No Hurricane Required: Oracle's Force Majeure Play, Explained

Nerd LawyerRevenue Contracting Suite
Written By Curtis Wadsworth

Ask most people what force majeure means and you'll hear some version of "acts of God." Hurricanes. Earthquakes. War. Maybe a pandemic.

Last Thursday, Oracle showed why that answer is incomplete. According to Bloomberg, Oracle sent a force majeure notice on Project Jupiter, its 2.45-gigawatt Stargate data center campus in New Mexico. The reported reason wasn't a storm. It was power: a gas pipeline stuck in state permitting and an air permit still waiting on a hearing.

That's not an act of God. It's a permitting queue. Whether it counts as force majeure turns on one thing: what the contract actually says. That's true for a $165 billion data center, and it's true for the contracts sitting in your shared drive.

What Oracle Reportedly did

On September 24, Bloomberg reported that Oracle sent a force majeure notice to Stack Infrastructure, the Blue Owl Capital unit developing Project Jupiter. Oracle isn't walking away as the campus's main tenant. The notice reportedly preserves Oracle's ability to delay payments if the site misses its 2028 target to come online.

The stakes are real money. Bloomberg reported that Oracle could defer rent for up to three years if both sides agree a force majeure event tied to power commitments has occurred. Oracle's shares fell about 3% on the news.

The trigger is power. The campus is designed to run on gas-fired fuel cells. The Energy Transfer pipeline meant to feed it slipped to February 1, 2027, after the New Mexico State Land Office repeatedly denied permits for its route. The fuel cells' air-quality permit is still pending, with a state decision due by November 23.

Two other reported details matter for what follows:

  • Power was Oracle's job. A person familiar with the deal told Reuters that securing power is Oracle's responsibility under the contract, and that Oracle cannot terminate the lease.

  • The lease is reportedly hell-or-high-water. The Wall Street Journal reported that Oracle must pay rent whether or not it has secured power to run the site.

Both companies are playing it down. Oracle says the project remains on schedule and that notices like this are routine in projects of this size, used to preserve contractual rights. Blue Owl says the notice doesn't change anyone's financial commitments.

One caveat: the notice and the lease aren't public. Everything above comes from reporting, largely from unnamed sources.

Force majeure is a list you wrote

"Act of God" is an old common-law idea. A force majeure clause is something different: a contract term. Pennsylvania's Superior Court, like most jurisdictions, describes it as a list of events the parties agreed would excuse nonperformance.

That means the clause covers exactly what's on the list, and not much else. Modern clauses often go well beyond weather. They can include government action, permit denials, utility and fuel shortages, strikes, supplier failures, and pandemics. Others are one line of boilerplate that nobody read at signing.

So the real question is never "Was this an act of God?" It's "Is this on our list, and does our list excuse the thing we don't want to do?"

Four questions courts ask

Courts read these clauses narrowly. When a party claims force majeure, expect four questions.

1. Is the event actually on the list?

Morgantown Crossing v. Manufacturers & Traders Trust (E.D. Pa. 2004) is nearly a small-scale Project Jupiter. A shopping-center landlord promised a bank tenant it would obtain all construction permits by May 1, 2003. The township refused to sign the permit applications, and the landlord called that force majeure. The bank terminated the lease anyway, and the court sided with the bank.

The court's reasoning: a government permit delay wasn't like the events the lease listed, such as strikes, war, and unusual weather. Permit delays are a foreseeable part of real estate development. And an experienced developer had agreed to carry that risk.

Pennsylvania has applied this literal reading for nearly a century. In Sunseri v. Garcia & Maggini (Pa. 1929), the clause listed "crop failure." The court required a total failure, so a partial one didn't count.

2. Was it truly out of your control, and did you try?

The Commonwealth Court put the rule plainly in Martin v. Department of Environmental Resources (1988): "In order to use a force majeure clause as an excuse for non-performance, the event alleged as an excuse must have been beyond the party's control and not due to any fault or negligence by the non-performing party." The party claiming it carries the burden of proof. It must also show what it did to perform anyway.

Read Your List Before the Notice Arrives

Oracle's lawyers are reading their force majeure clause this week. Inside the Revenue Contracting Suite™, I draft the MSAs, SaaS terms, and SOWs that name the risks your deal actually runs on — permits, power, platforms — and decide who carries them. Don't let boilerplate decide for you.

Book a 20-Minute Call→

The Third Circuit adds a foreseeability lens. In Gulf Oil Corp. v. FERC (3d Cir. 1983), a gas supplier blamed routine equipment breakdowns. The court observed that "it is possible to accurately describe an event at its initial occurrence as unforeseeable and later because of the regularity with which it occurs, to find that such a description is no longer applicable."

Timing matters too. In Perlman v. Pioneer Limited Partnership (5th Cir. 1990), a lessee claimed state regulators were blocking his operations. The regulations hadn't actually been adopted yet. Because nothing had yet prevented his performance, the court held force majeure didn't apply.

3. Did you give notice the way the contract requires?

In Martin, the clause required phone notice within 5 days and written notice within 10. Martin missed the windows. The court held that failure rendered the force majeure clause "null and void." It also rejected his bad-weather and equipment-breakdown excuses because the clause didn't list them.

4. Does the clause reach the obligation you're trying to escape?

This is the question that matters most for Oracle, and Gulf Oil Corp. v. Federal Power Commission (3d Cir. 1977) is the case to know.

Gulf's clause was broad. It expressly covered the inability to obtain permits and rights-of-way, plus a catch-all for anything outside a party's control. Gulf argued that the federal government's failure to hold offshore lease sales was force majeure. The Third Circuit still ruled against it:

  • A carve-out beat the catch-all. The clause excluded failure of gas reserves or supply, and the specific exclusion controlled over the general language.

  • The real cause was Gulf's own. Gulf had overestimated its reserves. The court called its attempt to recast that as a permitting problem "somewhat disingenuous."

  • Gulf had made an unconditional promise. It had warranted delivery, and the court held force majeure couldn't excuse breach of that warranty.

The same logic governs payment obligations. In Gap Inc. v. Ponte Gadea New York (S.D.N.Y. 2021), the lease's force majeure definition covered government controls during an emergency. It gave no right to stop paying rent, so Gap owed the rent through its pandemic closures. Courts generally enforce hell-or-high-water payment terms just as strictly.

So where does that leave Oracle?

We don't know, and nobody outside the deal does. The lease isn't public, no court is involved, and this may never become a lawsuit.

Still, the case law shows why the reported details matter. If power really was Oracle's responsibility, that echoes the developer in Morgantown Crossing and Gulf in the 1977 case: a sophisticated party that took on a permitting risk. If the lease really is hell-or-high-water, courts rarely let force majeure cut through that kind of promise. And a notice about potential delays sits close to the speculation problem in Perlman.

There's another side. The reported three-year deferral mechanism is tied specifically to power commitments. That suggests the parties negotiated this exact risk up front, rather than leaving it to boilerplate. And as Martin shows, sending notice early can be the only way to keep a right alive. A notice is often the opening move in a negotiation, not a claim of victory.

Whether Oracle wins isn't the lesson here. The lesson is that the biggest players in tech read their force majeure clauses closely, and so should you.

What to do with your own contracts

You probably don't have a 2.45-gigawatt campus. You do have customer agreements, vendor contracts, office leases, and cloud commitments. Each one has a force majeure clause, and each one decides who eats the risk when something outside the deal goes wrong.

Before you sign the next one:

  1. Read the list. Don't assume "act of God" covers anything. Check what's actually named.

  2. Name the risks your business runs on. Permits, utility power, hosting and cloud outages, key suppliers, government action. If it matters, list it.

  3. Assign permitting and approval risk expressly. Say who is responsible for getting permits, and what happens if they're late.

  4. Decide whether force majeure excuses payment or only extends time. Most payment obligations survive force majeure. Know which way your contract cuts.

  5. Set notice terms you can actually meet. Then put them on a calendar. Martin lost his right by missing a 5-day window.

  6. Plan for the long outage. Add a mitigation duty, and a termination right if the event runs past a set number of days.

This is the work our Revenue Contracting Suite™ is built for. We draft MSAs, SaaS terms, and SOWs that allocate these risks on purpose, before a notice letter lands in your inbox. Talk to Nerd Lawyer.

Curt Wadsworth, J.D., Ph.D. is the founder of Nerd Lawyer Entrepreneur Services, an AI-native corporate and IP law firm serving founders, startups, SMBs, and growth-stage companies. Reach him at curt@nerdlawyer.ai.

This post is general information about legal developments, not legal advice, and does not create an attorney-client relationship. Facts about Project Jupiter are as reported through September 28, 2026.

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Curtis Wadsworth
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