A Texas court has ruled in favor of KBR Inc on how the engineering company and former parent Halliburton Co should resolve a $256 million tax dispute, Halliburton said on Tuesday.
Halliburton had requested the appointment of an arbitrator to find that KBR owed it $256 million under the tax-sharing agreement. KBR denied it owed anything and argued Halliburton actually owed it money. In add ion, it said the dispute should be settled by arbitration under their master separation agreement instead.
Halliburton brought a lawsuit in the District Court of Harris County, Texas, to compel KBR to arbitrate the dispute under the tax sharing agreement.
The court found in favor of KBR in September, Halliburton said in its quarterly filing with U.S. securities regulators.
"We have filed a notice of appeal, which is pending," Halliburton said. "No anticipated recovery amounts or liabilities related to this matter have been recognized."
The tax-sharing agreement covers taxes for 2001 through their 2007 separation, which can only be finalized once the tax authorities and both companies analyze the results, according to Halliburton, the world's second-largest oilfield services company.
Since their split, the two companies have found themselves in court a number of times in cases related to KBR's extensive work for the U.S. military in Iraq. But they were then on the same side.
(Reporting by Braden Reddall in San Francisco; Editing by Dan Grebler)