| NEW YORK
NEW YORK Jan 13 Anadarko Petroleum Corp
said it should pay as little as $850 million in damages over the
2005 spinoff of paint materials company Tronox Inc, 94 percent
below the maximum amount a federal bankruptcy judge said it
The estimate was provided on Monday, one month after U.S.
Bankruptcy Judge Allan Gropper in Manhattan said a higher payout
of $14.17 billion might be in order because Anadarko's
Kerr-McGee Corp unit intended to harm Tronox creditors by
saddling the spinoff with unsustainable environmental
His Dec. 12 decision sent Anadarko's share price down 6.4
percent the next day in part because the oil and gas exploration
company and some analysts expected damages would be much lower.
Tronox filed for Chapter 11 protection in 2009 and also sued
Anadarko and Kerr-McGee, which Anadarko had bought three years
earlier, claiming the spinoff was fraudulent because of the
In his 166-page decision, Gropper concluded that Kerr-McGee
"acted with actual intent to hinder or delay creditors," in a
spinoff that left Tronox "insolvent and undercapitalized (and)
was not made for reasonably equivalent value."
He said Anadarko might owe between $5.15 billion and $14.17
billion to a litigation trust set up for Tronox creditors.
But in a court filing on Monday, Anadarko said Gropper
misread Tronox's reorganization plan when determining liability,
and that any damages should simply, "restore the parties to
their pre-transfer positions."
Anadarko, which is based in The Woodlands, Texas, said net
damages should be $850 million, and no more than $1.76 billion.
REMEDIAL, NOT PUNITIVE
Gropper's findings are, "contrary to the court's stated view
that the purpose of the applicable law is 'remedial rather than
punitive,'" Anadarko Chief Executive Al Walker said in a
statement. "We continue to reserve all of our objections to the
opinion and our right to appeal."
John Hueston, a lawyer for the Tronox litigation trust, said
in an email: "We strenuously disagree with Anadarko's tortured
effort to rewrite Judge Gropper's findings and to define a new
and lower range of liability. We will provide an expansive
written response on February 12th."
Tronox makes titanium dioxide used in paints.
It has said it would receive no direct benefit from a
judgment, of which 88 percent would go to trusts for
environmental cleanup, and 12 percent to other claimants.
The litigation trust represents entities that claimed that
pollution attributable to Tronox resulted in health problems.
With the U.S. government's backing, it had sought $25
billion to clean up more than 2,000 U.S. sites.
Anadarko shares closed down $1.46, or 1.8 percent, at $78.37
on Monday. They closed at $83.67 on Dec. 12, 2013.
The case is Tronox Inc et al. v. Kerr McGee Corp et al.,
U.S. Bankruptcy Court, Southern District of New York, No.
(Reporting by Jonathan Stempel in New York. Editing by Andre