Company sues water district over wells
Posted/updated on: July 12, 2026 at 5:02 am
HENDERSON COUNTY — A Dallas-area company, which is attempting to install dozens of high capacity water wells in East Texas, is suing a groundwater conservation district for their “deliberate scheme” to allegedly stop the company from drilling. As the fight for groundwater rights continue in Texas, the owners of Redtown Ranch Holding, LLC and Pine Bliss, LLC filed a lawsuit in federal court on Tuesday against the Neches and Trinity Valleys Groundwater Conservation District. This stems from a years long dispute, as they attempt to obtain permits to drill 43 water wells on their properties in Anderson and Henderson counties.
Since then, the plaintiffs have faced several obstacles after the district suspended their permits and allegedly blocked them from filing new applications under a new moratorium that was adopted in May.
The Background
In 2024, Redtown Ranch Holdings and Pine Bliss sought 43 permits from the state for high-capacity water wells on their properties, which span an approximate total of 11,500 acres across Anderson and Henderson Counties.
Shortly after passing through a few application processes, the NTVGCD voted to suspend all 40 permits after numerous East Texas public officials began to speak out against the proposed wells and their potential impact on the Carrizo-Wilcox Aquifer, which supplies water for the ranches’ groundwater and much of the counties.
Crockett City Administrator John Angerstein warned that those wells could extract up to 10 billion gallons annually from the aquifers.
“Yet none of this water is designated for our communities,” Angerstein told KETK News in 2025. “It is likely intended to support unchecked development and sprawl in other parts of Texas, presumably in the DFW metroplex or Hill Country, areas that have failed to plan responsibly for their own water needs.”
The ranches are allegedly tied to environmental sustainability private equity firm, Conservation Equity Management Partners, which is run by Dallas businessman Kyle Bass, founder and CEO of the firm.
According to the lawsuit, the groundwater conservation district suspended the permits to “appease” the interests of local farms, who allegedly see the two ranches as a “competitive threat.”
The lawsuit names Sanderson farms, a large Texas poultry producer, and the Consolidated Water Supply Corporation as the local interests — both of which draw water from the same aquifer as the two ranches.
In May, the district adopted a moratorium pausing all new groundwater use permits unless they fell under these exceptions:
Moratorium’s limited exceptions:
Applications pending that are administratively complete and were already received prior to moratorium adoption
Exempt well registrations
Non-exempt operating permit renewals
Non-exempt transport permit renewals
Amendments to an application that do not increase authorized production
Permit ownership transfers
Replacement wells that do not increase production capacity
The Lawsuit
The plaintiffs now seek fair compensation and relief from the district’s decision to adopt the moratorium that paused new groundwater-use permits and called it a “deliberate, targeted, and escalating campaign.”
In the lawsuit, the ranches claim that the moratorium “permanently restricts” their ability to exercise their groundwater rights and that the exceptions to the pause on permits don’t apply to them by design.
“The economic impact of the Moratorium on Plaintiffs is severe,” the lawsuit said. “Plaintiffs have invested substantial resources over more than two years in pursuit of their applications, including filing fees, hydrogeological studies, engineering analyses, legal costs, and other expenses directly related to the development of their groundwater estates. The moratorium renders those investments worthless for an indefinite period.”
Additionally, the lawsuit claims Redtown Ranch Holdings and Pine Bliss were not given due process, as the moratorium was adopted without providing them a notice or chance to be heard regarding the impact on their applications.
Following the lawsuit, our news partner KETK reached out the NTVGCD, to which they said they had no comment.
Kyle Bass released the following statement to KETK News:
“While I normally do not discuss pending litigation, I do want to say publicly that we followed the rules, invested years and significant resources in the process, and expected only that we would be treated fairly. However, even at this early stage, the District has put up a targeted and indefinite roadblock that prevents us from accessing, or even testing, the groundwater beneath our own land. As a result, I had no choice but to file suit.
This is bigger than just what happened to me. My lawsuit is about protecting the property rights of all Texas landowners and making clear that government regulators cannot simply change the rules to pick winners and losers.”
Bass’s attorney, Mollie Mallory, responded with the following statement to KETK News:
“Our clients spent years navigating the lawful regulatory process, only to confront a deliberate pattern of obstruction designed to thwart their efforts at every turn — most recently, through the District’s imposition of this moratorium. The government cannot weaponize its regulatory authority to deprive Texas landowners of the use of their own property, and we intend to hold the District fully accountable.”
