TEXACO <TX> FILES TO ENJOIN 10.3 BILLION DLR BOND
Texaco Inc made a filing in a Texas
Court of Appeals to enjoin the enforcement of the 10.3 billion
dlr judgement pending appeal, an attorney for Pennzoil Co <PZL>
said.
    "They made the filing in the First Court of Appeals in
Texas," said John Jeffers, an attorney at the Houston law firm
of Baker and Botts representing Pennzoil.
    A Spokesman for Texaco had no immediate comment. Attorneys
representing Texaco were not immediately available.
    The filing follows yesterday's decision by the U.S. Supreme
Court, overturning a lower federal court decision that had cut
Texaco's bond to one billion dlrs. The high court ruled that
the issue should first be considered by Texas state courts.
    Texaco yesterday said it would soon file to prevent
enforcement of the bond, but it was unsure whether it would
make the filing in a District Court, the Court of Appeals or
the Texas Supreme Court.
    Jeffers said Texaco chose the Appeals Court because it
currently has jurisdiction in the case.
    According to Texas state law, Texaco could be forced to
post the full amount of the judgement as a bond. If it failed
to do so, Pennzoil could seek liens on Texaco's assets for the
amount of the judgement.
    Texaco's filing contains a request to cut the amount of the
bond to between one and 1.5 billion dlrs, Jeffers said. Asked
what Pennzoil's thought of that amount, he said, "I don't think
it's enough."
    Pennzoil has repeatedly said it would not seek to force
Texaco to post the full amount of the judgement in the form of
a bond, but has said it would seek other forms of security.
    "We've recognized there are other alternatives to a bond,"
Jeffers, the Pennzoil attorney, said.
    Pennzoil will also have the right to respond to the filing
but Jeffers said he was unsure when the response would be made.
    The dispute between Texaco and Pennzoil stems from the 1984
takeover of Getty Oil Co by Texaco. Pennzoil said the merger
violated a prior agreement it had to buy Getty and sued Texaco.
Since then, Pennzoil's position has twice been upheld by Texas
State Courts. The Judgement now stands at 10.3 billion dlrs,
including interest, and is on appeal.
 Reuter
