Land Commissioner Wins Lawsuit Against CEMEX

CEMEX failed to pay for building materials mined from land that belong to the Texas’ Permanent School Fund, and damages could be worth $500 million, the 8th District Court of Appeals in El Paso ruled Thursday.

Texas Land Commissioner Jerry Patterson filed a lawsuit against CEMEX in 2009, alleging the Mexican-based multinational corporation failed to pay for millions of tons of minerals from McKelligon Canyon, which is located in the Franklin Mountains.

“The gist of this case is simple: You just can’t take what’s not yours without a fight in Texas,” Patterson said in a news release. “As Texas land commissioner, it’s my job to look out for the school kids and to make sure they get their fair share. I’m very pleased about today’s outcome.”

According to the release, the state’s Permanent School Fund owns all minerals in McKelligon Canyon, which CEMEX and its predecessors have been mining and extracting since the 1940s without authorization from the state of Texas

Citing the Mining Act of 1895, Justice Guadalupe Rivera’s opinion found that, “title to all deposits of granite, limestone, gravel, sand and any other mineral substances of whatever kind or character having commercial value located on the McKelligon Canyon lands as herein identified are reserved to the State of Texas,” the release states.

The Texas General Land Office noted that when Texas won its independence from Mexico in 1836, its constitution required that vacant or unappropriated land remain in the public domain, and when Texas joined the Union, those vacant lands remained in the state’s public domain. The surface of most of the vacant lands — including McKelligon Canyon — was slowly sold off for nominal amounts and used by the original purchasers for grazing, agricultural and related purposes. The state, however, retained all valuable materials on, in and under the state’s lands for the benefit of public education.

According the news release, the Texas Permanent School Fund, worth about $25 billion, is made up of stocks, bonds and real estate investments. The Texas General Land Office leases surface acreage on behalf of the school fund, and charges royalties for the right to produce its mineral wealth, including oil, gas and other natural resources. Earnings from the fund help Texas public schools, from kindergarten through the 12th grade, using non-tax revenues that help offset local property taxes.