Anadarko Petroleum Corp. and its Kerr-McGee Corp. unit must face some fraud claims brought by Tronox Inc. shareholders over the chemical maker’s bankruptcy, a judge ruled.
U.S. District Judge Shira Scheindlin in Manhattan today denied Anadarko’s motion to throw out allegations that it was responsible for the actions of Kerr-McGee, which served as its agent to control how Tronox reported reserves for environmental cleanup costs. She dismissed claims that Anadarko’s purchase of Kerr-McGee was a fraudulent act.
Tronox shareholders sued Anadarko in July 2009, seeking unspecified damages over two transactions. The first split off Kerr-McGee’s liabilities and chemicals business to create the company that went public in 2006 as Tronox. Anadarko then bought Kerr-McGee’s profitable oil and natural-gas business.
Tronox, based in Oklahoma City, filed for bankruptcy in 2009, facing claims of as much as $10.5 billion from the U.S. for environmental cleanup costs. The company’s creditors and the U.S. government also sued Anadarko and Kerr-McGee.
Scheindlin, in today’s order, allowed and also partly denied requests by officers Luke Corbett, Robert Wohleber and Gregory Pilcher to dismiss allegations of fraud.
Tronox fell 4 cents, or 3.3 percent, to $1.17 at 12:03 p.m. New York time in over-the-counter trading. Anadarko, based in The Woodlands, Texas, dropped 17 cents to $75.94 in New York Stock Exchange composite trading.
The case is In re Tronox Inc. Securities Litigation, 09-cv-6220, U.S. District Court, Southern District of New York (Manhattan).