Former Executives Admitted NOV Underpaid Commissions Owed to Enhanced Industrial Technologies
New admissions from National Oilwell Varco's ((NOV) former senior executives reveal that the company reported costs instead of sales revenues when calculating commissions owed to Enhanced Industrial Technologies, LLC ("EIT") under a consulting agreement that helped launch NOV's oil & gas separations business. The admissions are central to the fraud and breach-of-contract lawsuit pending in Harris County District Court (Cause No. 2021-12076), in which EIT seeks $62 million in actual damages, plus punitive damages.
In sworn deposition testimony, Larry Engel, former President of NOV's Process & Flow Technologies division, confirmed that EIT was to be paid commissions based on the sales price of equipment, not its costs. Mr. Engel further admitted that he had no idea what the sales prices of the equipment were and never investigated whether NOV was paying EIT properly, despite personally reassuring EIT multiple times orally and in writing that it had been paid in full.
Similarly, Lionel Boudreaux, former VP of Process Equipment at NOV, and Mark Neuman, a former NOV Engineering Team Leader, each acknowledged that NOV was required to report the "sales value" of equipment sold—but instead reported only internal costs. As a result, commissions owed to EIT were significantly and systematically underpaid.
Despite these admissions, NOV has still not paid EIT its full commissions, more than a decade after the contract was signed and more than two years after confirming the underpayments. When asked about the testimony, John Ettere, the Founder of Enhanced Industrial Technologies, said: "All we ever asked was to be paid what we earned. NOV's own leaders have confirmed we were shortchanged — and yet they continue to stonewall."
Tom Schmidt of Schmidt Law Firm, counsel for EIT in the case, said: "NOV had a choice — honor their word, or enrich themselves at the little guy's expense." He added: "They chose the latter. Large companies should not behave that way. This lawsuit seeks to hold NOV accountable."
The lawsuit alleges that NOV breached its contractual obligations, misrepresented sales data, and committed fraud over the past decade.
No findings have yet been made by the Court. A copy of the Petition is available here.
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C. Thomas Schmidt
Schmidt Law Firm, PLLC
7880 San Felipe, Suite 210
Houston, TX 77063
(713) 568-4898
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