Chamberlain, Hrdlicka, a law firm, engaged ESL Ventures (assignee of the cost-reduction consultancy Expense Reduction Analysts) to find savings on operating costs under a contract that let the firm terminate at any time but set an early termination fee that depended on timing.¹ Under the "Low Fee" provision, a termination after the Baseline Report but before the Recommendation Report required a fee of up to $40,000; under the "High Fee" provision, a termination after a successful Recommendation Report required a fee equal to 50% of projected savings for each project.² ESL presented its Baseline Report and began the Recommendation Report; the firm suspended the work, and the parties dispute whether an unsolicited copy of the Recommendation Report brought to a later meeting was "presented" under the contract.³ After a new CIO decided the firm did not need ESL, the firm terminated, believing it owed only the Low Fee, offered the full $40,000, and ESL refused it.⁴ ESL says the agreement had a variable termination fee with three measures of damages and that the firm admitted paying nothing.⁵

ESL's live pleading alleged only that Chamberlain incurred and failed to pay the High Fee, and its summary-judgment motion on liability was denied because the firm disputed that the Recommendation Report was presented.¹ At trial ESL moved orally for a directed verdict on the Low Fee theory only, and the trial court granted it.² The court then instructed the jury that Chamberlain had failed to comply with the agreement as a matter of law and that damages should be measured by the contract's early termination fee, and the jury awarded $700,000.³ The First Court of Appeals (Houston), in an opinion by Justice Goodman, affirmed, holding the directed verdict ambiguous and read as a verdict on "liability in general" that left the jury to decide which fee applied.⁴ The Court ordered merits briefing and granted review on June 12, 2026.

Petition for review from the First Court of Appeals (Houston); granted June 12, 2026. Oral argument: November 3, 2026.

• Chamberlain:¹ whether ESL, having moved for a directed verdict on an unpleaded Low Fee theory subject to a $40,000 cap and having disclaimed a verdict on its pleaded High Fee theory, could recover damages nearly twenty times that cap when the jury was told liability had been decided.
• ESL:² whether the lack of specificity in a directed-verdict motion is reversible error, or was waived by Chamberlain's failure to object, and whether the trial court granted a directed verdict on liability for breach after Chamberlain confessed it did not pay.

The dispute is about the scope of an oral directed verdict and how a reviewing court should construe it, which Chamberlain says is governed by Rule 268 and this Court's precedent on construing ambiguous orders, and which ESL says is not an evidentiary-sufficiency case.¹

What the directed verdict decided.

Chamberlain (Petitioner): A directed-verdict motion is the best guide to the scope of the order granting it; Rule 268 requires the motion to state its grounds, and ESL's motion sought a verdict only on the Low Fee theory, so the only liability finding was for the capped fee.¹ Even if the order were ambiguous, the court of appeals had to adopt the construction that applied Rule 268, and ESL's defenses would rewrite the contract and confuse liability with damages.²

ESL (Respondent): The court of appeals correctly held the directed verdict was granted on liability for breach, leaving damages to the jury, because Chamberlain confessed it breached and owed some amount, and the real dispute was the amount.³ Rule 268 does not stop a court of appeals from examining the whole record, the failure to state the ground is not error, and Chamberlain waived it by not objecting.⁴

The remedy.

Chamberlain (Petitioner): The Court should render judgment that ESL recover the $40,000 Low Fee maximum, and alternatively hold ESL waived its High Fee claim by failing to secure a finding on the condition precedent, the presentation of the Recommendation Report.⁵ In reply it says it would not oppose rendering judgment for $80,000 to avoid a remand.⁶

ESL (Respondent): The variable termination fee did not contain a condition precedent, and Chamberlain is re-litigating issues resolved below.⁷

Chamberlain argued the essential question is the scope of the directed verdict, which determines as a matter of law whether ESL could recover more than $40,000, and that the court of appeals ignored Rule 268 and misapplied this Court's precedent.¹ ESL argued the court of appeals correctly held the directed verdict was on liability for breach and that Chamberlain waived its Rule 268 complaint.²

None noted