A settlement has been reached between Anadarko Petroleum Corporation and Tronox, LLC in the adversarial case filed in the U.S. Bankruptcy Court for the Southern District of New York. In the settlement, Anadarko agreed to pay $5.15 billion to the trusts created out of the Tronox bankruptcy to settle the claims in the lawsuit. The settlement follows a ruling by U.S. Bankruptcy Judge Allan L. Gropper that the transfer of valuable oil and gas assets to a new company formed by Kerr-McGee Corporation and the related spin-off of Tronox, LLC with Kerr-McGee’s chemical business and over 75 years of legacy environmental sites and tort lawsuits was a fraudulent transfer. Judge Gropper’s Memorandum Opinion contemplated an award of damages to the Tronox trusts between $5.1billion and $14.1 billion.
Kerr-McGee Corporation completed the transfers of assets and spin-off of Tronox, LLC in 2005. Kerr-McGee Corporation was sold to Anadarko in 2006.
These corporate transactions and the Tronox v. Anadarko lawsuit gave rise to unique issues in bankruptcy law and in the areas of successor liabilities, indemnification agreements, and environmental liabilities and remediation. This blog will address some of these issues in detail in future entries. For further information, contact Toni Ellington at (504) 599-8500.