Texas Business Court Decision – April 10, 2026
No. 26-BC11A-0004 Energy Founders Fund, LP v. Phillip Daskevich, et al. (Eleventh Division, Judge Stagner)
Contracts. Gage Western (Gage) is a Texas LLC whose governance is controlled by a three-member Board of Directors: a Class A Director (Donavan, appointed by majority investor Energy Founders [Energy]), a Class B Director (Defendant Phillip Daskevich), and a Management Director (Tauber). Each director holds one vote, and “Board Approval” is defined in the Company Agreement as a simple majority.
In August 2024, Energy announced it was selling its membership units to a newly formed entity, GW Allen, LLC, and characterized the transaction as a “Controlling Sale” – which would trigger drag-along rights and force the minority members, the Daskeviches, to sell their units on the same terms, effectively transferring 100% of Gage to GW Allen. The Board voted 2-1 to approve the transfer, with Daskevich dissenting. The deal closed and this litigation followed.
The matter comes before the court on competing motions for partial summary judgment, and the dispute hinges on a single question of contract interpretation: did the transfer require only a majority Board vote under Section 9.2 of the Company Agreement or did it also require separate approval by both the Class A (Energy) and Class B (Daskevich) Directors (“Special Director Approval”) under Section 7.2(c)(ii) of the Agreement?
Held: (1) Section 9.2 governs and simple majority Board approval is sufficient; Section 9.2 is self-contained and unambiguous and identified the subject (transfers), the decision makers (the Board), and the voting standard (majority). The article does not cross-reference Section 7.2(c)(ii) and does not carve out special veto rights for particular directors.
(2) Section 7.2(c)(ii) did not add a second layer of approval – it governs Gage’s actions, while 9.2 governs member transfers; here Gage was neither buyer nor seller – Energy was. Applying 7.2 to every member transfer would render 9.2’s majority-vote rule meaningless, since Special Director Approval would be required in every case. The court must give effect to each provision.
(3) The “notwithstanding” clause in Section 7.2(c)(ii) does not override 9.2; the provision only resolves conflicts, and there is no conflict here as the two sections regulate different actors and different conduct.
(4) Section 7.4(d) which prevents the Board from bypassing Section 7.2 only applies when Section 7.2 otherwise applies; since it doesn’t apply to member transfers, Section 7.4 has no operative effect here.
(5) The court will not rewrite the parties’ agreement on equity grounds; Section 9.2 of the Agreement creates a right of first offer as a minority protection; here, the Daskevichs did not exercise their right to buy match Energy’s $4.5 million sale price and avoid exercise of the drag-along provision; the Section provides minority owners protection from being forced out based on an unfair valuation, but it does not give them a veto over transfers.
Energy’s and Donavan’s motions for partial summary judgment are granted, and the Daskeviches’ cross-motions are denied; the September 3, 2024 Board vote was valid and effective under the Company Agreement.
The court reserves the question of whether the transaction qualified as a “controlling sale” to a non-“affiliate” under Section 9.2(c)- that issue determines whether the drag-along provisions were properly invoked.