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Anadarko-Tronox trial resumes

by on July 24, 2012 10:59 pm BST
 

Anadarko, the defendant, was expected to call
witnesses, starting with Joseph Flake, a former vice president at Kerr-McGee, the company now owned by Anadarko that
created Tronox through a 2005 spin-off, Reuters
reported.

Tronox, which went
bankrupt in 2009 and emerged last year, established a trust to pay billions of
dollars in environmental clean-up claims at more than 2000 polluted locations.
The trust’s main asset is the lawsuit against Anadarko, and money to fund the
trust will come from any proceeds of that litigation.

The trust says Anadarko is liable for the clean-up
costs. It argues that the Tronox spin-off was
fraudulent because it burdened Tronox with a
heap of environmental liabilities that rendered it insolvent from the get-go.

The trust is demanding $15 billion in assets and
another $10 billion in interest for clean-up costs, though some analysts say a
settlement would be no higher than $2.5 billion.

The US Department of Justice
and the Environmental Protection Agency have
joined the Tronox trust in the fight.

Earlier this month, Anadarko shares climbed on news
that the sides would halt the trial for a week to try to hammer out a
settlement, but came back to earth after the talks failed.

On the New York Stock Exchange on Tuesday, Anadarko
shares closed down $1.38, or 1.96%, to $68.91.

John Hueston, a lawyer for the Tronox litigation trust, declined to comment on
whether future litigation talks were planned, Reuters said.

John Christiansen, a spokesman for Anadarko, also
declined to comment, but has said in the past the company would prefer to
settle the dispute consensually.

Tronox makes titanium
dioxide used in paints.

The trial is taking place in US Bankruptcy Court in
Manhattan.