Fracking well head connected to fracking pumps. Photo: Shutterstock.com

The overall lesson that Houston litigator Trey Peacock took away from winning a $40 million verdict is that there are cases that should not be settled.

"Stand your ground, when you know you are right," said Peacock, a partner at Susman Godfrey.

In an underlying patent licensing dispute between companies that manufacture tools for plugging oil and gas fracking wells, Peacock represented Repeat Precision. His client scored a total defense win by defeating plaintiff Diamondback Industries Inc.'s claims, and winning counterclaims that brought the multimillion-dollar verdict.

It was witness testimony that made the case, according to Peacock. He said his partner, Shawn Raymond, did a cross-examination to shred the credibility of Diamondback CEO Derrek Drury, who allegedly had kept changing his testimony. Also, Susman Godfrey associate Krisina Zuñiga made a difference in putting on a main witness, Repeat Precision president Grant Martin, Peacock said.

"This was the first witness she had ever put in on trial," Peacock said. "We take a lot pride at the firm in letting our young lawyers get real roles."

Diamondback's attorney, Decker Cammack, said that he's keeping all options open regarding an appeal.

"Our biggest disagreement was the case turned more on the court's interpretation of the agreement than anything else," said Cammack, member in Whitaker Chalk in Fort Worth. "We disagree with the court's interpretation."

Repeat Precision was also represented by Locke Lord partners Scott Hastings, Paul Schuster, Charles Phipps, and associate Anna Finger.

The underlying dispute centered around a tool that oil and gas drillers use to plug fracking wells. Diamondback owned a patent to a "disposable setting tool" and it licensed the technology to Repeat Precision. While Diamondback alleged the license was not exclusive and that it could still make and sell the tool, Repeat Precision countered that the license gave it the exclusive right to make and sell the tool.

The court ruled on April 3 that Diamondback should take nothing on its claims, and the court dismissed them with prejudice, according to the final judgment in Diamondback Industries v. Repeat Precision.

Judge Alan D. Albright of the U.S. District Court for the Western District of Texas in Waco awarded Repeat Precision actual damages of $17.1 million, enhanced damages of $11.4 million and exemplary damages of $11.5 million. Repeat Precision will collect postjudgment interest and its costs and attorney fees, which haven't yet been determined.

The court also granted a permanent injunction and declaratory relief that interpreted the licensing agreement in Repeat Precision's favor.

In the bench trial from Jan. 27 to 29, Diamondback's claims were a moving target and CEO Drury would come up with a new story as soon as Repeat disproved a claim, Albright wrote in his March 13 findings of fact and conclusions of law.

"Diamondback's story at trial was sometimes so internally inconsistent or implausible on its face as to key factual elements that it strained credulity to believe any of it," the judge wrote.

On the other side, Repeat Precision's counterclaims synced with the witnesses and documents at trial, the findings said.

Zuñiga said it was an honor to have a big role in the trial. She is a 2015 Stanford Law School graduate who's worked at Susman Godfrey for three years and previously completed two years of judicial clerkships.

"I worked on this case from the second we were retained. There was a lot of preparation that went into it," said Zuñiga. "I think it had significant impact: The main goal with Grant's testimony was to introduce Judge Albright to Repeat Precision, and give background to the judge on the company and also this dispute."