Tribe Joins $10.5B Oil Suit
Constitution Expert to Aid Pennzoil
Pennzoil this week called upon Harvard constitutional law expert Laurence H. Tribe '62 for help in its $10.53 billion law suit against Texaco.
Tribe, who is Tyler Professor of Constitutional Law, agreed to help Pennzoil appeal the latest decision in its ongoing legal battle with Texaco over an attempted takeover of Getty Oil.
Last November, a Texas jury ruled that Texaco pay Pennzoil an unprecedented $10.53 billion for interfering in Pennzoil's attempted partial takeover of Getty Oil.
In its initial suit, Pennzoil claimed that it had a binding agreement to buy a part of Getty Oil at the time that Texaco moved in and purchased the whole company. The Texas court agreed and last November slapped Texaco with what is by far the largest damage award an American court has imposed on a corporation.
Tribe's involvement stems from the recent entrance of a New York Federal District Court Judge into the case, which the Houston-based Pennzoil initiated in a Texas state court.
Last Friday, Judge Charles L. Brieant, who sits on the federal bench in White Plains, New York, waived a Texas law requiring Texaco to post a bond for the full amount of the penalty, plus interest, before it could proceed with its intended appeal.
Tribe said he became interested in the case because of Brieant's involvement. The judgement of a federal judge on a state ruling, Tribe said, raises questions concerning "the limits of federal judical power and the sovereignty of the state judicial system.
Pennzoil officials sought Tribe's help after reading his comments favorable to their position in The Wall Street Journal.
Brieant decided that Texaco could proceed with its appeal upon posting a bond of only $1 billion. If Texaco were not able to post a bond, Pennzoil could have begun to claim its award while appeal proceedings continued. Texaco claimed that such a requirement would have forced it into bankruptcy before it could complete its appeal.
If Brieant's decision were upheld, Tribe said, it would set a dangerous precedent that might upset the constitutional balance between the federal and state judicial systems. Tribe said such a ruling would encourage corporations to look nationwide for judges who would be willing to overturn unfavorable decisions.
"It would invite a jurisdictional Ping-Pong match between courts in various parts of the country," he said.
In his decision, Brieant wrote that the size of the bond the Texas law required was "just so absurd, so impractical and so expensive that it hardly bears discussion."
Man Who Wears The Star
However, Tribe said, a decision reached in a Texas court was not for a Federal judge in New York to pass judgement upon. Brieant's ruling in the case went beyond the bounds of legitimate federal judicial activism, he said.
"Whatever one thinks of the state court judge's ruling, there were other ways within the state for Texaco to proceed," he said. "Texaco should have to first argue the absurdity of the award in a Texas court."