DUG Technology’s US subsidiary has been ordered to pay over US$2 million following a breach of contract ruling, but the company is gearing up to contest the judgment through appeals.
- DUG US found liable for breach of contract with damages of approx. US$270,000
- Supplier initially claimed US$2.4 million plus interest
- Court awarded US$1.85 million in attorney’s fees and US$8,000 in costs to supplier
- DUG US to file post-trial motions and appeal the judgment
- Legal proceedings stem from a disputed supplier invoice under an energy management services agreement
Background of the Dispute
DUG Technology Ltd, a leader in geoscientific computing, has provided an important update on ongoing legal proceedings involving its US subsidiary, DownUnder GeoSolutions (America) LLC. The dispute originated from a supplier invoice under an energy management services agreement, which escalated to litigation in the United States District Court for the Southern District of Texas.
The supplier initially sought damages exceeding US$2.4 million, alleging breach of contract by DUG US. However, after a trial in October 2025, the jury awarded the supplier significantly less, around US$270,000, indicating a partial victory for DUG US on the damages front.
Court’s Final Judgment and Financial Impact
Despite the reduced damages award, the court’s final judgment imposed a substantial financial burden on DUG US by ordering payment of approximately US$1.85 million in attorney’s fees, alongside US$8,000 in court costs and expenses. This fee award, which far exceeds the damages, reflects the court’s assessment of the legal costs incurred by the supplier.
DUG US has opposed the motion for attorney’s fees, arguing that the amount is excessive given the limited damages recovered by the supplier. The company’s stance highlights the complexity of legal cost awards, which can sometimes overshadow the underlying damages in commercial disputes.
Next Steps and Market Implications
In response to the judgment, DUG US plans to file post-trial motions seeking to have the decision set aside and intends to appeal the ruling. This signals ongoing legal uncertainty and potential further financial exposure depending on the outcomes of these proceedings.
For investors and market watchers, the case underscores the risks associated with contractual disputes in international operations, especially in sectors like energy management services where agreements can be complex and contentious. While the damages awarded were much lower than claimed, the significant legal fees highlight the broader cost implications of litigation.
DUG Technology’s commitment to keeping the market informed reflects good governance and transparency, but the situation remains fluid. The company’s ability to successfully challenge the judgment will be critical in shaping its financial outlook and investor confidence moving forward.
Bottom Line?
DUG’s legal battle is far from over, with appeals set to determine the final financial and reputational impact.
Questions in the middle?
- Will DUG US succeed in reducing or overturning the attorney’s fees awarded?
- How might this legal outcome affect DUG Technology’s broader contractual relationships and risk management?
- What impact could prolonged litigation have on DUG’s financial performance and investor sentiment?