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Contracts Keyed to Frier
Krafsur v. UOP (In re El Paso Refinery, L.P.)
Citation:
196 B.R. 58 (Bankr. W.D. Tex. 1996)Facts
El Paso Refinery, L.P. owned and operated a petroleum refinery under a licensing contract to use refining technology that was developed by Defendant. The contract required El Paso to pay Defendant $1.97 million in royalties. El Paso filed for bankruptcy, and the refinery was conveyed to Refinery Holding Company (RHC). Defendant and RHC entered into a new licensing contract for the technology used at the refinery. That contract required RHC to pay UOP $3.7 million in royalties. Defendant filed a claim against El Paso in the bankruptcy action for $4 million in unpaid royalties from El Paso. Plaintiff brought an action objecting to Defendant’s claim, arguing that Defendant’s claim should be mitigated by the royalty payments from RHC. Defendant argued that it was a lost-volume seller.
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