Knocked Down in Round 2

A Texas court upholds an $8.5 billion judgment against Texaco

More than a year ago, when a Houston jury ordered Texaco to pay Pennzoil an incredible $10.5 billion to settle their legal battle over a 1984 merger fight, many experts were convinced that the landmark judgment would be drastically reduced on appeal. But so far Texaco's lawyers have been unable to defuse this financial time bomb that threatens the survival of the third largest U.S. oil company. A Texas court of appeals last week upheld a staggering $8.5 billion of the original judgment.

+ Texaco Chief Executive James Kinnear was incredulous. "It is appalling," he said. "The decision supports an outrageous...

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