failure to require a bond in

a sufficient amount does not render an injunction void. 59

“The purpose of the motion to dissolve is to provide a means to show that changed

circumstances or changes in the law require the modification or dissolution of the

53 See, e.g., Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 n.1 (Tex. 1992) (“The correct measure of damages is lost net profit, not gross profits.”); Kellmann v. Workstation Integrations, Inc., 332 S.W.3d 679, 684 (Tex. App.—Houston [14th Dist.] 2010, no pet.) (same); MJAH Holdings, LLC v. Henson, No. 03-18-00012-CV, 2019 WL 1413282, at *5 (Tex. App.—Austin Mar. 29, 2019, no pet.) (mem. op.) (same). 54 No. 03-05-00022-CV, 2005 WL 1940159, at *7–8 (Tex. App.—Austin Aug. 11, 2005, no pet.). 55 TEX. R. CIV. P. 684. 56 Id. 57 IAC, 160 S.W.3d at 203; Bayoud v. Bayoud, 797 S.W.2d 304, 312 (Tex. App.—Dallas 1990, writ denied). 58 Whitlow v. Polley, 670 S.W.2d 318, 319 (Tex. App.—Tyler 1984, no writ) (emphasis added); IAC, 160 S.W.3d at 203. 59 El Paso, 729 S.W.2d at 888.

2d. Suppl. CR 322 injunction; the purpose is not to give an unsuccessful party an opportunity to relitigate the

propriety of the original grant.” 60

In this case, this Court did not conduct the underlying temporary injunction hearing,

hear the evidence, issue the temporary injunction, nor set the amount of the bond. The

parties have presented insufficient evidence of changed circumstances since the issuance

of the current bond. And while a motion to dissolve is the proper mechanism to address a

void temporary injunction—one where no bond was set—here the district court temporary

injunction set a bond, which met the threshold requirements of Rule 684. 61 Since the

Defendants have not demonstrated a change of circumstances since the temporary

injunction was granted, the Court does not reconsider nor modify the amount of the original

bond setting.

SUMMARY

The Court, after examining the pleading and documents, the arguments of counsel,

and all other matters properly before the Court, finds:

• That paragraph 13 of the Temporary Injunction entered in the 459th Travis County

on November 26, 2024 does not sufficiently meet the specificity requirement under

Rule 683 and therefore should be partially modified.

• The Temporary Injunction sufficiently set forth the reasons for its issuance as

required by Rule 683.

60 Tober, 668 S.W.2d at 836. 61 See Id.; TEX. R. CIV. P. 684.

2d. Suppl. CR 323 • That the trial court set a bond in the case in accordance with Rule 684 and that no

changed circumstances have been plead that warrant the reexamination of the

sufficiency of the bond amount.

Based on the foregoing, the Court ORDERS a modification of the Temporary

Injunction issued on November 26, 2024 as reflected in the attached Exhibit A, and the

Court issues a new Modified Temporary Injunction reflecting those modifications. The

Court denies all other relief requested.

Hon. Patrick K. Sweeten Judge of the Texas Business Court Third Division

DATED: April 7, 2025

2d. Suppl. CR 324 Exhibit A

2d. Suppl. CR 325 The Business Court of Texas, Third Division

ES3 MINERALS, LLC, § Plaintiff/Counter-Defendant, § v. § NICHOLAS KREINES, DAVID P. § RYAN, LIBERTY MINERAL § Cause No. 24-BC03B-0005 PARTNERS LLC, NAK § RESOURCES INC., AND CGR § OIL AND GAS, LLC, § Defendants/Counter-Plaintiffs. §

═══════════════════════════════════════ MODIFIED TEMPORARY INJUNCTION ═══════════════════════════════════════ On October 29–30th, 2024, the 459th District Court of Travis County heard Plaintiff ES3

Minerals, LLC’s (“Plaintiff” or “ES3”) Application for Temporary Injunction. On November 26,

2024, the district court issued a temporary injunction order. Later, the above-captioned case was

removed to this Court. This Court held a hearing on February 27, 2025, on Defendants’ Motion

to Dissolve Temporary Injunction and Plaintiff’s Opposed Motion to Modify Temporary

Injunction, Subject to Response to Motion to Dissolve and after examining the pleadings and

documents, the arguments of counsel, the evidence presented, and the full record, the Court finds

as follows:

2d. Suppl. CR 326 VALID CAUSES OF ACTION

1. Plaintiff has asserted valid causes of action.

I. PROBABLE RIGHT TO RELIEF

2. Plaintiff has shown a probable right to relief against Defendants Nicholas Kreines

(“Kreines”), David P. Ryan (“Ryan”), and Liberty Mineral Partners LLC (“LMP”).

A. DEFENDANT KREINES

3. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Kreines for (1) violations of trade secret

misappropriation under the Texas Uniform Trade Secrets Act (“TUTSA”), (2) breaches of

fiduciary duty, and (3) breaches of contract (confidentiality, non-solicitation-of-buyers, non-

solicitation-of-employees, and non-competition provisions).

4. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines kept and continues to use and disclose materials and information that are Plaintiff’s trade

secrets to land deals for Defendant LMP, including deals with Plaintiff’s Buyers; that Defendant

Kreines facilitated a deal for Defendant LMP with an existing Plaintiff Buyer while still employed

with Plaintiff; and that Defendant Kreines solicited and will continue to solicit Plaintiff’s Buyers

and employees for Defendant LMP’s benefit.

B. DEFENDANT RYAN

5. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Ryan for breaches of contract (non-solicitation-of-

buyers, non-solicitation-of-employees, and non-competition provisions). Plaintiff has also

sufficiently shown for this temporary injunction that the relevant provisions of Defendant Ryan’s

contract did not change after his brief absence from the company.

6. The Court finds that Plaintiff will probably succeed in showing that Defendant

2d. Suppl. CR 327 Ryan has made and will continue to make deals with Plaintiff’s Buyers.

C. DEFENDANT LMP

7. The Court finds that Plaintiff will probably succeed in showing that Defendant

LMP tortiously interfered with Plaintiff’s agreements with Defendants Kreines and Ryan

(including their noncompetition and non-solicitation provisions) and will continue to do so.

D. TRADE SECRETS MISAPPROPRIATED

8. The Court finds that Plaintiff will probably succeed on its claim that Plaintiff’s

Buyer information, including buyer lists, pricing information, contact information for key-decision

makers, the specific asset preferences of those buyers, and the details of the mineral interest

purchases of those buyers are Plaintiff’s trade secrets (“Trade Secrets”). The Court further finds

that Plaintiff will probably succeed on its claim that Plaintiff has taken reasonable measures under

the circumstances to keep this information secret, and this information derives independent

economic value, actual or potential, from not being generally known to, and not being readily

ascertainable through proper means by, other people who can obtain economic value from the

disclosure or use of the information. The Court further finds that Plaintiff will probably succeed

on its claim that Kreines misappropriated Plaintiff’s Trade Secrets for his own benefit and the

benefit of LMP and will continue to do so.

E. BREACH OF CONTRACT AND INTERFERENCE

9. The Court finds that Plaintiff will probably succeed on its claim that, as a condition

of employment with Plaintiff, Defendants Kreines and Ryan entered into Confidentiality, Non-

Competition and Non-Solicitation Agreements with identical terms (“Kreines Agreement” and

“Ryan Agreement” respectively, and together, “Agreements”).

10. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines has breached the Agreement’s confidentiality provisions by taking, using, and disclosing

2d. Suppl. CR 328 Plaintiff’s Confidential Information for his own benefit and for the benefit of Defendant LMP.

11. In Paragraph 4 of their respective Agreements, Kreines and Ryan agreed to the

following restrictions during employment with ES3 and for twenty-four (24) months thereafter:

Non-Competition; Non-Solicitation of Customers and Prospective Customers. Employee acknowledges that in the course of fulfilling Employee's responsibilities to ES3, Employee will be a representative of the company to, and in some instances may be ES3's primary contact with, existing customers as of the Termination date and prospective customers with whom ES3 has contacted within the 24-month period preceding the Termination date (collectively, "Customers and Prospective Customers"). Employee agrees that the goodwill and relationships developed with ES3's Customers and Prospective Customers is a special, valuable and unique asset of ES3 and should be used for the exclusive benefit of ES3. Accordingly, Employee agrees that, during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless of the reason for or manner of termination, Employee will not, directly or indirectly, except in connection with Employee's employment with ES3: . . .

(c) induce, solicit or take away (or attempt to induce, solicit, or take away) any Customer or Prospective Customer of ES3 and/or encourage any Customer or Prospective Customer to discontinue or limit its relationship with ES3; … or

(e) divert or discourage any Customer or Prospective Customer from entering into a business relationship with and/or obtaining products or services from ES3.

12. The Court finds that Plaintiff will probably succeed on its claim that: (a) Defendants

Kreines and Ryan have breached the Agreements’ Non-Competition and Non-Solicitation

Provisions by using for their own benefit Plaintiff’s’ goodwill and that they have diluted Plaintiff’s

goodwill with Plaintiff’s Buyers; (b) Defendants Kreines and Ryan have induced, solicited and

taken away (and attempted to induce, solicit, or take away) Plaintiff’s Buyers and have encouraged

Plaintiff’s Buyers to discontinue or limit their relationship with ES3; (c) Defendants Kreines and

Ryan have diverted or discouraged Plaintiff’s Buyers from entering into a business relationship

with and/or obtaining products or services from ES3; and (d) Defendant LMP was aware of

Defendant Kreines and Ryan’s contractual obligations to Plaintiff and intentionally interfered.

2d. Suppl. CR 329 13. The Court finds that Plaintiff’s list of Plaintiff’s Buyers attached to this order ∗

(which is marked CONFIDENTIAL) are ES3 customers for whom Kreines was a representative

to and did business with on behalf of ES3 during the 24-month period preceding Kreines’s

termination date of January 31, 2024, and specifically includes the individuals and entities on the

list as well as any subsidiaries of those entities that are known to be subsidiaries by Kreines, Ryan

or LMP, and thus are within the definition of Customers and Prospective Customers under the

Agreements (“Plaintiff’s Buyers”). If an individual on the list begins working at a new entity, the

new entity is not included within the definition of Plaintiff’s Buyers, however the individual on

the list remains within the definition of Plaintiff’s Buyers and prohibitions on Kreines, Ryan and

LMP in this order apply to transactions where they have knowledge the individual is personally

involved.

14. In Paragraph 5 of their respective Agreements, Kreines and Ryan agreed to “that,

during Employee’s employment with ES3 and for twenty-four (24) months thereafter, regardless

of the reason for or manner of termination, Employee will not, on behalf of Employee or any other

person or entity except ES3, directly or indirectly hire, solicit, induce or encourage (or attempt to

hire, solicit, induce or encourage) any employee or officer of ES3 to terminate his/her relationship

with ES3, without the prior written consent of ES3.” The Court finds that Plaintiff will probably

succeed on its claim that Defendants Kreines and Ryan violated their Agreements by soliciting

Plaintiff’s employees, including Curtis Menchaca, inducing them to terminate their employment

with Plaintiff and work for LMP.

∗ The attached Plaintiff’s Buyers list has not been modified.

2d. Suppl. CR 330 15. The Court finds that Plaintiff will probably succeed on its claim that the

Agreements are valid, and the post-employment restrictions recited above were ancillary to or a

part of an otherwise enforceable agreement at the time the Agreements were made; ES3 performed

under the Agreements; and Defendants Kreines and Ryan violated the Agreements and continue

to do so.

II. PROBABLE, IMMINENT, AND IRREPARABLE HARM

16. The Court finds that Plaintiff has shown there would be a probable imminent, and

irreparable injury from the actions it seeks to enjoin. Plaintiff has shown the loss of exclusive use

of its Trade Secrets, a loss of deals with specific buyers, a decrease in gross profits, and a loss of

employees, which is likely to continue unless Defendants are enjoined. Defendants Ryan and

Kreines were closely associated with Plaintiff’s goodwill, and by their actions they have diluted

Plaintiff’s goodwill with Plaintiff’s Buyers and will continue to do so. Plaintiff’s probable,

imminent, and irreparable injuries include:

a) Defendant Kreines’s misappropriation of trade secrets.

b) Plaintiff’s loss of goodwill and customers.

c) Defendants Kreines’s and Ryan’s breaches of their noncompetition agreements.

17. Any suit for money damages would not be an adequate remedy of law to protect

Plaintiff’s rights.

IT IS, THEREFORE, ORDERED that, until the time of final trial on the merits:

1. DEFENDANT KREINES, and any person acting in concert or participation with him

who receives actual notice of this Order, is commanded forthwith through January 31, 2026, to

cease and desist, and otherwise refrain from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined above);

2d. Suppl. CR 331 b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff; and

d) Conspiring to circumvent the restrictions imposed by sections a–c.

2. DEFENDANT RYAN, and any person acting in concert or participation with him who

receives actual notice of this Order, is commanded forthwith through August 23, 2025, to cease

and desist, and otherwise refrain, from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined above);

b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff.

d) Conspiring to circumvent the restrictions imposed by sections a–c.

3. DEFENDANT LMP, and any person acting in concert or participation with LMP who

receives actual notice of this Order, is commanded forthwith to cease and desist, and otherwise

refrain, from tortiously interfering with Kreines and Ryan’s agreements with Plaintiff not to:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined above). This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff;

b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff.

d) Conspiring to circumvent the restrictions imposed by sections a–c.

2d. Suppl. CR 332 IT IS FURTHER ORDERED that trial is set before the Court on October 20, 2025 at

9:00 a.m.

The Clerk of the above-entitled Court shall forthwith issue a Modified Temporary

Injunction in conformity with the law and the terms of this Order.

This Order shall expire at such time as this Court enters judgment in this cause.

The bond filed by Plaintiff in conjunction with the prior injunction on December 18, 2024,

shall be sufficient for the issuance of this Modified Temporary Injunction.

Hon. Patrick K. Sweeten Judge of the Texas Business Court Third Division

DATED: April 7, 2025

2d. Suppl. CR 333 TAB C The Business Court of Texas, Third Division

ES3 MINERALS, LLC, § Plaintiff/Counter-Defendant, § § v. § NICHOLAS KREINES, DAVID P. § RYAN, LIBERTY MINERAL § Cause No. 24-BC03B-0005 PARTNERS LLC, NAK RESOURCES, § INC., AND CGR OIL AND GAS, LLC, § Defendants/Counter-Plaintiffs. § §

═══════════════════════════════════════ MODIFIED TEMPORARY INJUNCTION ═══════════════════════════════════════ On October 29–30th, 2024, the 459th District Court of Travis County heard Plaintiff ES3

Minerals, LLC’s (“Plaintiff” or “ES3”) Application for Temporary Injunction. On November 26,

2024, the district court issued a temporary injunction order. Later, the above-captioned case was

removed to this Court. This Court held a hearing on February 27, 2025, on Defendants’ Motion

to Dissolve Temporary Injunction and Plaintiff’s Opposed Motion to Modify Temporary

Injunction, Subject to Response to Motion to Dissolve and after examining the pleadings and

documents, the arguments of counsel, the evidence presented, and the full record, the Court finds

as follows:

2d. Suppl. CR 334 VALID CAUSES OF ACTION

1. Plaintiff has asserted valid causes of action.

I. PROBABLE RIGHT TO RELIEF

2. Plaintiff has shown a probable right to relief against Defendants Nicholas Kreines

(“Kreines”), David P. Ryan (“Ryan”), and Liberty Mineral Partners LLC (“LMP”).

A. DEFENDANT KREINES

3. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Kreines for (1) violations of trade secret

misappropriation under the Texas Uniform Trade Secrets Act (“TUTSA”), (2) breaches of

fiduciary duty, and (3) breaches of contract (confidentiality, non-solicitation-of-buyers, non-

solicitation-of-employees, and non-competition provisions).

4. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines kept and continues to use and disclose materials and information that are Plaintiff’s trade

secrets to land deals for Defendant LMP, including deals with Plaintiff’s Buyers; that Defendant

Kreines facilitated a deal for Defendant LMP with an existing Plaintiff Buyer while still employed

with Plaintiff; and that Defendant Kreines solicited and will continue to solicit Plaintiff’s Buyers

and employees for Defendant LMP’s benefit.

B. DEFENDANT RYAN

5. The Court finds that Plaintiff has sufficiently shown that it will probably succeed

on the merits of its claims against Defendant Ryan for breaches of contract (non-solicitation-of-

buyers, non-solicitation-of-employees, and non-competition provisions). Plaintiff has also

sufficiently shown for this temporary injunction that the relevant provisions of Defendant Ryan’s

contract did not change after his brief absence from the company.

6. The Court finds that Plaintiff will probably succeed in showing that Defendant

2d. Suppl. CR 335 Ryan has made and will continue to make deals with Plaintiff’s Buyers.

C. DEFENDANT LMP

7. The Court finds that Plaintiff will probably succeed in showing that Defendant

LMP tortiously interfered with Plaintiff’s agreements with Defendants Kreines and Ryan

(including their noncompetition and non-solicitation provisions) and will continue to do so.

D. TRADE SECRETS MISAPPROPRIATED

8. The Court finds that Plaintiff will probably succeed on its claim that Plaintiff’s

Buyer information, including buyer lists, pricing information, contact information for key-decision

makers, the specific asset preferences of those buyers, and the details of the mineral interest

purchases of those buyers are Plaintiff’s trade secrets (“Trade Secrets”). The Court further finds

that Plaintiff will probably succeed on its claim that Plaintiff has taken reasonable measures under

the circumstances to keep this information secret, and this information derives independent

economic value, actual or potential, from not being generally known to, and not being readily

ascertainable through proper means by, other people who can obtain economic value from the

disclosure or use of the information. The Court further finds that Plaintiff will probably succeed

on its claim that Kreines misappropriated Plaintiff’s Trade Secrets for his own benefit and the

benefit of LMP and will continue to do so.

E. BREACH OF CONTRACT AND INTERFERENCE

9. The Court finds that Plaintiff will probably succeed on its claim that, as a condition

of employment with Plaintiff, Defendants Kreines and Ryan entered into Confidentiality, Non-

Competition and Non-Solicitation Agreements with identical terms (“Kreines Agreement” and

“Ryan Agreement” respectively, and together, “Agreements”).

10. The Court finds that Plaintiff will probably succeed on its claim that Defendant

Kreines has breached the Agreement’s confidentiality provisions by taking, using, and disclosing

2d. Suppl. CR 336 Plaintiff’s Confidential Information for his own benefit and for the benefit of Defendant LMP.

11. In Paragraph 4 of their respective Agreements, Kreines and Ryan agreed to the

following restrictions during employment with ES3 and for twenty-four (24) months thereafter:

Non-Competition; Non-Solicitation of Customers and Prospective Customers. Employee acknowledges that in the course of fulfilling Employee's responsibilities to ES3, Employee will be a representative of the company to, and in some instances may be ES3's primary contact with, existing customers as of the Termination date and prospective customers with whom ES3 has contacted within the 24-month period preceding the Termination date (collectively, "Customers and Prospective Customers"). Employee agrees that the goodwill and relationships developed with ES3's Customers and Prospective Customers is a special, valuable and unique asset of ES3 and should be used for the exclusive benefit of ES3. Accordingly, Employee agrees that, during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless of the reason for or manner of termination, Employee will not, directly or indirectly, except in connection with Employee's employment with ES3: . . .

(c) induce, solicit or take away (or attempt to induce, solicit, or take away) any Customer or Prospective Customer of ES3 and/or encourage any Customer or Prospective Customer to discontinue or limit its relationship with ES3; … or

(e) divert or discourage any Customer or Prospective Customer from entering into a business relationship with and/or obtaining products or services from ES3.

12. The Court finds that Plaintiff will probably succeed on its claim that: (a) Defendants

Kreines and Ryan have breached the Agreements’ Non-Competition and Non-Solicitation

Provisions by using for their own benefit Plaintiff’s’ goodwill and that they have diluted Plaintiff’s

goodwill with Plaintiff’s Buyers; (b) Defendants Kreines and Ryan have induced, solicited and

taken away (and attempted to induce, solicit, or take away) Plaintiff’s Buyers and have encouraged

Plaintiff’s Buyers to discontinue or limit their relationship with ES3; (c) Defendants Kreines and

Ryan have diverted or discouraged Plaintiff’s Buyers from entering into a business relationship

with and/or obtaining products or services from ES3; and (d) Defendant LMP was aware of

Defendant Kreines and Ryan’s contractual obligations to Plaintiff and intentionally interfered.

2d. Suppl. CR 337 13. The Court finds that Plaintiff’s list of Plaintiff’s Buyers attached to this order ∗

(which is marked CONFIDENTIAL) are ES3 customers for whom Kreines was a representative

to and did business with on behalf of ES3 during the 24-month period preceding Kreines’s

termination date of January 31, 2024, and specifically includes the individuals and entities on the

list as well as any subsidiaries of those entities that are known to be subsidiaries by Kreines, Ryan

or LMP, and thus are within the definition of Customers and Prospective Customers under the

Agreements (“Plaintiff’s Buyers”). If an individual on the list begins working at a new entity, the

new entity is not included within the definition of Plaintiff’s Buyers, however the individual on

the list remains within the definition of Plaintiff’s Buyers and prohibitions on Kreines, Ryan and

LMP in this order apply to transactions where they have knowledge the individual is personally

involved.

14. In Paragraph 5 of their respective Agreements, Kreines and Ryan agreed to “that,

during Employee’s employment with ES3 and for twenty-four (24) months thereafter, regardless

of the reason for or manner of termination, Employee will not, on behalf of Employee or any other

person or entity except ES3, directly or indirectly hire, solicit, induce or encourage (or attempt to

hire, solicit, induce or encourage) any employee or officer of ES3 to terminate his/her relationship

with ES3, without the prior written consent of ES3.” The Court finds that Plaintiff will probably

succeed on its claim that Defendants Kreines and Ryan violated their Agreements by soliciting

Plaintiff’s employees, including Curtis Menchaca, inducing them to terminate their employment

with Plaintiff and work for LMP.

∗ The attached Plaintiff’s Buyers list has not been modified.

2d. Suppl. CR 338 15. The Court finds that Plaintiff will probably succeed on its claim that the

Agreements are valid, and the post-employment restrictions recited above were ancillary to or a

part of an otherwise enforceable agreement at the time the Agreements were made; ES3 performed

under the Agreements; and Defendants Kreines and Ryan violated the Agreements and continue

to do so.

II. PROBABLE, IMMINENT, AND IRREPARABLE HARM

16. The Court finds that Plaintiff has shown there would be a probable imminent, and

irreparable injury from the actions it seeks to enjoin. Plaintiff has shown the loss of exclusive use

of its Trade Secrets, a loss of deals with specific buyers, a decrease in gross profits, and a loss of

employees, which is likely to continue unless Defendants are enjoined. Defendants Ryan and

Kreines were closely associated with Plaintiff’s goodwill, and by their actions they have diluted

Plaintiff’s goodwill with Plaintiff’s Buyers and will continue to do so. Plaintiff’s probable,

imminent, and irreparable injuries include:

a) Defendant Kreines’s misappropriation of trade secrets.

b) Plaintiff’s loss of goodwill and customers.

c) Defendants Kreines’s and Ryan’s breaches of their noncompetition agreements.

17. Any suit for money damages would not be an adequate remedy of law to protect

Plaintiff’s rights.

IT IS, THEREFORE, ORDERED that, until the time of final trial on the merits:

1. DEFENDANT KREINES, and any person acting in concert or participation with him

who receives actual notice of this Order, is commanded forthwith through January 31, 2026, to

cease and desist, and otherwise refrain from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined

2d. Suppl. CR 339 above);

b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff; and

d) Conspiring to circumvent the restrictions imposed by sections a–c.

2. DEFENDANT RYAN, and any person acting in concert or participation with him who

receives actual notice of this Order, is commanded forthwith through August 23, 2025, to cease

and desist, and otherwise refrain, from directly or indirectly:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined above);

b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff.

d) Conspiring to circumvent the restrictions imposed by sections a–c.

3. DEFENDANT LMP, and any person acting in concert or participation with LMP who

receives actual notice of this Order, is commanded forthwith to cease and desist, and otherwise

refrain, from tortiously interfering with Kreines and Ryan’s agreements with Plaintiff not to:

a) Entering or negotiating any transaction with any of Plaintiff’s Buyers (as defined above). This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff;

b) Encouraging Plaintiff’s Buyers (as defined above) to discontinue or limit their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff; and

c) Soliciting any of Plaintiff’s employees or officers for employment or encouraging them to terminate their relationships with Plaintiff. This expires no later than twenty-four months after Defendants Kreines’s and Ryan’s terminations of employment with Plaintiff.

d) Conspiring to circumvent the restrictions imposed by sections a–c.

2d. Suppl. CR 340 IT IS FURTHER ORDERED that trial is set before the Court on October 20, 2025 at

9:00 a.m.

The Clerk of the above-entitled Court shall forthwith issue a Modified Temporary

Injunction in conformity with the law and the terms of this Order.

This Order shall expire at such time as this Court enters judgment in this cause.

The bond filed by Plaintiff in conjunction with the prior injunction on December 18, 2024,

shall be sufficient for the issuance of this Modified Temporary Injunction.

Hon. Patrick K. Sweeten Judge of the Texas Business Court Third Division

DATED: April 7, 2025

2d. Suppl. CR 341 Exhibit A

2d. Suppl. CR 342 CONFIDENTIAL

PLAINTIFF'S BUYERS

"ES3 Buyers" shall mean any contact and/or decision maker who is/was associated with the following entities:

2d. Suppl. CR 343 CONFIDENTIAL

2d. Suppl. CR 344 CONFIDENTIAL

2d. Suppl. CR 345 CONFIDENTIAL

2d. Suppl. CR 346 TAB D CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION AGREEMENT

This CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION AGREEMENT (this "Agreement") is entered into by and between ES3 MINERALS, LLC, a Texas limited liability company ("ES3"), and DAVID P. RYAN ("Employee").

Recitals

WHEREAS, Employee desires gain employment as an employee of ES3 and ES3 desires to retain Employee as a Landman;

WHEREAS, during the course of employment, Employee will gain access to Confidential Information (as hereinafter defined), relating to the business of ES3, and ES3 has provided and will continue to provide Employee with Confidential Information so Employee may use same for the exclusive benefit of ES3;

WHEREAS, during the course of employment, ES3 has provided and will continue to provide Employee with compensation, expense reimbursements in accordance with company policy, and contact with customers and employees to assist Employee in developing goodwill for ES3, where applicable to Employee's position; and

WHEREAS, ES3 and Employee desire to enter into this Agreement in order to set forth their rights, limitations and obligations with respect to Confidential Information, solicitation of employees and customers, and the other matters set forth herein.

NOW, THEREFORE, in consideration of the employment of Employee, the compensation paid to Employee, and the access to Confidential Information and customers afforded to Employee, as well as the other mutual promises herein, ES3 and Employee agree as follows:

1. Definitions. The terms used in this Agreement shall have the following meanings:

a. "Competing Business" means any business that: (i) actively solicits mineral and/or royalty owners for the purpose of purchasing their oil and gas interests; (ii) partners with "end buyers" to conduct "simultaneous closings" or "back to back" closings, so as to avoid having any substantial capital expenditure in the transaction; or (iii} acquires Oil and Gas Leases for the purposes of selling those leases for a profit, prior to exploiting by means of drilling for Oil and Gas production; or (iv) is so similar in nature to ES3 that it would displace business opportunities or customers of ES3.

b. "Confidential Information" is information acquired by Employee in the course and scope of his/her activities for ES3, both prior to and after execution of this Agreement, that is designated by ES3 as "confidential" or that ES3 indicates through its policies, procedures or practices should not be disclosed to anyone outside the company except through controlled means. Confidential Information includes, without limitation, the identity of and contact information for Current and Prospective Customers (as hereinafter defined), business strategies or plans, sales and/or marketing strategies and techniques, research and development information regarding existing and prospective products and services, financial statements and data, pricing and cost information, billing information, personnel files and employee evaluations, payroll and commission structures and rates, computer programs and software developed by or for ES3, custom enhancements to commercial software, computer access passwords, information and material provided to ES3 by third parties in confidence and/or with disclosure restrictions, and information concerning the services or products offered by ES3 which is not

419 generally known to customers or competitors. The controlled disclosure of Confidential Information to customers, contractors or vendors for legitimate business purposes and the availability of Confidential Information to others outside ES3 through independent means will not remove it from being protected as if Confidential Information under this Agreement acquired by Employee through employment with ES3. "Confidential Materials" means all memoranda, notes, records, reports, manuals, books, papers, letters, customer lists, contracts, software programs, information and records, instructions, guides and manuals, and other information relating to the business of ES3 (whether in written, graphic, recorded, electronic or other tangible form), which contain Confidential Information and which were furnished to Employce by in connection with Employee's association with ES3 or otherwise acquired or developed by Employee ES3.

2. Confidential Information and Trade Secrets. During Employee's emplayment ES3 has access to Confidential provided and will continue to provide Employee with and/or permit Employee Information and trade secrets applicable to Employee's position under ES3's normal policies and that Confidential Information is highly sensitive procedures. Employee understands and acknowledges and that its unauthorized disclosure could place ES3 at a competitive disadvantage. Accordingly, Employee agrees to use Confidential Information for the exclusive benefit of ES3. Employee further agrees that, during Employee's employment with ES3 and at all times thereafter, Employee and all agents, representatives and third parties acting on Employee's behalf shall:

disclose or use any (a) keep strictly confidential and not directly or indirectly communicate, Confidential Information for Employee's own benefit or for the benefit of any other or entity, without the prior person, partnership, proprietorship, association, corporation written consent ofES3; and

(b) not copy, duplicate, record or otherwise reproduce any Confidential Information nor otherwise disclose, disseminate or make the same available to any person who is not an employee of ES3 or to any entity without the prior written consent of ES3.

in the Employee is not prohibited from disclosing information that has already been properly placed domain ES3 domain does not include limited disclosure to a contractor, Customer or public by (public to do so by Prospective Customer), or from disclosing Confidential Information when compelled subpoena or similar operation of law if Employee gives ES3 at least ten (10) days' advance written notice of such disclosure.

3. Handling and Retum of Confidential Materials. All Confidential Materials are the exclusive property of ES3 and shall not be removed from ES3's premises without the prior written consent of ES3. If removed by consent, such Confidential Materials may be used only for the benefit of ES3 in the ordinary course of business. All Confidential Materials in Employee's possession, custody or control shall be returned to ES3 by Employee, immediately and without demand, upon termination of at time if ES3 so demands. Employee's employment with ES3 ("Termination"), and shall be returned any Employee will not make or retain copies, summaries or abstracts of any Confidential Materials.

4. Non-Competition: Non-Solicitation of Customers and Prospective Customers. Employee acknowledges that in the course of fulfilling Employee's responsibilities to ES3, Employee will be a representative of the company to, and in some instances may be ES3's primary contact with, existing customers as of the Termination date and prospective customers with whom ES3 has contacted within the 24 month period preceding the Termination date (collectively, "Customers and Prospective Customers"). Employee agrees that the goodwill and relationships developed with ES3's Customers and Prospective Customers is a special, valuable and unique asset of ES3 and should be used for the exclusive benefit of ES3. Accordingly, Employee agrees that, during Employee's employment with ES3 and for twenty-four

420 will not, directly (24) months thereafter, regardless of the reason for or manner of termination, Employee or indirectly, except in connection with Employee's employment with ES3:

(a) directly compete with ES3;

(b) have any interest as an owner, investor, shareholder, partner, member, lender, director officer, manager, employee, consultant, guarantor, representative, or agent or in any other manner whatsoever, directly or indirectly, carry on or be engaged in (or make preparations for carrying on or being engaged in), financially or otherwise, or advise in the establishment of, Competing Business within the state of Texas; provided, however, to one Employee may make solely passive investments in any Competing Business up percent (1%) of the common stock of which is "publicly held," and of which Employee shall not own or control, directly or indirectly;

(c) induce, solicit r take away (or attempt to induce, solicit, or take away) any Customer or Customer te Prospective Customer of ES3 and/or encourage any Customer or Prospective discontinue or limit its relationship with ES3;

(d) call on, solicit, perform services for or accept work from any Customer or Prospective Customer for the benefit of a Competing Business with which Employee becomes in any way affiliated; or

(e) divert or discourage any Customer or Prospective Customer from entering into a business relationship with and/or obtaining products or services from ES3.

5. Non-Solicitation of Employees. Employee agrees that, during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless of the reason for or manner of termination, Employee will not, on behalf of Employee or any other person or entity except ES3, directly or indirectly hire, solicit, induce or encourage (or attempt to hire, solicit, induce or encourage) any consent employee or officer of ES3 to terminate his /her relationship with ES3, without the prior written of ES3.

6. Reasonableness of Covenants. Employee agrees that the covenants in Paragraphs 2, 3, 4 and 5 of this Agreement are necessary and reasonable, are supported by valid consideration, and are and required to protect the legitimate business interests and goodwill of ES3. Employee acknowledges agrees that enforcement by ES3 of such covenants will not create an undue hardship or unreasonably interfere with Employee's ability to pursue a proper livelihood.

7. No Employment Contract. Employee understands and agrees that Employee's employment with ES3 is on an "at will" basis and may be terminated by Employee or ES3 at any time, with or without cause. Employee further understands and agrees that this Agreement is not, and shall not be construed to create, any contract of employment, express or implied, which is for a specified term or which in any way otherwise alters the "at will" status of Employee's employment.

8. No Other Agreements. Employee represents to ES3 that his/her employment with ES3 will not violate any agreement Employee has made that prohibits Employee from disclosing any information Employee acquired prior to becoming employed by ES3. Employee has not previously, and will not in the future, disclose to ES3 any proprietary or confidential information or trade secrets will belonging to any previous employer or others. Employee is not a party to any other agreement that interfere with Employee's full compliance with this Agreement.

421 9. Survival. The agreements and covenants of Employee in this Agreement and the rights of ES3 there under shall survive termination, for whatever reason, of Employee's employment with ES3 and will remain in full force and effect for their stated duration.

10. Remedies. In the event of breach or threatened breach by Employee of any provision of this Agreement, Employee acknowledges that ES3 will suffer immediate and irreparable harm that cannot be accurately calculated in monetary damages. ES3 shall be entitled to (a) injunctive relief by temporary restraining order, temporary injunction and/or permanent injunction, (b) recovery of all attorney's fees and costs incurred by £S3 in obtaining such relief; and (c) any other legal and equitable relief, including monetary damages incurred as a result of said breach or threatened breach. ES3 may pursue any remedy available, including declaratory relief, concurrently or consecutively in any order, and the pursuit of one such remedy will not be deemed an election of remedies or waiver of the right to any other remedy. ES3 has the right to pursue partial enforcement and/or to seek declaratory relief regarding the enforceable available scope of this Agreement without penalty and without waiving ES3's right to pursue any other remedy subsequent to declaratory relief. The assertion or existence of any claim or cause of action by whether or not on this shall not constitute a defense to Employee against ES3, predicated Agreement, enforcement by ES3 of such agreements and covenants.

\l. Attorneys' Fees and Indemnification. The prevailing party in any legal proceedings brought by or against the other party to enforce any provision of this Agreement shall be entitled to recover against the non-prevailing party the reasonable attomeys' fees, court costs and other expenses incurred by the prevailing party. Employee shall indemnify and hold ES3 harmless from any and all damages and expenses, including court costs and attorneys' fees, that ES3 may sustain as a result of Employee's breach of the terms of this Agreement.

12. Notification. Employee agrees to notify any prospective entity with which Employee becomes in any way associated after separation from employment with ES3 of the existence and provisions of this Agreement. Employee authorizes ES3 to notify anyone employing or evidencing an intention to employ Employee of the existence and provisions of this Agreement. Employee waives and releases ES3 from any claims, causes of action, or liability arising in connection with ES3's contact or communications with such third parties concerning the existence, terms and enforcement of this Agreement.

13. Notices. Any notices, consents, demands, requests, approvals and other communications required or permitted under this Agreement by either party to the other shall be in writing and delivered personally or placed in the United States Mail, certified or registered, return receipt requested, with postage prepaid, to Employee or to ES3 at the addresses set forth below. Notices delivered personally are effective upon actual receipt; mailed notices are effective as of three (3) days after deposit in the United States Mail. Either party may designate a different address by giving the other party written notice of such change in the manner provided herein.

14. Modification. This Agreement may be modified, altered or amended only by written instrument setting forth the amendment and signed by Employee and ES3 or by court order pursuant to Paragraph 19 (Severability) below.

15. Waivers and Consents. The failure of ES3 to require the performance of any term or condition of this Agreement, or the waiver by ES3 of any breach of this Agreement, shall not prevent the subsequent enforcement of any term or condition nor be deemed a waiver of any subsequent breach. if Employee becomes aware of any breach by ES3 of this Agreement, Employee must give ES3 written notice of the alleged breach within seven (7) days thereof and give ES3 thirty (30) days to cure such

422 alleged breach. Employee's failure to provide this notice and opportunity to cure to ES3 will waive Employee's right to assert such alleged breach at a later time.

16. Assignment. This Agreement is binding upon and shall inure to the benefit of Employee and ES3 as well as their respective heirs, successors, legal representatives, executors and administrators. ES3 may assign this Agreement to any of its affiliates or successors, including any person or entity purchasing ail or substantially all of its business and assets or with which ES3 merges or consolidates.

17. Severability. Should any term or provision of this Agreement be determined by a court to be illegal, invalid or unenforceable, such term or provision will be deemed not to be a part hereof; however, the other portions of this Agreement shall remain in full force and effect. It is the parties' intent that the covenants herein be enforced to the fullest extent permitted by applicable law. Accordingly, should a court of competent jurisdiction determine that the scope of any covenant is too broad to be enforced as written, the parties request that the court reform the covenant to the maximum time period, the largest territory, the broadest scope of activity, or other limitation, which such court would find reasonable and enforceable and which effectively protects the business interests of ES3.

18. Governing Law. THIS AGREEMENT SHALL IN ALL RESPECTS BE INTERPRETED, ENFORCED AND GOVERNED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. This Agreement shall be construed as a whole, according to its fair meaning, and not strictly for or against ES3 or Employee.

Knowing and Voluntary Agreement. EMPLOYEE ACKNOWLEDGES THAT HE/SHE 19, HAS BEEN AFFORDED ADEQUATE TIME TO REVIEW AND CONSIDER THE TERMS IN THIS AGREEMENT, AND EMPLOYEE UNDERSTANDS HIS/HER RIGHT TO DISCUSS ANY AND ALL ASPECTS OF THIS AGREEMENT WITH AN ATTORNEY OR OTHER REPRESENTATIVE OF HIS/HER CHOICE, EMPLOYEE ACKNOWLEDGES THAT HE/SHE HAS CAREFULLY READ THIS AGREEMENT, THAT HE/SHE FULLY UNDERSTANDS ITS TERMS, AND THAT EMPLOYER AND ES3 HAVE ENTERED INTO THIS AGREEMENT VOLUNTARILY AND NOT IN RELIANCE ON ANY PROMISES OR REPRESENTATIONS BY ES3 OTHER THAN THOSE CONTAINED HEREIN.

IN WITNESS WHEREOF, ES3 and Employee have executed this Agreement on and with an effective date of October 1,2017.

BS3: EMPLOYEE:

ES3 Minerals, LLC, a Texas limited liability company

By: Ill. President Name. David P. Ryan

Address: 13215 Bee Cave Parkway Address: 202 Duffy Lane Suite B-120 Austin, Texas 78738 Austin, Texas 78738

423 TAB E CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION AGREEMENT

This CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION AGREEMENT (this "Agreement") is entered into by and between ES3 MINERALS, LLC, a Texas limited liability company ("ES3"), and NICK KREINES ("Employee") ,

Recitals

WHEREAS, Employee desires gain employment as an employee of ES3 and ES3 desires to retain Employee as a Landman;

WHEREAS, during the course of employment, Employee will gain access to Confidential Information (as hereinafter defined), relating to the business of ES3, and ES3 has provided and will continue to provide Employee with Confidential Information so Employee may use same for the exclusive benefit of ES3;

WHEREAS, during the course of employment, ES3 has provided and will continue to provide Employee with compensation, expense reimbursements in accordance with company policy, and contact with customers and employees to assist Employee in developing goodwill for ES3, where applicable to Employee's position; and

WHEREAS, ES3 and Employee desire to enter into this Agreement in order to set forth their rights, limitations and obligations with respect to Confidential Information, solicitation of employees and customers, and the other matters set forth herein.

NOW, THEREFORE, in consideration of the employment of Employee, the compensation paid to Employee, and the access to Confidential Information and customers afforded to Employee, as well as the other mutual promises herein, ES3 and Employee agree as follows:

1. Definitions. The terms used.in this Agreement shall have the following meanings:

a. "Competing Business" means any business that: (i) actively solicits mineral and/or royalty owners for the purpose of purchasing their oil and gas interests; (ii) partners with "end buyers" to conduct "simultaneous closings" or "back to back" closings, so as to avoid having any substantial capital expenditure in the transaction; or (iii) acquires Oil and Gas Leases for the purposes of selling those leases for a profit, prior to exploiting by means of drilling for Oil and Gas production; or (iv) is so similar in nature to ES3 that it would displace business opportunities or customers of ES3.

b. "Confidential Information" is information acquired by Employee in the course and scope of his/her activities for ES3, both prior to and after execution of this Agreement, that is designated by ES3 as "confidential" or that ES3 indicates through its policies, procedures or practices should not be disclosed to anyone outside the company except through controlled means. Confidential Information includes, without limitation, the identity of and contact information for Current and Prospective Customers (as hereinafter defined), business strategies or plans, sales and/or marketing strategies and techniques, research and development information regarding existing and prospective products and services, financial statements and data, pricing and cost information, billing information, personnel files and employee evaluations, payroll and commission structures and rates, computer programs and software developed by or for ES3, custom enhancements to commercial software, computer access passwords, information and material provided to ES3 by third parties in confidence and/or with disclosure restrictions, and information concerning the services or products offered by ES3 which is not

425 generally known to customers or competitors. The controlled disclosure of Confidential Information to customers, contractors or vendors for legitimate business. purposes and the availabili of Confidential ty Information to others outside ES3 through independe means will not remove it from nt being protected as Confidential Information under this Agreement if acquired by Employee through employment with ES3. "Confidential Materials" means all memoranda, notes, records, reports, manuals, books, papers, letters, customer lists, contracts, software programs, information and records, instructions, guides and manuals, and other information relating to the business of ES3 (whether in written, graphic, recorded, electronic or other tangible form), which contain Confidential Information and which were furnished to Employee by ES3 or otherwise acquired or developed by Employee in connection with Employee's association with ES3.

2. Confidential Information and Trade Secrets. During Employee 's employment ES3 has provided and will continue to provide Employee with and/or permit Employee access to Confidential Information and trade secrets applicable to Employee's position under ES3's normal policies and procedures. Employee understands and acknowledges that Confidential Information is highly sensitive and that its unauthorized disclosure could place ES3 at a competitive disadvantage. Accordingly, Employee agrees to use Confidential Information for the exclusive benefit of ES3. Employee further agrees that, during Employee's employment with ES3 and at all times thereafter, Employee and all agents, representatives and third parties acting on Employee's behalf shall:

(a) keep strictly confidential and not directly or indirectly communicate, disclose or use any Confidential Information for Employee's own benefit or for the benefit of any other person, partnership, proprietorship, association, corporation or entity, without the prior written consent of ES3; and

(b) not copy, duplicate, record or otherwise reproduce any Confidential Information, nor otherwise disclose, disseminate or make the same available to any person who is not an employee of ES3 or to any entity without the prior written consent of ES3.

Employee is not prohibited from disclosing information that has already been properly placed in the public domain by ES3 (public domain does not include limited disclosure to a contractor, Customer or Prospective Customer), or from disclosing Confidential Information when compelled to do so by subpoena or similar operation of law if Employee gives ES3 at least ten (10) days' advance written notice of such disclosure.

3. Handling and Return of Confidential Materials. All Confidential Materials are the exclusive property of ES3 and shall not be removed from ES3's premises without the prior written consent of ES3. If removed by consent, such Confidential Materials may be used only for the benefit of ES3 in the ordinary course of business. All Confidential Materials in Employee's possession, custody or control shall be returned to ES3 by Employee, immediately and without demand, upon termination of Employee's employment with ES3 ("Termination"), and shall be returned at any time if ES3 so demands. Employee will not make or retain copies, summaries or abstracts of any Confidential Materials.

4. Non-Competition: Non-Solicitation of Customers and Prospective Customers. Employee acknowledges that in the course of fulfilling Employee's responsibilities to ES3, Employee will be a representative of the company to, and in some instances may be ES3's primary contact with, existing customers as of the Termination date and prospective customers with whom ES3 has contacted within the 24 month period preceding the Termination date (collectiv ely, "Customers and Prospective Customers"). Employee agrees that the goodwill and relationships developed with ES3's Customers and Prospective Customers is a special, valuable and unique asset of ES3 and should be used for the exclusive benefit of ES3. Accordingly, Employee agrees that, during Employee's employment with ES3 and for twenty-four

426 (24)months. thereafter, regardless of the reason for or manner of termination, Employee will not, directly or indirectly, except in connection with Employee 's employment with ES3:

(a) directly compete with ES3;

{b) have any interest as an owner, investor, shareholder, partner, member, lender, director, officer, manager, employee, consultant, guarantor, representative, or agent or in any other manner whatsoever, directly_or indirectly carry on or be engaged in {or make preparations for carrying on or being engaged in), financially or otherwise, or advise in the establishment of, a Competing Business@ithin the state of Texas> provided, however, Employee may make solely passive investments in any Competing Business up to one percent (1%) of the common stock of which is "publicly held," and of which Employee shall not own or control, directly or indirectly;

{c) induce, solicit or take away (or attempt to induce, solicit, or take away) any Customer or Prospective Customer of ES3 and/or encourage any Customer or Prospective Customer to discontinue or limit its relationship with ES3;

(d) call on, solicit, perform services for or accept work from any Customer or Prospective Customer for the benefit of Competing Business with which a Employee becomes in any way affiliated; or

(e) divert or discourage any Customer or Prospective Customer from entering into a business relationship with and/or obtaining products or services from ES3.

5. Non-Solicitation of Employees. Employee agrees that, during Employee's employment with ES3 and for twenty-four (24) months thereafter, regardless of the reason for or manner of termination, Employee will not, on behalf of Employee or any other person or entity except ES3, directly or indirectly hire, solicit, induce or encourage (or attempt to hire, solicit, induce or encourage) any employee or officer of ES3 to terminate his/her relationship with ES3, without the prior written consent of ES3.

.6 Reasonableness of Covenants. Employee agrees that the covenants in Paragraphs 2, 3, 4 and 5 of this Agreement are necessary and reasonable, are supported by valid consideration, and are required to protect the legitimate business interests and goodwill of ES3. Employee acknowledges and agrees that enforcement by ES3 of such covenants will not create an undue hardship or unreasonably interfere with Employee's ability to pursue a proper livelihood.

7. No Employment Contract. Employee understands and agrees that Employee's employment with ES3 is on an "at will" basis and may be terminated by Employee or ES3 at any time, with or without cause, Employee further understands and agrees that this Agreement is not, and shall not be construed to create, any contract of employment, express or implied, which is for a specified term or which in any way otherwise alters the "at will" status of Employee 's employment.

8. No Other Agreements. Employee represents to ES3 that his/her employm ent with ES3 will not violate any agreement Employee has made that prohibits Employee from disclosing any information Employee acquired prior to becoming employed by ES3. Employee has not previously, and will not in the future, disclose to ES3 any proprietary or confidential information or trade secrets belonging to any previous employer or others. Employee is not a party to any other agreement that will interfere with Employee's full compliance with this Agreement.

427 9, Survival. The agreements and covenants of Employee in this Agreement and the rights of ES3 there under shall survive termination, for whatever reason, of Employee's employment with ES3 and will remain in full force and effect for their stated duration.

10. Remedies. in the event of breach or threatened breach by Employee of any provision of this Agreement, Employee acknowledges that ES3 will suffer immediate and irreparable harm that cannot be accurately calculated in monetary damages. ES3 shall be entitled to (a) injunctive relief by temporary restraining order, temporary injunction and/or permanent injunction; (b) recovery of all attorney's fees and costs incurred by ES3 in obtaining such relief; and (c) any other legal and equitable relief, including monetary damages incurred as a result of said breach or threatened breach. ES3 may pursue any remedy available, inclading declaratory relief, concurrently or consecutively in any order, and the pursuit of one such remedy will not be deemed an election of remedies or waiver of the right to any other remedy. ES3 has the right to pursue partial enforcement and/or to seek declaratory relief regarding the enforceable scope of this Agreement without penalty and without waiving ES3's right to pursue any other available remedy subsequent to declaratory relief. The assertion or existence of any claim or cause of action by Employee against ES3, whether or not predicated on this Agreement, shall not constitute a defense to enforcement by ES3 of such agreements and covenants,

11, Attorneys' Fees and Indemnification. The prevailing party in any legal proceedings brought by or against the other party to enforce any provision of this Agreement shall be entitled to recover against the non-prevailing party the reasonable attorneys' fees, court costs and other expenses incurred by the prevailing party. Employee shall indemnify and hold ES3 harmless from any and all damages and expenses, including court costs and attorneys' fees, that ES3 may sustain as a result of Employee's breach of the terms of this Agreement.

12. Notification. Employee agrees to notify any prospectiv entity with which e Employee becomes in any way associated after separation from employme nt with ES3 of the existence and provisions of this Agreement. Employee authorizes ES3 to notify anyone employing or evidencing an intention to employ Employee of the existence and provisions of this Agreement. Employee waives and releases ES3 from any claims, causes of action, or liability arising in connection with ES3's contact or communications with such third parties concerning the existence, terms and enforcement of this Agreement.

13, Notices. Any notices, consents, demands, requests, approvals and other communications required or permitted under this Agreement by either party to the other shall be in writing and delivered personally or placed in the United States Mail, certified or registered, return receipt requested, with postage prepaid, to Employee or to ES3 at the addresses set forth below. Notices delivered personally are effective upon actual receipt; mailed notices are effective as of three (3) days after deposit in the United States Mail. Either party may designate a different address by giving the other party written notice of such change in the manner provided herein.

14. Modification. This Agreement may be modified, altered or amended only by written instrument setting forth the amendment and signed by Employee and ES3 or by court order pursuant to Paragraph 19 (Severability) below.

15. Waivers and Consents. The failure of ES3 to require the performan of ce any term or condition of this Agreement, or the waiver by ES3 of any breach of this Agreement, shall not prevent the subsequent enforcement of any term or condition nor be deemed a waiver of any subsequent breach. If Employee becomes aware of any breach by ES3 of this Agreement, Employee must give ES3 written notice of the alleged breach within seven (7) days thereof and give ES3 thirty (30) days to cure such

428 alleged breach. Employee's failure to provide this notice and opportunity to cure to ES3 will waive Employee's right to assert such alleged breach at a later time.

16. Assignment. This Agreement is binding upon and shall inure to the benefit of Employee and ES3 as well as their respective heirs, successors, legal representatives, executors and administrators. ES3 may assign this Agreement to any of its affiliates or successors, including any person or entity purchasing all or substantially all of its business and assets or with which ES3 merges or consolidates,

17 Severability Should any term or provision of this Agreement be determined by a court to be illegal, invalid or unenforceable such term or provision will be deemed not to be a part hereof: however, the other portions of this Agreement shall remain in full force and effect It is the parties' intent that the covenants herein be enforced to the fullest extent permitted by applicable law Accordingly, should a court of competent jurisdiction determine that the scope of any covenant is too broad to be forced as written, the parties request that the court reform the covenant to the maximum time peri od, the largest territory, the broadest scope of activity, or other limitation, which such court would find reasonable and enforceable and which effectively protects the business interests of ES3.

18. Governing Law. THIS AGREEMENT SHALL IN ALL RESPECTS BE INTERPRETED, ENFORCED AND GOVERNED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. This Agreement shall be construed as a whole, according to its fair meaning, and not strictly for or against ES3 or Employee.

19, Knowing and Voluntary Agreement. EMPLOYEE ACKNOWLEDGES THAT HE/SHE HAS BEEN AFFORDED ADEQUATE TIME TO REVIEW AND CONSIDER THE TERMS IN THIS AGREEMENT, AND EMPLOYEE UNDERSTANDS HIS/HER RIGHT TO DISCUSS ANY AND ALL ASPECTS OF THIS AGREEMENT WITH AN ATTORNEY OR OTHER REPRESENTATIVE OF HIS/HER CHOICE. EMPLOYEE ACKNOWLEDGES THAT HE/SHE HAS CAREFULLY READ THIS AGREEMENT, THAT HE/SHE FULLY UNDERSTANDS ITS TERMS, AND THAT EMPLOYEE AND ES3 HAVE ENTERED INTO THIS AGREEMENT VOLUNTARILY AND NOT IN RELIANCE ON ANY PROMISES OR REPRESENTATIONS BY ES3 OTHER THAN THOSE CONTAINED HEREIN.

IN WITNESS WHEREOF, ES3 and Employee have executed this Agreement on and with an effective date of August 12,2019.

ES3: EMPLOYEE: ES3 Minerals, LLC, a Texas limited liability company

ardJ Stanton ITI, President Name: Nick Kreines

Address: 13215 Bee Cave Parkway Address: 3501 FM 620 S. Suite B-120 Apt. 14105 Austin, Texas 78738 Austin, Texas 78738

429 TAB F Tex. Bus. & Com. Code § 15.50 *** This document is current through the 2023 Regular Session; the 1st C.S.; the 2nd C.S.; the 3rd C.S. and the 4th C.S. of the 88th Legislature; and the November 7, 2023 general election results. ***

Texas Statutes & Codes Annotated by LexisNexis® > Business and Commerce Code > Title 2 Competition and Trade Practices (Chs. 15 — 22) > Chapter 15 Monopolies, Trusts and Conspiracies in Restraint of Trade (Subchs. A — E) > Subchapter E Covenants Not to Compete (§§ 15.50 — 15.52)

Sec. 15.50. Criteria for Enforceability of Covenants Not to Compete.

(a) Notwithstanding Section 15.05 of this code, and subject to any applicable provision of Subsection (b), a covenant not to compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement at the time the agreement is made to the extent that it contains limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and do not impose a greater restraint than is necessary to protect the goodwill or other business interest of the promisee. (b) A covenant not to compete relating to the practice of medicine is enforceable against a person licensed as a physician by the Texas Medical Board if such covenant complies with the following requirements: (1) the covenant must: (A) not deny the physician access to a list of his patients whom he had seen or treated within one year of termination of the contract or employment; (B) provide access to medical records of the physician’s patients upon authorization of the patient and any copies of medical records for a reasonable fee as established by the Texas Medical Board under Section 159.008, Occupations Code; and (C) provide that any access to a list of patients or to patients’ medical records after termination of the contract or employment shall not require such list or records to be provided in a format different than that by which such records are maintained except by mutual consent of the parties to the contract; (2) the covenant must provide for a buy out of the covenant by the physician at a reasonable price or, at the option of either party, as determined by a mutually agreed upon arbitrator or, in the case of an inability to agree, an arbitrator of the court whose decision shall be binding on the parties; and (3) the covenant must provide that the physician will not be prohibited from providing continuing care and treatment to a specific patient or patients during the course of an acute illness even after the contract or employment has been terminated. Page 2 of 2 Tex. Bus. & Com. Code § 15.50

(c) Subsection (b) does not apply to a physician’s business ownership interest in a licensed hospital or licensed ambulatory surgical center.

History

Enacted by Acts 1989, 71st Leg., ch. 1193 (S.B. 946), § 1, effective August 28, 1989; am. Acts 1993, 73rd Leg., ch. 965 (H.B. 7), § 1, effective September 1, 1993; am. Acts 1999, 76th Leg., ch. 1574 (H.B. 3285), § 1, effective September 1, 1999; am. Acts 2001, 77th Leg., ch. 1420 (H.B. 2812), § 14.729, effective September 1, 2001; am. Acts 2009, 81st Leg., ch. 971 (H.B. 3623), § 1, effective September 1, 2009.

Texas Statutes & Codes Annotated by LexisNexis® Copyright © 2025 All rights reserved.

End of Document TAB G Tex. Gov’t Code § 25A.004 *** This document is current through the 2023 Regular Session; the 1st C.S.; the 2nd C.S.; the 3rd C.S. and the 4th C.S. of the 88th Legislature; and the November 7, 2023 general election results. ***

Texas Statutes & Codes Annotated by LexisNexis® > Government Code > Title 2 Judicial Branch (Subts. A — M) > Subtitle A Courts (Chs. 21 — 30) > Chapter 25A Business Court (§§ 25A.001 — 25A.020)

Sec. 25A.004. Jurisdiction and Powers.

(a) Subject to Subsections (b), (c), (d), (e), and (f), the business court has the powers provided to district courts by Chapter 24, including the power to: (1) issue writs of injunction, mandamus, sequestration, attachment, garnishment, and supersedeas; and (2) grant any relief that may be granted by a district court. (b) Subject to Subsection (c), the business court has civil jurisdiction concurrent with district courts in the following actions in which the amount in controversy exceeds $5 million, excluding interest, statutory damages, exemplary damages, penalties, attorney’s fees, and court costs: (1) a derivative proceeding; (2) an action regarding the governance, governing documents, or internal affairs of an organization; (3) an action in which a claim under a state or federal securities or trade regulation law is asserted against: (A) an organization; (B) a controlling person or managerial official of an organization for an act or omission by the organization or by the person in the person’s capacity as a controlling person or managerial official; (C) an underwriter of securities issued by the organization; or (D) the auditor of an organization; (4) an action by an organization, or an owner of an organization, if the action: (A) is brought against an owner, controlling person, or managerial official of the organization; and (B) alleges an act or omission by the person in the person’s capacity as an owner, controlling person, or managerial official of the organization; Page 2 of 3 Tex. Gov’t Code § 25A.004

(5) an action alleging that an owner, controlling person, or managerial official breached a duty owed to an organization or an owner of an organization by reason of the person’s status as an owner, controlling person, or managerial official, including the breach of a duty of loyalty or good faith; (6) an action seeking to hold an owner or governing person of an organization liable for an obligation of the organization, other than on account of a written contract signed by the person to be held liable in a capacity other than as an owner or governing person; and (7) an action arising out of the Business Organizations Code. (c) The business court has civil jurisdiction concurrent with district courts in an action described by Subsection (b) regardless of the amount in controversy if a party to the action is a publicly traded company. (d) The business court has civil jurisdiction concurrent with district courts in the following actions in which the amount in controversy exceeds $10 million, excluding interest, statutory damages, exemplary damages, penalties, attorney’s fees, and court costs: (1) an action arising out of a qualified transaction; (2) an action that arises out of a contract or commercial transaction in which the parties to the contract or transaction agreed in the contract or a subsequent agreement that the business court has jurisdiction of the action, except an action that arises out of an insurance contract; and (3) subject to Subsection (g), an action that arises out of a violation of the Finance Code or Business & Commerce Code by an organization or an officer or governing person acting on behalf of an organization other than a bank, credit union, or savings and loan association. (e) The business court has civil jurisdiction concurrent with district courts in an action seeking injunctive relief or a declaratory judgment under Chapter 37, Civil Practice and Remedies Code, involving a dispute based on a claim within the court’s jurisdiction under Subsection (b), (c), or (d). (f) Except as provided by Subsection (h), the business court has supplemental jurisdiction over any other claim related to a case or controversy within the court’s jurisdiction that forms part of the same case or controversy. A claim within the business court’s supplemental jurisdiction may proceed in the business court only on the agreement of all parties to the claim and a judge of the division of the court before which the action is pending. If the parties involved in a claim within the business court’s supplemental jurisdiction do not agree on the claim proceeding in the business court, the claim may proceed in a court of original jurisdiction concurrently with any related claims proceeding in the business court. (g) Unless the claim falls within the business court’s supplemental jurisdiction, the business court does not have jurisdiction of: (1) a civil action: (A) brought by or against a governmental entity; or Page 3 of 3 Tex. Gov’t Code § 25A.004

(B) to foreclose on a lien on real or personal property; (2) a claim arising out of: (A) Subchapter E, Chapter 15, and Chapter 17, Business & Commerce Code; (B) the Estates Code; (C) the Family Code; (D) the Insurance Code; or (E) Chapter 53 and Title 9, Property Code; (3) a claim arising out of the production or sale of a farm product, as that term is defined by Section 9.102, Business & Commerce Code; (4) a claim related to a consumer transaction, as that term is defined by Section 601.001, Business & Commerce Code, to which a consumer in this state is a party, arising out of a violation of federal or state law; or (5) a claim related to the duties and obligations under an insurance policy. (h) The business court does not have jurisdiction of the following claims regardless of whether the claim is otherwise within the court’s supplemental jurisdiction under Subsection (f): (1) a claim arising under Chapter 74, Civil Practice and Remedies Code; (2) a claim in which a party seeks recovery of monetary damages for bodily injury or death; or (3) a claim of legal malpractice.

History

Acts 2023, 88th Leg., ch. 380 (H.B. 19), § 1, effective September 1, 2023.

Texas Statutes & Codes Annotated by LexisNexis® Copyright © 2025 All rights reserved.

End of Document TAB H Tex. Gov’t Code § 25A.006 *** This document is current through the 2023 Regular Session; the 1st C.S.; the 2nd C.S.; the 3rd C.S. and the 4th C.S. of the 88th Legislature; and the November 7, 2023 general election results. ***

Texas Statutes & Codes Annotated by LexisNexis® > Government Code > Title 2 Judicial Branch (Subts. A — M) > Subtitle A Courts (Chs. 21 — 30) > Chapter 25A Business Court (§§ 25A.001 — 25A.020)

Sec. 25A.006. Initial Filing; Removal and Remand.

(a) An action within the jurisdiction of the business court may be filed in the business court. The party filing the action must plead facts to establish venue in a county in a division of the business court, and the business court shall assign the action to that division. Venue may be established as provided by law or, if a written contract specifies a county as venue for the action, as provided by the contract. (b) If the business court does not have jurisdiction of the action, the court shall, at the option of the party filing the action: (1) transfer the action to a district court or county court at law in a county of proper venue; or (2) dismiss the action without prejudice to the party’s rights. (c) If, after an action is assigned to a division of the business court, the court determines that the division’s geographic territory does not include a county of proper venue for the action, the court shall: (1) if an operating division of the court includes a county of proper venue, transfer the action to that division; or (2) if there is not an operating division of the court that includes a county of proper venue, at the option of the party filing the action, transfer the action to a district court or county court at law in a county of proper venue. (d) A party to an action filed in a district court or county court at law that is within the jurisdiction of the business court may remove the action to the business court. If the business court does not have jurisdiction of the action, the business court shall remand the action to the court in which the action was originally filed. (e) A party to an action filed in a district court or county court at law in a county of proper venue that is not within an operating division of the business court or the judge of the court in which the action is filed may not remove or transfer the action to the business court. Page 2 of 3 Tex. Gov’t Code § 25A.006

(f) A party may file an agreed notice of removal at any time during the pendency of the action. If all parties to the action have not agreed to remove the action, the notice of removal must be filed: (1) not later than the 30th day after the date the party requesting removal of the action discovered, or reasonably should have discovered, facts establishing the business court’s jurisdiction over the action; or (2) if an application for temporary injunction is pending on the date the party requesting removal of the action discovered, or reasonably should have discovered, facts establishing the business court’s jurisdiction over the action, not later than the 30th day after the date the application is granted, denied, or denied as a matter of law. (g) The notice of removal must be filed with the business court and the court in which the action was originally filed. On receipt of the notice, the clerk of the court in which the action was originally filed shall immediately transfer the action to the business court in accordance with rules adopted by the supreme court, and the business court clerk shall assign the action to the appropriate division of the business court. (h) The filing of an action or a notice of removal in the business court is subject to Section 10.001, Civil Practice and Remedies Code. (i) Removal of a case to the business court is not subject to the statutes or rules governing the due order of pleading. (j) Removal of a case does not waive a defect in venue or constitute an appearance to determine personal jurisdiction. (k) The judge of a court in which an action is filed may request the presiding judge for the court’s administrative region to transfer the action to the business court if the action is within the business court’s jurisdiction. The judge shall notify all parties of the transfer request and request a hearing on the transfer request. After a hearing on the request, the presiding judge may transfer the action to the business court if the presiding judge finds the transfer will facilitate the fair and efficient administration of justice. The business court clerk shall assign an action transferred under this subsection to the appropriate division of the business court. (l) The business court judge on establishment of jurisdiction and venue over an action shall by order declare the county in which any jury trial for the action will be held as determined under Section 25A.015.

History

Acts 2023, 88th Leg., ch. 380 (H.B. 19), § 1, effective September 1, 2023.

Texas Statutes & Codes Annotated by LexisNexis® Copyright © 2025 All rights reserved. Page 3 of 3 Tex. Gov’t Code § 25A.006

End of Document TAB I Tex. R. Civ. P. 355 The State and Federal rules are current through March 25, 2025. Local District rules are updated periodically throughout the year.

TX - Texas Local, State & Federal Court Rules > TEXAS RULES OF CIVIL PROCEDURE > PART III. RULES OF PRACTICE IN THE BUSINESS COURT

Rule 355. Action Removed to the Business Court.

(a) Notice of Removal Required. A party to an action originally filed in a district court or county court at law may remove the action to the business court by filing a notice of removal with: (1) the court from which removal is sought; and (2) the business court. (b) Notice Contents. The notice must: (1) state whether all parties agree to the removal; (2) plead facts to establish: (A) the business court’s authority to hear the action; and (B) venue in a county in an operating division of the business court; and (3) contain a copy of the district court’s or county court at law’s docket sheet and all process, pleadings, and orders in the action. (c) Notice Deadline. (1) When Agreed. A party may file a notice of removal reflecting the agreement of all parties at any time during the pendency of the action. (2) When Not Agreed. If all parties have not agreed to remove the action, the notice of removal must be filed: (A) within 30 days after the date the party requesting removal of the action discovered, or reasonably should have discovered, facts establishing the business court’s authority to hear the action; or (B) if an application for temporary injunction is pending on the date the party requesting removal of the action discovered, or reasonably should have discovered, facts establishing the business court’s authority to hear the action, within 30 days after the date the application is granted, denied, or denied by operation of law. (d) Effect of Notice. A notice of removal to the business court is not subject to due order of pleading rules. Filing a notice of removal does not waive a defect in venue or constitute an appearance waiving a challenge to personal jurisdiction. Page 2 of 2 Tex. R. Civ. P. 355

(e) Clerk Duties. On receipt of a notice of removal, the clerk of the court from which removal is sought must immediately transfer the action to the business court. The business court clerk must assign the action to the appropriate operating division of the business court. If the division has more than one judge, then the clerk must randomly assign the action to a specific judge within that division. (f) Remand. (1) When Required. If the business court determines, on motion or its own initiative, that removal was improper, the business court must remand the action to the court from which the action was removed. (2) Motion to Remand. (A) A party may file a motion to remand the action in the business court based on improper removal. Except as provided in (B), the motion must be filed within 30 days after the notice of removal is filed. (B) If a party is served with process after the notice of removal is filed, the party seeking remand must file a motion to remand within 30 days after the party enters an appearance. (3) On Business Court’s Own Initiative. The business court must provide the parties 10 days’ notice of its intent to remand on its own initiative and an opportunity to be heard on any objection.

History

Added by Texas Supreme Court, Misc. Docket No. 24-9037, effective September 1, 2024.

Texas Local, State & Federal Court Rules Copyright © 2025 All rights reserved.

End of Document TAB J Tex. R. Civ. P. 683 The State and Federal rules are current through March 25, 2025. Local District rules are updated periodically throughout the year.

TX - Texas Local, State & Federal Court Rules > TEXAS RULES OF CIVIL PROCEDURE > PART VI. RULES RELATING TO ANCILLARY PROCEEDINGS > SECTION 5. Injunctions

Rule 683. Form and Scope of Injunction or Restraining Order.

Every order granting an injunction and every restraining order shall set forth the reasons for its issuance; shall be specific in terms; shall describe in reasonable detail and not by reference to the complaint or other document, the act or acts sought to be restrained; and is binding only upon the parties to the action, their officers, agents, servants, employees, and attorneys, and upon those persons in active concert or participation with them who receive actual notice of the order by personal service or otherwise. Every order granting a temporary injunction shall include an order setting the cause for trial on the merits with respect to the ultimate relief sought. The appeal of a temporary injunction shall constitute no cause for delay of the trial.

Texas Local, State & Federal Court Rules Copyright © 2025 All rights reserved.

End of Document TAB K Tex. R. Civ. P. 684 The State and Federal rules are current through March 25, 2025. Local District rules are updated periodically throughout the year.

TX - Texas Local, State & Federal Court Rules > TEXAS RULES OF CIVIL PROCEDURE > PART VI. RULES RELATING TO ANCILLARY PROCEEDINGS > SECTION 5. Injunctions

Rule 684. Applicant’s Bond.

In the order granting any temporary restraining order or temporary injunction, the court shall fix the amount of security to be given by the applicant. Before the issuance of the temporary restraining order or temporary injunction the applicant shall execute and file with the clerk a bond to the adverse party, with two or more good and sufficient sureties, to be approved by the clerk, in the sum fixed by the judge, conditioned that the applicant will abide the decision which may be made in the cause, and that he will pay all sums of money and costs that may be adjudged against him if the restraining order or temporary injunction shall be dissolved in whole or in part. Where the temporary restraining order or temporary injunction is against the State, a municipality, a State agency, or a subdivision of the State in its governmental capacity, and is such that the State, municipality, State agency, or subdivision of the State in its governmental capacity, has no pecuniary interest in the suit and no monetary damages can be shown, the bond shall be allowed in the sum fixed by the judge, and the liability of the applicant shall be for its face amount if the restraining order or temporary injunction shall be dissolved in whole or in part. The discretion of the trial court in fixing the amount of the bond shall be subject to review. Provided that under equitable circumstances and for good cause shown by affidavit or otherwise the court rendering judgment on the bond may allow recovery for less than its full face amount, the action of the court to be subject to review.

Texas Local, State & Federal Court Rules Copyright © 2025 All rights reserved.

End of Document Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Melissa Ethridge on behalf of James Parker Bar No. 24027591 methridge@lglawfirm.com Envelope ID: 105120293 Filing Code Description: Brief Requesting Oral Argument Filing Description: Amended Brief for Appellants Status as of 9/3/2025 7:06 AM CST

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