# Texaco, Inc.

> United States Bankruptcy Court, S.D. New York · February 21, 2025

URL: https://www.frixlaw.com/law-library/cases/10804218

## Case

- **Court:** United States Bankruptcy Court, S.D. New York
- **Decided:** February 21, 2025
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10804218

## How later opinions describe it (automated extraction)

- finding that courts in this district consider twelve factors when determining whether to permissively abstain under Section 1334(c)(1)
- finding that the permissive abstention factors are focused on “efficient bankruptcy administration”

## Opinion text

UNITED STATES BANKRUPTCY COURT FOR PUBLICATION
SOUTHERN DISTRICT OF NEW YORK

)
In re: ) Chapter 11
)
TEXACO, INC., et al., ) Case No. 87-20142 (DSJ)
)
Reorganized Debtor. )
)
DECISION AND ORDER GRANTING MOTION OF REORGANIZED TEXACO INC.
TO REOPEN THE DEBTORS’ BANKRUPTCY CASES & DENYING MOTION OF
REORGANIZED TEXACO FOR ENTRY OF AN ORDER ENFORCING THE
DISCHARGE AND INJUNCTION IN THE CONFIRMATION ORDER, PLAN, AND
BAR DATE ORDER
This decision and order (this “Decision”) resolves two related motions by successors to
the reorganized debtor (“Reorganized Texaco” or “Debtor”). Debtor asks the Court to reopen
the long-closed, 37-year-old bankruptcy case of the former Texaco Inc. and to hold that this
Court’s confirmation order and the confirmed plan’s discharge and injunction provisions bar
Louisiana parishes from pursuing recoveries for alleged environmental degradation and land loss
stemming from decades of Texaco activities in coastal areas of Louisiana. The present motions
arise from forty-two lawsuits against various oil and gas companies of which roughly twenty-two
list Reorganized Texaco and/or its affiliates as defendants. The suits (the “Louisiana Lawsuits”)
have been filed by the Parishes of Cameron, Jefferson, Plaquemines, and St. Bernard and by the
Louisiana Department of Energy and Natural Resources (“LDNR”, with Parish plaintiffs
collectively, the “Louisiana Plaintiffs”), along with other parishes in Louisiana, and seek to
hold Reorganized Texaco liable under Louisiana’s State and Local Coastal Resources
Management Act of 1978 (“SLCRMA”). The cases have been pending since 2013, and
Reorganized Texaco reports that the stakes are enormous, with potential liability in excess of
$100 billion, which is approximately half of Reorganized Texaco’s parent company’s (Chevron
Corporation’s) entire market capitalization. ECF No. 4009 ¶ 5 (defined below).
Reorganized Texaco depicts this as a straightforward matter. The Louisiana Plaintiffs
never filed proofs of claim during the Debtor’s bankruptcy, a Court-approved claims bar date
passed, and confirmation of the plan discharged and enjoined claims against the estate, whether a

proof of claim was or was not filed, other than as provided in the plan. As will be seen, the key
merits question is that the plan excepted from discharge many or all governmental environmental
claims, as defined and described further below. Reorganized Texaco argues that the Louisiana
cases they now face do not fit within the plan’s definition of preserved environmental claims,
and that, as a result, this Court should reopen the long-closed case to enforce the plan’s discharge
and injunction provisions and bar the Louisiana Lawsuits.
The Louisiana Plaintiffs oppose reopening on various grounds. First, as a procedural
matter that the Court finds sympathetic but unpersuasive, the Louisiana Plaintiffs argue that
Texaco waited too long such that the laches doctrine or other timeliness requirements counsel

against reopening the bankruptcy case. The Louisiana Plaintiffs observe that the cases pending in
Louisiana were far advanced and over a decade old before the Debtor sought relief from this
Court. Texaco disputes that it waited unreasonably long and argues that the passage of time is
not dispositive because the Debtor faces an avalanche of litigation in multiple courts, all of
which would need to grapple with a question that this Court is best positioned to answer. The
Court concludes that Texaco did unreasonably delay in bringing its motions by waiting until the
Louisiana Plaintiffs and the presiding courts had expended more than ten years in resource-
intensive litigation during which Texaco erected numerous procedural roadblocks, with Texaco
now attempting to derail the litigation during the bellwether case’s final run-up to trial.
Nevertheless, the Court concludes, as it has before, that there is a paramount bankruptcy-
court and systemic interest in having bankruptcy courts determine the meaning and impact of this
Court’s own prior orders. A decision by this Court would avoid repeated and possibly
inconsistent adjudication by multiple courts as to the meaning of an order entered long ago by
this Court, while also avoiding a risk of further, possibly wasteful litigation efforts in Louisiana.

Thus, interests of judicial efficiency and providing certainty to the parties convince the Court
that reopening the case is appropriate here. The Court therefore grants the Debtor’s motion to
reopen the bankruptcy case.
The merits of the Discharge Motion (defined below) boil down to whether the Louisiana
Plaintiffs’ claims fall within the confirmed plan’s provision that carves out governmental
environmental claims from the reach of the plan’s discharge and injunction provisions. The plan
excluded from discharge claims of governmental units arising under a long list of federal
environmental statutes, and under “other” environmental laws of the various states. Reorganized
Texaco insists that the governing Louisiana statute concerns permitting and land use and is not

the type of environmental statute that the plan contemplated be excluded; Debtor places great
weight on its contention that SLCRMA is not an “analog” to any federal statute that is listed as
falling within the scope of the plan’s exclusion of environmental claims.
The Court disagrees because the Louisiana statute at issue, although broad, incudes
substantial regulatory requirements and enforcement mechanisms that fall within the general
meaning of “environmental,” and the confirmed plan’s drafting as to state-law environmental
claims is elastic, and not limited to the analogs of the plan’s specifically listed federal statutes.
This conclusion is reinforced by the realities of the Debtor’s bankruptcy case, which was rooted
in the Debtor’s desperate need to resolve the status of a multi-billion-dollar judgment against it
held by Pennzoil, such that the Debtor made the reasonable decision to avoid expending the
enormous time and effort that would have been required to identify and resolve all of the
company’s environmental claims and obligations through the bankruptcy process. In seeking
confirmation, Texaco explained that it was achieving enterprise-critical objectives through its
bankruptcy, while leaving unaffected whatever governmental environmental liabilities it might

face as a result of its long history as an energy business. The Louisiana Lawsuits are one aspect
of the reckoning over those legacy liabilities that the debtor consciously chose to have pass
through the bankruptcy unaffected. For these reasons and as explained further below, the Court
denies the Discharge Motion.
I. BACKGROUND1
A. Texaco’s Chapter 11 Case and Subsequent Instances of Reopening the
Case
1. Texaco’s Chapter 11 Case
a. Background of the Chapter 11 Case

On April 12, 1987, Texaco, Texaco Capital Inc., and Texaco Capital NV (collectively,
“Pre-Plan Texaco”) filed for relief under Chapter 11 of the Bankruptcy Code. Reopen Motion ¶
5. The purpose of this filing was to compromise a judgment of $10.5 billion in favor of Pennzoil
rendered by a jury in 1985. See In re Texaco Inc., 254 B.R. 536, 541–42 (Bankr. S.D.N.Y. 2000)
(“Texaco filed under Chapter 11 for the sole purpose of compromising a $10.5 billion
judgment.”). Although Pre-Plan Texaco was a major, profitable international oil company with a

1 The parties submitted moving papers (by Reorganized Texaco), oppositions (by the Louisiana Plaintiffs), and
replies (by Reorganized Texaco). This Decision refers to the parties’ submissions on the two motions now before the
Court as follows: ECF No. 4008 (“Reopen Motion”); ECF No. 4022 (“Reopen Opp.); ECF No. 4063 (“Reopen
Reply”); ECF No. 4009 (“Discharge Motion”); ECF No. 4041 (“Discharge Opp.”); and ECF No. 4064
(“Discharge Reply”).
$2 billion book value net worth, the “sole” reason for the filing was to prevent the Pennzoil
verdict from “crippling” the company. Id.; see also In re Texaco Inc., 182 B.R. 937, 941 (Bankr.
S.D.N.Y. 1995) (“As appears from the disclosure statement, Texaco’s filing resulted from the
highly publicized $10.5 billion verdict in favor of Pennzoil…”).
In particular, Pre-Plan Texaco was concerned that Pennzoil would obtain judgment liens

against its assets, causing Pre-Plan Texaco to eventually become dismembered. See In re Texaco
Inc., 182 B.R. at 941. Pre-Plan Texaco repeatedly tried but failed to upset or appeal the
judgment, and ultimately filed a Chapter 11 bankruptcy petition with the goal of negotiating the
Pennzoil judgment and, in every other respect, continuing its profitable global operations in the
ordinary course of business post-petition and post-confirmation. See In re Texaco Inc., 182 B.R.
at 941; In re Texaco Inc., 254 B.R. at 542; see also Second Amended Disclosure Statement
Pursuant to Section 1125 of the Bankruptcy Code (“Disclosure Statement”), TA at 141–452 (“In
order to protect the value of Texaco,” the Texaco board approved the bankruptcy filing. “In
Texaco’s opinion, this was the only viable means by which Texaco could pursue its appeal of the

Pennzoil judgment” and prevent Pennzoil from “seiz[ing] and sell[ing] Texaco’s assets” pending
appeal.); Memorandum of Law in Support of Confirmation of the Second Amended Joint Plan of
Reorganization Proposed by Texaco Inc., Texaco Capital Inc., Texaco Capital N.V. and Pennzoil
Company Pursuant to Section 1129 of the Bankruptcy Code (“Texaco Memorandum in
Support of Confirmation”), at 14 (“[The Plan] provides the means through which Texaco can

2 Given the antiquity of Reorganized Texaco’s bankruptcy case and the difficulty of accessing the original pleadings,
for convenience and ease of access, this Decision cites to Reorganized Texaco’s appendix to the Motion for Entry of
an Order Enforcing the Discharge and Injunction in the Confirmation Order and Plan and the Bar Date Order (the
“Texaco Appendix” or “TA”) located at ECF Nos. 4010-4020, which contains relevant pleadings from the original
bankruptcy case. During its consideration of the Reopen and Discharge Motions, the Court asked Reorganized
Texaco to locate and provide additional materials including the briefs that Pre-Plan Texaco submitted to seek
approval of its Disclosure Statement and Plan (defined below). As of this writing, both Pre-Plan Texaco’s and
Pennzoil’s memoranda of law in support of confirmation have been found, but no other documents were obtained.
resolve expeditiously the only issue which caused the commencement of its chapter 11 case, the
disputed Pennzoil Judgment, and further allows Texaco to continue to operate as a viable
entity.”). In essence, this filing “provided Texaco with additional time to seek a reasonable
settlement of the [Pennzoil] controversy.” Disclosure Statement, TA at 145.
b. Chapter 11 Bar Date Order and Notice, Disclosure Statement,
and Plan
During the Chapter 11 case, Pre-Plan Texaco and Pennzoil settled their dispute for $3
billion payable in cash, and this Court approved the settlement in December 1987. In re Texaco
Inc., 182 B.R. at 941. Having reached this agreement, Pre-Plan Texaco turned its focus to
emerging from bankruptcy with a plan of reorganization. Id. Needing a quick turnaround, on
December 31, 1987, Pre-Plan Texaco filed a proposed “First Amended Joint Plan of

Reorganization” and a disclosure statement. Discharge Opp., at 11.
On January 26, 1988, this Court entered an order (“Bar Date Order”) that set March 15,
1988 (“Bar Date”), as the deadline to file proofs of claim against Pre-Plan Texaco. Discharge
Motion ¶ 17; Discharge Opp., at 11. Specifically, the Bar Date Order stated that “[a]ll proofs of
claim of creditors against the Debtors, except for creditors whose claims are described in
paragraph 3 below, shall be filed with the Court on or before March 15, 1988 . . . .” Bar Date
Order, TA at 1. One such group of exempted parties was described in subparagraph (g) as “[a]ny
governmental unit, including, without limitation, any federal, state or local agency, with respect
to a claim relating to the enforcement of environmental protection laws and regulations in

accordance with the following or similar statutes,” after which the Bar Date Order contained a
list of thirteen federal laws:
1. Clean Air Act, 42 U.S.C. §§ 7401 et seq.
2. Federal Water Pollution Control Act, 33 U.S.C. §§ 1251 et seq.
3. Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq.
4. Toxic Substances Control Act, 15 U.S.C. §§ 2601 et seq.
5. Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §§
9601 et seq.
6. Safe Drinking Water Act, 42 U.S.C. §§ 300F, et seq.
7. Surface Mining Control and Reclamation Act, 30 U.S.C. §§ 1201 et seq.
8. Marine Protection Research and Sanctuaries Act, 33 U.S.C. §§ 1401 et seq.
9. River and Harbor Act, 33 U.S.C., 33 U.S.C. §§ 401 et seq.
10. Deepwater Port Act, 33 U.S.C. §§ 1501 et seq.
11. Uranium Mill Tailings Radiation Control Act, 42 U.S.C. §§ 7901 et seq.
12. Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. §§ 136 et seq.
13. Mineral Leasing Act, 30 U.S.C. §§ 181 et seq.

(collectively, the “13 Federal Environmental Statutes”). Bar Date Order, TA at 4–5. The Bar
Date Order further stated that “[t]his order shall not apply to” governmental environmental
claims, among others, and that these government environmental creditors “are not required to”
file proofs of claim against Pre-Plan Texaco in order to participate in any distribution. Bar Date
Order, TA at 2.
To provide notice to all parties with potential claims about the requirements for filing
proofs of claim on or before the Bar Date, Pre-Plan Texaco sent and published a notice (“Bar
Date Notice”) that informed creditors that claims against the Debtor must be filed before the Bar
Date or be forever barred and discharged. Discharge Motion ¶ 18; see Bar Date Notice, TA at 7.
Like the Bar Date Order, the Bar Date Notice provided a list of creditors that “need not file
proofs of claim at this time,” which contained the same language quoted above from the Bar
Date Order describing subparagraph (g). Bar Date Notice, TA at 7–10. More than sixty thousand
copies of the Bar Date Notice were sent to parties-in-interest in Pre-Plan Texaco’s Chapter 11
case, including many of the Louisiana Plaintiffs and related entities.3 The Bar Date Notice was

3 The mailing matrix, TA at 376, included the following entries: “Louisiana Dept of Env | Quality | Office of Water
Resources," id. at 382; "Louisiana Dept Of Natural | Resources | Accounting Section," id.; "Louisiana Natural |
Resources Dept | Coastal Management Div," id.; "State Of La | Dept Of Natural Resources | Office Of
Conservation," id. at 385; "State Of Louisiana | Dept Of Conservation," id.; "Cameron Parish | Sheriff & Ex-Officio
not sent to the District Attorneys in the various parishes comprising the Louisiana Plaintiffs or to
the “Police Juries, Parish Presidents, or Parish Councils.” Discharge Opp., at 12, n. 29. None of
the Louisiana Plaintiffs filed proofs of claim. Discharge Motion ¶ 2.
Prior to the confirmation hearing, Pre-Plan Texaco made modifications to the originally
filed disclosure statement and plan. See Order (A) Approving Disclosure Statement, (B) Fixing

Time Within Which Equity Security Holders May Vote to Accept or Reject Plan of
Reorganization, (C) Fixing Date, Time and Place for Hearing on Confirmation of Plan of
Reorganization, (D) Approving Form of Ballot and (E) Approving Form of Notice for
Publication (“Disclosure Statement Order”), TA at 129. On January 27, 1988, Pre-Plan Texaco
filed its Second Amended Joint Plan of Reorganization Proposed by Texaco Inc., Texaco Capital
Inc., Texaco Capital N.V. and Pennzoil Company (“Plan”). See Plan, TA at 12. To consider
approval of the updated plan and disclosure statement, this Court held hearings on January 27
and 29, 1988. See Disclosure Statement Order, TA at 129. On January 29, 1988, this Court
approved Pre-Plan Texaco’s Disclosure Statement. See id.

c. Environmental Class: Plan Classification and Disclosure
Statement

The Plan filed by Pre-Plan Texaco defined several classes of claims, and placed most
unsecured claims in Classes 6-A, 6-B and 6-C. Discharge Motion ¶ 24 (citing Plan, TA at 36–
37). All allowed claims in these classes were to be paid in full, but to be allowed any claim had
to have been timely filed. Id. ¶ 28.
The Plan also provided for Class 3-B, which was defined as:

Tax Coll.," id. at 379; "Cameron Parish Clerk | Of Court," id.; "Jefferson Parish | Dept. Of Public Utilities," id. at
380; "Jefferson Parish | Sheriff's Office," id.; "Jefferson Parish | Tax Collector," id. at 381; "Jefferson Parish Clerk
Of | Court & Ex-Officio | Recorder," id.; "Jefferson Parish Sales Tax," id.; "Jefferson Parish Sherrifs Offi[ce]," id.;
"Plaquemines Parish | Clerk Of Court | & Ex Officio Recorder," id. at 383; "Plaquemines Parish | Tax Collector,"
id.; "St Bernard Parish Water | & Sewage," id. at 378; and "St. Bernard Parish | Sheriff's Dept.," id. at 384.
Unsecured Claims of the United States of America and other state and local
governmental units arising under the statutes set forth on Exhibit “6” attached
hereto and incorporated herein by reference and under other environmental
protection legislation, rules or regulations enacted, adopted or promulgated by
states or subdivisions thereof.

Plan, TA at 35–36. The referenced “Exhibit ‘6’” lists the 13 Federal Environmental Statutes. Id.,
TA at 128. In section IV.C of the Plan entitled “Unimpaired Class of Unsecured Claims Held by
the United States, Department of Energy and Claims Arising Under Environmental Laws,” the
Plan stated the following regarding Class 3-B claims:
Classes 3-A and 3-B are not impaired under the Plan. . . .The amount of any
Class 3-A or Class 3-B Claim that is not an Allowed Claim, and the holder’s
rights, if any, to payment in respect thereof, shall (a) be determined in the manner
and by the administrative or judicial tribunals in which the amount of such Claim
and the holder’s rights would have been resolved or adjudicated if the
Reorganization Cases had not been commenced, (b) survive the Confirmation
and consummation of the Plan as if the Reorganization Cases had not been
commenced, and (c) not be discharged pursuant to the Bankruptcy Code §
1141. The Plan shall leave unaltered the legal, equitable and contractual
rights to which each Class 3-A or Class 3-B Claim entitles its holder in
accordance with Bankruptcy Code § 1124.

Id., TA at 42–43 (emphasis added).
The Court-approved Disclosure Statement also discusses Class 3-B. In a letter to its
creditors encouraging them to vote for the Plan, Pre-Plan Texaco explained that the Disclosure
Statement “includes and describes” the Plan and urged creditors to read it “with care.”
Disclosure Statement Order, TA at 132. The Disclosure Statement proceeds to explain that it
contained “information of a kind and in sufficient detail, adequate to enable a hypothetical,
reasonable investor typical of the class of Texaco Stockholders to make an informed judgment
whether to accept or reject the Plan.” Disclosure Statement, TA at 136. The Disclosure Statement
also provided a “Summary of Classification and Treatment of Claims and Interests Under the
Plan,” which identified “Claims of the Department of Energy and Environmental Claims” as
being “Unimpaired; Allowed Claims paid in full, in cash, on the Effective Date; Claims which
are not Allowed Claims will not be discharged and will survive the Reorganization Cases and be
determined and paid as if the Reorganization Cases had not been commenced.” Id., TA at 138.
In defining “Environmental Claims,” the Disclosure Statement stated the following:

The Plan does not impair the Claims of the United States Department of Energy
(the “DOE”) and the claims of any governmental unit arising under any
environmental legislation (the “Environmental Claims”). All Claims of the
DOE and Environmental Claims not paid as hereinafter described will not be
discharged and will survive the Reorganization Cases as if they had not been
commenced. . . . Any Claims of the DOE and any Environmental Claims that are
not Allowed Claims will be resolved by the administrative and/or judicial
tribunals in which they would have been resolved had the Reorganization Cases
not been commenced.

Id., TA at 140 (emphasis added). The Disclosure Statement further stated, “[t]he Environmental
Claims relate to any Claims which have been or may be asserted by any governmental unit
arising under various federal or similar statutes regarding environmental protection and related
legislation, rules and regulations.” Id., TA at 160. As stated above, the Bar Date Order and Bar
Date Notice also contained similar language defining Class 3-B as including the claims of “any
governmental unit, including, without limitation, any federal, state, or local agency, with respect
to a claim relating to the enforcement of environmental protection laws and regulations in
accordance with the following or similar statutes.” Bar Date Order, TA at 4–5; Bar Date Notice,
TA at 9–10.
The Disclosure Statement stated that the exclusion of the Environmental Protection
Agency’s (“EPA”) and other agencies’ claims was in line with Pre-Plan Texaco’s goal of
expeditiously exiting bankruptcy and to “avoid delaying these [bankruptcy cases] to resolve any
potential dispute over [these] issues.” Disclosure Statement, TA at 160. In fact, the Disclosure
Statement explicitly stated that Pre-Plan Texaco was “unable to estimate with any degree of
certainty the amount of liability, if any, in respect of ‘Environmental Claims.’” Id. The
Disclosure Statement also noted that “following confirmation of the Plan, other environmental
actions or proceedings arguably arising from Texaco’s pre-petition acts may be asserted against
Texaco.” Id.

d. Confirmation Order and Discharge
As stated above, the Plan discharged a wide array of pre-confirmation claims: “[e]xcept
as otherwise provided in the Plan or in the Confirmation Order, Confirmation shall operate as a
discharge, pursuant to Bankruptcy Code § 1141(d)(1), effective as of the Effective Date, of any
and all debts of and Claims against one or more of the Debtors that arose at any time before
Confirmation. . .” Plan, TA at 53. Thus, the Plan’s discharge provisions precluded future
assertions of pre-petition claims, except those expressly exempted from discharge such as claims
classified in Class 3-B. See Discharge Motion ¶ 28.
To consider whether to approve the proposed Plan, this Court held a confirmation hearing

on March 22, 1988. See Discharge Motion ¶ 29. The day after the hearing, this Court entered the
confirmation order (“Confirmation Order”) approving the Plan. See Confirmation Order, TA at
342. The order’s language describing the discharge matched the Plan:
Except as otherwise provided herein and in the Plan, and effective as of the
Effective Date of the Plan, in accordance with section 1141(d) of the Bankruptcy
Code, each of the Debtors be, and it hereby is, discharged of and from any and all
debts and Claims that arose against it before the date of entry of this order . . .
whether or not (i) a proof of claim based on such a debt is filed or deemed filed
under section 501 of the Bankruptcy Code, (ii) such Claim is allowed under
section 502 of the Bankruptcy Code, or (iii) the holder of such Claim has accepted
the Plan.
Id., TA at 348–49. The Confirmation Order also enjoined anyone from pursuing discharged
claims: “[t]he commencement or continuation of any action, the employment of process, or any
act to collect, recover or offset any debt discharged hereunder as a personal liability of any of the
Debtors, or from property of any of the Debtors, be, and it hereby is, permanently enjoined,
stayed and restrained.” Id., TA at 349–50.

The effective date of the Plan was at least fifteen days after the date of the Confirmation
Order, with an additional requirement that there were no stays of the Confirmation Order and
that all conditions in the Plan’s Article VIII were met or waived. Plan, TA at 17. On April 7,
1988, the Court issued a “Notice of (i) Confirmation of Plan of Reorganization and (ii) Discharge
of Debts” (“Notice of Confirmation”), which confirmed that Pre-Plan Texaco was “discharged
from any and all debts . . . that arose . . . before the date of entry of the Confirmation Order, . . .
other than . . . [c]ertain unsecured debts arising under environmental laws which are not Allowed
Claims, as defined in and more fully described in the Plan: whether or not (i) a proof of claim
based on such debt was filed or deemed filed . . . .” TA at 357–58 (emphasis added).

2. Subsequent Decisions Reopening the Bankruptcy Case

At several times since the Texaco case was deemed fully administered and was closed,
Reorganized Texaco’s bankruptcy case was reopened to address a number of issues that
implicated the confirmed Plan. See In re Texaco Inc., 182 B.R. 937 (Bankr. S.D.N.Y. 1995); In
re Texaco, Inc., No. 05 CIV. 7533 (CLB), 2006 WL 8462735 (S.D.N.Y. June 20, 2006); Texaco
Inc. v. Kling Realty Co. (In re Texaco Inc.), No. 87 B 20142 (RDD) (Bankr. S.D.N.Y. Aug. 3,
2010), aff’d, No. 10-CV-8151, 2011 WL 4526538 (S.D.N.Y. Sept. 28, 2011), aff’d. In re Texaco,
Inc., 505 F. App’x 77) (2d Cir. 2012); Order Granting Motion of Texaco Inc. for Order
Reopening Texaco’s Chapter 11 Case, Feb. 12, 2017, ECF No. 3923. In each of these instances,
this Court granted Reorganized Texaco’s motion to reopen the bankruptcy case and entered an
order enforcing the discharge against the various litigants who contended that their claims were
not discharged. None of the prior reopening decisions turned on whether an involved litigant
held an environmental claim that should be categorized as a Class 3-B claim and therefore
survive unaffected by Reorganized Texaco’s bankruptcy. Consequently, an in-depth discussion

of the specific facts of these prior decisions is not necessary or instructive for the purposes of this
Decision.
B. Legal Basis for Louisiana Plaintiffs’ Claims
The federal Coastal Zone Management Act, 16 U.S.C. §§ 1451 et seq. (“CZMA”), was
enacted in 1972 and authorizes states to develop coastal management programs. Considering the
“increasing and competing demands . . . occasioned by population growth and economic
development” and “the urgent need to protect and to give high priority to natural systems in the
coastal zone,” Congress passed the CZMA to expand the ability of state coastal zone
management programs to address coastal environmental problems. 16 U.S.C. §§ 1451, 1452. The
CZMA authorizes states to develop and subsequently submit coastal management programs for

approval by the National Oceanic and Atmospheric Administration (“NOAA”), a federal agency
within the Department of Commerce. Id. §§ 1454, 1455, 1511.
In 1980, the NOAA approved SLCRMA, again Louisiana’s State and Local Coastal
Resources Management Act of 1978, La. Rev. Stat. § 49:214.21 et seq. (1978), which established
a comprehensive regulatory regime that regulates the various “uses” of the Louisiana coastline
and requires “coastal use permits” for any non-exempt uses thereof. See La. Rev. Stat. §
49:214.30. A use is defined as “any use or activity within the [Louisiana] coastal zone which has
a direct and significant impact on [its] coastal waters.” Id. § 49:214.23(13). Uses subject to the
costal use permitting program include “mineral activities, including exploration for, and
production of, oil, gas, and other minerals, all dredge and fill uses associated therewith, and all
other associated uses,” with the caveat that presently-existing permits issued pursuant to
statutory authority of the Louisiana Office of Conservation within the LDNR shall be issued in
lieu of “coastal use permits” provided that these permits comply with the applicable state and
federal guidelines. Id. §§ 49:214.25(A)(1)(f), 49:214.31(B). SLCRMA became effective in

September 1980, and the statute contains a “grandfather clause” that exempts activities that were
“lawfully commenced and established” prior to 1980 from requiring a permit. Id. § 49:214.34.
The program is administered by the LDNR through the Office of Coastal Management, whose
primary function is to issue permits with the purpose of balancing uses and economic
development with the need to protect and restore the coastal region of the state. See id. §§
49:214.26, 49:214.22.
The SLCRMA declares that it is the public policy of the State of Louisiana “[t]o develop
and implement a coastal resources management program which is based on consideration of [the
state’s] resources, the environment, the needs of the people of the state, the nation, and of state

and local government.” Id. § 49:214.22(5). This declaration continues, “it is the public policy of
the state . . . [t]o support and encourage multiple use of coastal resources consistent with the
maintenance and enhancement of renewable resource management and productivity, the need to
provide for adequate economic growth and development and the minimization of adverse effects
of one resource use upon another, and without imposing any undue restriction on any user.” Id.
The Coastal Use Guidelines issued under SLCRMA include specific guidelines for oil,
gas, and other mineral activities. See La. Admin. Code tit. 43, pt. I, § 719 (1980). For example,
the Coastal Use Guidelines provide that exploration and production facilities shall be designed,
constructed, and sustained “to maintain natural water flow regimes, avoid blocking surface
drainage, and avoid erosion,” and that “[d]rilling and production sites shall be prepared,
constructed, and operated using the best practical techniques to prevent the release of pollutants
or toxic substances into the environment.” Id. § 719(D), (F). Further, the guidelines state that
“[m]ineral exploration, production, and refining facilities shall be designed and constructed using
best practical techniques to minimize adverse environmental impacts.” Id. § 719(J). Finally,

subsection (M) specifically provides that “[m]ineral exploration and production sites shall be
cleared, revegetated, detoxified, and otherwise restored as near as practicable to their original
condition upon termination of operations to the maximum extent practicable.” Id. § 719(M).
Subsection (36) of SLCRMA provides for enforcement of the statute. See La. Rev. Stat. §
49:214.36. The statute stipulates that the secretary of the LDNR and each local government with
an approved program has the power to initiate a “field surveillance program” to ensure proper
enforcement of the program, to issue cease and desist orders, to suspend, revoke, or modify
coastal use permits, and to bring injunctive, declaratory, or other actions as necessary, among
other listed powers. See id. Additionally, if a party is found to violate SLCRMA, a court may

“impose civil liability and assess damages,” “order . . . the payment of restoration costs,” and/or
“require . . . actual restoration of areas disturbed,” among other relief. Id. § 49:214.36(E).
C. State Litigation History
Starting in 2013, the Louisiana Plaintiffs, along with a few other parishes in Louisiana,
filed forty-two state-court lawsuits against various oil and gas companies for violations of
SLCRMA. See Discharge Motion ¶¶ 40–41; Reopen Opp., at 1. Twenty-two4 of these lawsuits
seek to hold Reorganized Texaco and/or its affiliates liable for violations of SLCRMA from oil
and gas activities conducted in the Louisiana coastline region, which allegedly caused damage in

4 At times, the parties say twenty-three lawsuits involve Reorganized Texaco. The exact number is immaterial to this
Decision.
the form of land loss and contamination. See Discharge Motion ¶ 41–43; Reopen Opp., at 1. The
Louisiana Plaintiffs assert no claims under any other state law. Discharge Motion ¶ 41.
Specifically, the petitions (the term for complaints in Louisiana state court) seek damages
and other relief based on alleged violations of coastal use permits issued under SLCRMA and
based on alleged violations of SLCRMA resulting from Texaco’s failure to obtain permits for

non-exempt uses of the coastal zone after SLCRMA became effective. See Discharge Opp., at
26, 28. For example, in The Parish of Plaquemines v. Rozel Operating Company, et al., No. 60-
966 (La. 25th Judicial Dist.), the Louisiana Plaintiffs’ prayer for relief requests the following: (1)
“[a]warding damages and other appropriate relief specifically provided in [SLCRMA]”; (2)
“[o]rdering the payment of costs necessary to clear, revegetate, detoxify and otherwise restore
the Plaquemines Parish Coastal Zone as near as practicable to its original condition pursuant to
[La. Admin. Code tit. 43, pt. I, §§ 705(N), 711(F), and 719(M)]”; and (3) “[r]equiring actual
restoration of the Plaquemines Parish Coastal Zone to its original condition,” among others.
Petition for Damages to the Plaquemines Par. Coastal Zone, Par. of Plaquemines v. Rozel
Operating Co., et al., No. 60-996, (La. 25th Judicial Dist.) (“Rozel Petition for Damages”), TA

at 414–15. In the preceding paragraph in the Rozel Petition for Damages, Louisiana Plaintiffs
also seek declaratory relief in addition to money damages to “accomplish the purposes of [La.
Rev. Stat.] § 49:214.36 et seq.” Id., TA at 414.
All forty-two of these suits were removed to the United States District Courts for the
Eastern and Western Districts of Louisiana on various grounds, but were, eventually, remanded.
Discharge Opp., at 1. After remand, the state district judge in the Plaquemines Parish “cleared
most of his calendar for a year” and scheduled five of the Plaquemines Parish cases for trial. Id.
The first of these twenty-two cases to be set for trial was Par. of Plaquemines v. Rozel Operating
Co., et al., No. 60-996 (La. 25th Judicial Dist.) (“Rozel”), which was scheduled for trial nearly
six years ago, in March 2019. Id. In preparation for the Rozel trial, “the parties conducted
extensive discovery, which included numerous written interrogatories, requests for production
and requests for admission, the exchange of thousands of pages of documents and corporate
records custodian depositions.” Reopen Opp., at 10.

As required by a case management order that was entered in the state district court,
Plaquemines Parish filed its preliminary expert report (the “2018 Rozel Report”) on April 30,
2018. Id., at 11–12. Before any case could be tried, however, all forty-two cases were removed
by defendants and Reorganized Texaco moved for MDL treatment of all the cases. Discharge
Opp., at 2. As quoted by the Fifth Circuit in Plaquemines Par. v. Chevron USA, Inc., Judge
Feldman of the United States District Court of the Eastern District of Louisiana characterized
Reorganized Texaco’s alleged attempt to delay this case as “shameful.” Discharge Opp., at 2
(citing 84 F.4th 362, 368 (5th Cir. 2023) (“On remand, Judge Feldman agreed with Plaquemines
Parish at oral argument that it was ‘bordering on absurd’ that jurisdictional litigation had delayed

these cases for so long. He then added, ‘Frankly, I think it’s kind of shameful.’ That very same
day, he reaffirmed his previous remand order, finding ‘[f]or a third time,’ that ‘these cases’ do
not ‘belong in federal court.’”)).
After remand was granted in Par. of Cameron v. Auster Oil & Gas, Inc., No. 10-19582
(La. 25th Judicial Dist.) (“Auster”), the Cameron Parish district judge set a jury trial to begin
November 27, 2023. Reopen Opp., at 13. In that case, the parties exchanged extensive discovery,
including depositions, documents, and expert reports. See id., at 13–14. After the state district
court ruled on several summary judgment motions and motions challenging the expert reports,
the Auster case settled shortly before the trial was set to begin. See id., at 14. Shortly thereafter,
the Rozel case was set for trial on March 10, 2025. Id.; Discharge Motion ¶ 42. In June and July
of 2024, the Plaquemines Parish served further expert reports setting forth details of the theories
of liability that it intended to pursue in Rozel. Discharge Motion ¶¶ 42, 44–45. These expert
reports are the bases on which Reorganized Texaco asserts that it first learned that the Louisiana
Plaintiffs were seeking relief for pre-confirmation conduct, thus, according to Reorganized

Texaco, leading to the current motions to reopen the bankruptcy case and enforce the discharge.
See Reopen Motion ¶¶ 1–2, 4.
In Rozel, the Louisiana Plaintiffs are seeking to recover $3.4 billion for implementing a
restoration plan that would “bring the Gentilly case area back to a wetland area similar to historic
conditions (1940 land area),” restore soil and sediment, and remove wastewater from the area.
Discharge Motion ¶¶ 44, 5 (citing Jenneke M. Visser, Expert Rep. on Restoration (July 26,
2024) filed in Par. of Plaquemines v. Rozel Operating Co., No. 60-966 (La. 25th Judicial Dist.),
TA at 869; Gregory W. Miller & Jason Sills, Expert Rep. (July 29, 2024) filed in Par. of
Plaquemines v. Rozel Operating Co., No. 60-966 (La. 25th Judicial Dist.), TA at 643). Rozel is

just one of twenty-two cases filed against Reorganized Texaco and involves only 2.7% of the
pre-confirmation Texaco wells at issue in these suits. Id. ¶ 5. Consequently, Reorganized Texaco
contends that “[i]f the Louisiana Plaintiffs seek a comparable recovery on a per-well basis in the
other cases, their claimed damages would presumably exceed $100 billion, which is
approximately half of Reorganized Texaco’s parent’s (Chevron Corporation’s) entire market
capitalization.” Id.
D. Parties’ Arguments
As stated in the introduction above, the parties have filed various motions, oppositions,
and replies. This Court first broadly summarizes each in turn, with more detail provided in the
pertinent discussion section.
1. Reopen Motion and Discharge Motion

On November 15, 2024, Reorganized Texaco moved to reopen its bankruptcy case
pursuant to Sections 105(a) and 350(b) the Bankruptcy Code, Rule 5010 of the Bankruptcy
Rules, and Rule 5010-1 of the Local Bankruptcy Rules for the Southern District of New York.
See Reopen Motion. In its motion, Reorganized Texaco contends that although the Louisiana
Plaintiffs have long disavowed that they were pursuing claims that were discharged, the
“recently served” expert reports in Rozel demonstrate that Louisiana Plaintiffs seek to hold
Reorganized Texaco liable for pre-confirmation conduct. Id. ¶ 1. The Debtor argues that some or
all of these claims were discharged and enjoined as a result of the Confirmation Order, Plan, and
Bar Date Order. Id. ¶ 2. In the Reopen Motion, the Debtor seeks to reopen the bankruptcy case
for the limited purpose of determining whether any of the Louisiana Plaintiffs’ claims were
indeed discharged and barred. Id. ¶ 4.
Also on November 15, 2024, Reorganized Texaco filed a motion seeking entry of an
order enforcing the discharge and injunction as provided in the Debtor’s previous bankruptcy’s

Confirmation Order, Plan, and Bar Date Order on the theory that the Louisiana Plaintiffs’ claims
arose pre-petition and were discharged. See Discharge Motion ¶ 2.
2. Reopen Opp. and Discharge Opp.
On November 20, 2024, the Louisiana Plaintiffs filed an opposition to the Reopen
Motion. See Reopen Opp. In their opposition, they argue that Reorganized Texaco unduly
delayed seeking to reopen the bankruptcy cases, after the company already caused substantial
and unjustified delays with various removal attempts. Id., at 2–4. The Louisiana Plaintiffs object
that reopening this case would severely prejudice them given that trial in Rozel is scheduled for
March 2025. Id., at 2–3.
On December 5, 2024, the Louisiana Plaintiffs filed their opposition to the Discharge
Motion. See Discharge Opp. The Louisiana Plaintiffs maintain that their claims constitute Class
3-B claims and accordingly were unaffected by the Plan’s discharge provisions. See Discharge
Opp., at 11–24. The Louisiana Plaintiffs also contend that this Court should refrain from
deciding the Discharge Motion based on doctrines including permissive abstention under 28

U.S.C. § 1334, Burford abstention, and laches. See id., at 24–37.
3. Reopen Reply and Discharge Reply
On December 9, 2024, Reorganized Texaco filed a reply in response to the Reopen Opp.
See Reopen Reply. Debtor’s reply contends that discharge is not subject to equitable defenses
such that laches cannot bar its request for relief, that the supposed delay asserted by the
Louisiana Plaintiffs is both mischaracterized and irrelevant, and that abstention is inappropriate
in these circumstances, among other arguments. Id.
Also on December 9, 2024, Reorganized Texaco filed a reply in response to the
Discharge Opp., reiterating that the Louisiana Plaintiffs’ claims should not be categorized in

Class 3-B, and that neither abstention nor laches should prevent the court from deciding the
motion. See Discharge Reply.
II. JURISDICTION
The Court has subject matter jurisdiction over the present motions under 28 U.S.C. §§
157(a)–(b) and 1334(b), and the reservation of jurisdiction in the Plan and Confirmation Order.
See Confirmation Order ¶ 29, TA at 352 (“The Court shall retain jurisdiction in accordance with
(and as limited by) Article IX of the Plan and section 1142 of the Bankruptcy Code.”); Plan §§
IX.A.1, 2, & 7, TA at 63, 65. Venue is appropriate under 28 U.S.C. § 1409(a).
III. DISCUSSION
A. Reopen Motion
1. Legal Standard

Pursuant to Bankruptcy Rule 5010, a bankruptcy case may be reopened “[o]n the debtor’s
or another party in interest’s motion.” Fed. R. Bankr. P. 5010. Under Section 350(b) of the
Bankruptcy Code, “[a] case may be reopened in the court in which such case was closed to
administer assets, to accord relief to the debtor, or for other cause.” 11 U.S.C. § 350(b). The
Bankruptcy Code does not specify what constitutes “cause” to reopen a closed case. See In re
Solutia, Inc., 653 B.R. 99, 113 (Bankr. S.D.N.Y. 2023). Rather, the determination of whether a
case should be reopened for other cause “invoke[s] the bankruptcy court’s equitable powers,
which is dependent on the facts and circumstances of the case.” Id. (citing Katz v. I.A. All. Corp.
(In re I. Appel Corp.), 104 Fed. App’x 199, 200 (2d Cir. 2004)). This decision is “committed to
the ‘broad discretion’ of the bankruptcy court.” Id. (citing Batstone v. Emmerling (In re
Emmerling), 223 B.R. 860, 864 (B.A.P. 2d Cir. 1997)). In exercising this broad discretion, a
court “may consider numerous factors including equitable concerns, and ought to emphasize

substance over technical considerations.” In re Atari, Inc., No. 13-10176 (JLG), 2016 WL
1618346, at *4 (Bankr. S.D.N.Y. Apr. 20, 2016) (quoting In re Emmerling, 223 B.R. at 864).
Bankruptcy courts in this district have considered the following six factors to be relevant
to motions to reopen:
(1) the length of time that the case was closed;
(2) whether a nonbankruptcy forum has jurisdiction to determine the issue that is
the basis for reopening the case;
(3) whether prior litigation in the bankruptcy court determined that another court
would be the appropriate forum;
(4) whether any parties would suffer prejudice should the court grant or deny the
motion to reopen;
(5) the extent of the benefit to any party by reopening; and
(6) whether it is clear at the outset that no relief would be forthcoming if the
motion to reopen is granted.

In re Easley–Brooks, 487 B.R. 400, 407 (Bankr. S.D.N.Y. 2013); see Atari, 2016 WL 1618346,
at *4–5 (applying the factors). The burden of demonstrating circumstances sufficient to justify
reopening the case is on the moving party. Easley–Brooks, 487 B.R. at 406. As this Court has
previously explained, “it is well settled that the ‘bankruptcy court is undoubtedly the best
qualified to interpret and enforce its own orders including those providing for discharge and
injunction.’” In re U.S.H. Corp. of New York, 280 B.R. 330, 335 (Bankr. S.D.N.Y. 2002)
(quoting In re Texaco, Inc., 182 B.R. 937, 947 (Bankr. S.D.N.Y. 1995)).
2. Parties’ Contentions
a. Reorganized Texaco’s Motion to Reopen
Reorganized Texaco contends that its Reopen Motion was triggered by the fact that
although the Louisiana Plaintiffs have long disavowed that they were pursuing claims that were
discharged, the “recently served” June and July 2024 expert reports in Rozel revealed that the
Louisiana Plaintiffs seek to hold Reorganized Texaco liable for pre-confirmation conduct that
Texaco contends was discharged and enjoined as a result of the Confirmation Order, Plan, and
Bar Date Order. Reopen Motion ¶¶ 1–23.
The Debtor first argues that reopening is appropriate under the 11 U.S.C. § 350(b) to
“accord relief to the debtor,” which in this case, comes in the form of enforcing the injunction
provisions in the Confirmation Order, the Plan, and Bar Date Order. Id. ¶ 10.

The Debtor then contends that reopening this bankruptcy case is also appropriate for a
second reason set forth in 11 U.S.C. § 350(b)—“for other cause”—which Reorganized Texaco
argues affords the bankruptcy court “broad discretion.” Id. ¶ 11. Applying the six-factor test
recited above, first, the Debtor maintains that this Court can best determine whether the
discharge in the Plan bars the Louisiana Lawsuits because this Court is best qualified to interpret
its own prior orders and because the Plan and Confirmation Order explicitly reserved this Court’s
jurisdiction to decide such issues. Id. ¶ 12. Second, Reorganized Texaco argues that “no party
would be improperly prejudiced” by this Court reopening the case to decide these issues because,
notwithstanding that the Louisiana Lawsuits have been pending for “several years” (sic), the

petitions that they initially filed were allegedly “vague and general, and expressly disavowed
asserting discharged claims.” Id. ¶ 13. The Debtor claims that it “[o]nly recently” realized that
the Louisiana Plaintiffs alleged (or sought recovery for) pre-confirmation conduct when the
expert reports connected to the Rozel suit were shared in June and July of 2024. Id. ¶ 13. Debtor
also argues that the large potential recovery further “evidences the necessity of redress in this
Court.” Id. ¶ 13. Third, Reorganized Texaco emphasizes that this Court is uniquely qualified to
“interpret and enforce past orders” and that such a determination “would provide a significant
benefit to litigants as it could narrow or even eliminate many of the claims asserted in the
Louisiana Lawsuits,” thereby allegedly “streamlining any remaining litigation in the Louisiana

courts.” Id. ¶ 14. Lastly, the Debtor notes that this Court has reopened these Chapter 11 cases
multiple times in the past to enforce provisions in the Confirmation Order and Plan. Id. ¶ 15.
b. Louisiana Plaintiffs’ Opposition to the Motion to Reopen
The Louisiana Plaintiffs argue that Reorganized Texaco’s bankruptcy case should not be
reopened and that the Louisiana state court should decide issues related to discharge. See
generally Reopen Opp.
First, the Louisiana Plaintiffs argue that both timeliness factors identified in In re Easley–
Brooks weigh against reopening: (1) the bankruptcy proceeding was finalized over thirty years
ago, and (2) Reorganized Texaco was aware that the Louisiana Plaintiffs’ complaint concerned
pre-confirmation operations from at least when it received the 2018 Rozel Report, yet
Reorganized Texaco nevertheless delayed filing its motion by six years, waiting until just a few
months before the lead case is scheduled for a lengthy trial in Louisiana state court. See Id., at 3,
18. The Louisiana Plaintiffs further maintain that “if the timing of a motion is a ‘stalling tactic’
to delay state-court litigation, then the court should not reopen the case.” Id., at 17 (citing

Redmond v. Fifth Third Bank, 624 F.3d 793, 799 (7th Cir. 2010); Matter of Bianucci, 4 F.3d 526,
527–29 (7th Cir. 1993)).
Second, the Louisiana Plaintiffs claim that they would be prejudiced by further delays in
the event that the Court reopens this case, as this would disrupt “trials currently scheduled in
multiple cases in 2025.” Id., at 3. They explain that the parties in the state suits have “conducted
substantial fact and expert discovery, expended considerable amounts on experts, and conducted
significant motion practice. . . .” Id. They claim that the Debtor has “engaged in a consistent
practice of delay, preventing the [Louisiana Plaintiffs] from obtaining substantive relief.” Id.
And they claim that, if this Court grants Reorganized Texaco’s motions, the scheduled March

2025 trial almost surely cannot go forward because the case has been prepared in reliance on
proof that heavily involves Texaco’s pre-petition activities. See id.; see also Transcript of Dec.
12, 2024 Hearing at 114-115, In re Texaco Inc., No. 87-20142 (2024).
Lastly, the Louisiana Plaintiffs argue that the Court should consider a number of
“substantive issues” in deciding the Reopen Motion, namely whether the Louisiana Lawsuits are
an exercise of police power, whether the court should abstain, whether the Louisiana Lawsuits
cover post-confirmation conduct and whether such conduct is dischargeable, whether the Debtor
provided actual or constructive notice of the Bar Date to the Louisiana Plaintiffs, whether the
Debtor waived its claim to rely on this Court’s discharge order because of their failure to raise
this defense in state court, and whether laches applies. Id., at 18–19. Finally, the Louisiana
Plaintiffs contend that abstention is appropriate in this case. Id., at 9
c. Reorganized Texaco’s Reply
Reorganized Texaco’s reply re-asserts that discharge is not subject to equitable defenses,
especially laches, because a discharge voids any judgment obtained against the Debtor. See

Reopen Reply ¶¶ 3–4. Debtor emphasizes that this Court has so found in a prior decision
reopening the Texaco bankruptcy case. Id. ¶ 10 (citing Transcript of May 28, 2010 Telephone
Hearing at 11, Kling Realty Co. v. Texaco, Inc. (In re Texaco, Inc.), No. 87-20142 (2010)
(“neither waiver nor laches apply here given primarily the fact that under the bankruptcy code,
the discharge which in a Chapter 11 case benefits not only the debtor but the debtor’s creditors
and in a solvent case the debtor’s shareholders cannot be waived by conduct or even an
agreement without proper approval under Section 524 of the bankruptcy code”)). As to
abstention, the Debtor argues that there is a presumption in favor of courts exercising their
jurisdiction and thus against abstention that the Louisiana Plaintiffs have not overcome; that the

Louisiana Plaintiffs premise their arguments incorrectly by treating the merits of the Louisiana
Lawsuits instead of the Discharge Motion as the proceeding in favor of which they would have
this Court abstain; and that even setting this issue aside, the factors courts apply to abstention
motions counsel against abstention. See id. ¶¶ 19–26. Specifically, Reorganized Texaco contends
that: (1) the bankruptcy question of plan interpretation predominates over, and the Court need
not even decide, the merits of the Louisiana Lawsuits themselves; (2) the two cases relied on by
the Louisiana Plaintiffs are inapposite and contrary to more relevant authority; (3) Debtor did not
concede that the Louisiana Lawsuits are an exercise of police power during their removal
attempts and the Discharge Motion is a core proceeding “arising in” Reorganized Texaco’s
bankruptcy case; and (4) the factors considered in evaluating permissive abstention are focused
on “efficient bankruptcy administration” and that interest would be disserved by requiring the
state court to decide the case only for the Debtor to ask this Court to determine if the judgment is
void after the fact. Id. (internal citation omitted). On this final point, the Debtor reasons that this
Court is in the best position to interpret its own orders, and it will be far more efficient to have

this Court decide the discharge issue now rather than after some or all of the state court cases
conclude. Id. ¶ 6.
Reorganized Texaco also dismisses the Louisiana Plaintiffs’ other arguments. Id. ¶¶ 16–
18, 28–34. First, the Debtor maintains that even though delay would not justify denying its
motion, Reorganized Texaco did not unreasonably delay because it was not apprised of the
significance of the Rozel case allegations of pre-confirmation conduct until the June and July
2024 expert reports, and, in the other twenty-one state-court cases, “discovery either has not
started or is in its infancy.” Id. ¶ 5. Second, Reorganized Texaco argues whether the Louisiana
Lawsuits are an exercise of police power is irrelevant as the Bankruptcy Code does not protect

claims of government units from discharge. Id. ¶ 28. Lastly, Reorganized Texaco disputes the
plaintiffs’ contention that the Louisiana Plaintiffs’ SLCRMA claims are administrative claims.
Id. ¶ 31.
3. Merits of the Reopen Motion
For reasons detailed below, the Court grants the motion to reopen the main bankruptcy
case notwithstanding the passage of many years since confirmation, and notwithstanding
Reorganized Texaco’s troubling decision not to approach this Court until after more than a
decade of intensive litigation of the Louisiana Lawsuits, during which the parties and the
Louisiana courts (federal and state) invested enormous effort and expense. The essence of the
Court’s conclusion is that reopening Reorganized Texaco’s case is the best way—really the only
feasible way—to achieve a prompt, actionable, and broadly applicable determination of the
impact of Reorganized Texaco’s discharge on the Louisiana Lawsuits. The unpalatable
alternative if this Court refused to reopen the case would be to oblige the interpretation and
application of this Court’s order by multiple courts that did not issue the order or preside over the

case, in the course of multiple, resource-intensive trials that also will address complex and
important merits issues. The result would be to risk inconsistent outcomes interpreting this
Court’s discharge order while consigning litigants to potentially fruitless and burdensome trials
and associated litigation.
This broad conclusion is reinforced by application of the Easley–Brooks factors that
apply to motions to reopen closed bankruptcy cases. See 487 B.R. at 407. First, this Court’s
Confirmation Order explicitly retained jurisdiction to decide issues relating to this case.
Confirmation Order ¶ 29, TA at 352 (“The Court shall retain jurisdiction in accordance with (and
as limited by) Article IX of the Plan and section 1142 of the Bankruptcy Code.”). Although the

state and bankruptcy courts in this case have concurrent jurisdiction to decide whether the
Louisiana Plaintiffs’ claims in the state court actions have been discharged, this Court has a
strong interest in construing the meaning of its own confirmation orders, which are central to the
case and to the institutional role of this Court. See In re Texaco, Inc., 182 B.R. 937, 947 (Bankr.
S.D.N.Y. 1995) (finding that the “bankruptcy court is undoubtedly the best qualified to interpret
and enforce its own orders including those providing for discharge and injunction”); In re U.S.H.
Corp. of New York, 280 B.R. 330, 335 (Bankr. S.D.N.Y. 2002). Indeed, this Court has
emphasized this consideration in repeatedly reopening the Texaco bankruptcy case to resolve
earlier disputes about the meaning of the Confirmation Order and discharge. See supra at I. A. 2.
Second, the potential benefits of reopening this case include allowing this Court to
construe its own Confirmation Order and Plan and to decide whether and to what extent the
Louisiana Plaintiffs’ claims are barred by the discharge. In essence, either this Court will
determine that these claims are what the Plan termed Class 3-B claims, and thus not blocked by
the discharge such that the Louisiana Lawsuits can continue as planned, or this Court will

determine that these claims are not excepted from the Plan’s discharge, which would preclude
recoveries for any of the pre-petition conduct at issue in the state court cases. Either way, the
parties will benefit from the informed assessment and broadly applicable answer that this Court
is uniquely able to provide. Moreover, proceeding in this Court is consistent with the widespread
recognition that enforcement of bargained-for rights under a Plan justifies reopening a
bankruptcy case. See Atari, 2016 WL 1618346, at *11 (“Courts have held that the need to
enforce rights that were bargained for in a confirmed plan of reorganization constitutes a
sufficient benefit to justify reopening a bankruptcy case.”) (internal quotation marks omitted).
Third, reopening the case will yield effective and beneficial relief by determining

whether the labor-intensive Louisiana Lawsuits are or are not precluded (in whole or in
substantial part) by the bankruptcy discharge.
Fourth, reopening this case will not prejudice either party. The Louisiana Plaintiffs
contend that they would be prejudiced by further delays which would disrupt “trials currently
scheduled in multiple cases in 2025,” especially the first case set for trial in Rozel in March
2025. See Reopen Opp., at 3. They note that the parties in the state suits have “conducted
substantial fact and expert discovery, expended consideration amounts on experts, and conducted
significant motion practice.” Id. Despite the legitimacy of these concerns, however, reopening
this case to decide the applicability of the discharge as set forth in this Court’s Confirmation
Order will not cause prejudice. On the contrary, a decision regarding whether discharge is
applicable to the multitude of cases would be decisive as to a specific issue applicable to the
Louisiana Lawsuits before any trial is to occur. Such a decision would promote judicial
efficiency as the state courts in the twenty-two lawsuits would not each need to engage in the
exercise of interpreting this Court’s prior order. Furthermore, as the Court promised the parties at

the hearing on December 12, 2024, this Decision is being issued weeks before the Rozel trial
date.
The Easley–Brooks factor related to timeliness does weigh in favor of the Louisiana
Plaintiffs, that is, against reopening. With respect to timing, the inquiry focuses on two distinct
and significant time frames: (1) the length of time between the estate’s closing and the motion to
reopen, and (2) the length of time a party waits before filing a motion to reopen. See In re
One2One Communs., LLC, 627 B.R. 273, 284 (Bankr. D.N.J. 2021). First, Reorganized Texaco’s
bankruptcy case was finalized approximately 36 years ago—by any measure, long ago. Second,
although Reorganized Texaco downplays the length of time it knew that the Louisiana Plaintiffs’

allegations concerned pre-petition conduct, the petitions date back to 2013 and clearly implicate
decades-long conduct by Pre-Plan Texaco. The Court credits the Louisiana Plaintiffs’ contention
that the Debtor knew or should have known the plaintiffs were pursuing remedies for pre-
confirmation conduct since at least when the Debtor received the 2018 Rozel Report, and yet
Debtor delayed filing the Reopen Motion for six years. The Debtor maintains that it only recently
realized that the Louisiana Plaintiffs sought recovery for pre-confirmation conduct when the
expert reports particularizing the theories of liability connected to the Rozel suit were disclosed
in June and July of 2024. See Reopen Opp., at 18; see also Reopen Motion ¶ 13. But Debtor’s
professed surprise rings hollow given the case’s age and the scope of activity that is clearly
implicated. Debtor has identified no disavowal of any intention of the Louisiana Plaintiffs to
remediate alleged harms that they surely contend result from longstanding defendant activities.
Indeed, Louisiana Plaintiffs further maintain that if the timing of a motion indicates a
“stalling tactic” to delay state-court litigation, then the courts should not reopen the case. Reopen
Opp., at 17 (citing Redmond v. Fifth Third Bank, 624 F.3d 793, 799 (7th Cir. 2010)). They claim

that the Debtor has “engaged in a consistent practice of delay, preventing the [Louisiana
Plaintiffs] from obtaining substantive relief” with their various removal attempts and the current
belated motion to reopen the bankruptcy case. Id., at 2–3.
As an initial matter, as noted, this Court finds unconvincing the Debtor’s argument that it
was only recently apprised of the pursuit of recovery for pre-confirmation conduct. The Debtor
was put on notice of the pre-confirmation allegations from the petition (complaint in Louisiana
state court) that was filed in Rozel on November 8, 2013, which alleged: “[s]ince 1978 and
before, Defendants’ oil and gas activities have resulted in the dredging of numerous canals in,
through, and across the Operational Area,” and “Plaintiffs allege that most, if not all, of

Defendants’ operations or activities complained of herein were not ‘lawfully commenced or
established’ prior to the implementation of the coastal zone management program [in
1980].” Rozel Petition for Damages ¶¶ 25, 29, TA at 407, 409 (emphasis added) (internal citation
omitted). Despite Debtor’s glib assertion that these claims are “vague and general,” these
allegations at a minimum gave Debtor ample reason to inquire about the scope of conduct at
issue and to seek relief in this Court. See Reopen Motion ¶ 13. Further, Debtor’s other contention
that it relied on the Louisiana Plaintiffs’ “expressly disavow[ing] asserting discharged claims” is
unpersuasive as the Louisiana Plaintiffs could easily (and reasonably) believe their claims were
exempted from discharge by being categorized as an environmental claim protected by Class 3-B
of the Plan. See id. ¶ 13. The Court therefore faults the Debtor for not asserting discharge as a
defense for the past eleven years.
By way of possibly unnecessary piling on, Louisiana Plaintiffs further detail a number of
discovery requests in Rozel and Reorganized Texaco’s responses that indicate that the Debtor
was on notice that their pre-confirmation conduct is at issue, such as the Louisiana Plaintiffs’

defining the relevant period in their discovery requests as January 1, 1920, through November 8,
2023. See Reopen Opp., at 10. And, even if one believed the Debtor was not adequately put on
notice by the Rozel Petition for Damages or the ensuing discovery process, Debtor was certainly
put on notice that Louisiana Plaintiffs were seeking recovery for pre-confirmation conduct when
it received the 2018 Rozel Report. That report contained numerous references to pre-
confirmation conduct, such as the following:
Texaco discovered the Delacroix Island Field in 1941 and completed the first well
for early production in the 8,900 ft. sand in late 1941. . . . By the early 1950’s,
approximately 35 wells had been drilled in the field. . . . By 1987, fifty-four wells
were drilled in the field that Texaco continued to operate.

Additional Exhibits to Declaration of Victor Marcello, Dec. 5, 2024, ECF No. 4043–4061, at PA:
0006146–47. Texaco simply could not have justifiably assumed until 2024 that only post-
bankruptcy conduct was at issue. Contra Reopen Motion ¶ 13.
The cases that the Louisiana Plaintiffs cite as support for refusing to grant unreasonably
late motions to reopen are inapposite. Neither of the two primary cited cases involved a motion
to reopen on the grounds of enforcing the discharge in Bankruptcy Code Section 524(a), and
both opinions noted that other factors also weighed in favor of the objecting parties. See
Redmond v. Fifth Third Bank, 624 F.3d 793, 799–803 (7th Cir. 2010) (declining to reopen when
there was a significant delay and the movant’s request for relief lacked facial validity); Matter of
Bianucci, 4 F.3d 526, 527–29 (7th Cir. 1993) (holding that delay in addition to other factors
counseled against reopening a case to address a lien that debtor failed to avoid that was not
discharged).
Although the Easley–Brooks timeliness factor weighs against the Debtor, it does not win
the day because it is outweighed by other compelling reasons to reopen the bankruptcy case. As
stated above, bankruptcy courts have broad discretion to reopen a case and may consider

equitable concerns with an emphasis of substance over technical considerations. See In re Atari,
Inc., 2016 WL 1618346, at *4. Here, reopening Reorganized Texaco’s bankruptcy case is
appropriate and necessary to provide a prompt decision addressing whether the Plan’s discharge
applies to the Louisiana Lawsuits. In fact, at oral argument on December 12, 2024, the Louisiana
Plaintiffs themselves acknowledged that their most preferred outcome would be for the Court to
reopen the case and rule in their favor on the merits of the Discharge Motion. Transcript of Dec.
12, 2024 Hearing at 113, In re Texaco Inc., No. 87-20142 (2024). The Court concludes that
reopening Reorganized Texaco’s bankruptcy case is warranted in these circumstances.
4. Other Arguments Against Reopening by Louisiana Plaintiffs

The Louisiana Plaintiffs also assert that this Court should refrain from reopening this case
and deciding the Reopen and Discharge Motions on grounds of, alternatively, abstention under
28 U.S.C. § 1334, Burford abstention, and laches. See Discharge Opp., at 25–37; Reopen Opp.,
at 8–9. The Court is unpersuaded by these arguments.
a. Abstention under 28 U.S.C. § 1334
The Court disagrees with the Louisiana Plaintiffs’ contention the Court should abstain
from deciding the Reopen and/or Discharge Motions under 28 U.S.C. § 1334.
Bankruptcy courts may abstain from hearing a proceeding “in the interest of justice, or in
the interest of comity with [s]tate courts or respect for [s]tate law.” 28 U.S.C. § 1334(c)(1). In
deciding whether permissive abstention is warranted, courts consider twelve factors:
(1) the effect or lack thereof on the efficient administration of the estate if a Court
recommends abstention, (2) the extent to which state law issues predominate over
bankruptcy issues, (3) the difficulty or unsettled nature of the applicable state law,
(4) the presence of a related proceeding commenced in state court or other
nonbankruptcy court, (5) the jurisdictional basis, if any, other than 28 U.S.C. §
1334, (6) the degree of relatedness or remoteness of the proceeding to the main
bankruptcy case, (7) the substance rather than form of an asserted “core”
proceeding, (8) the feasibility of severing state law claims from core bankruptcy
matters to allow judgments to be entered in state court with enforcement left to
the bankruptcy court, (9) the burden [on] the court’s docket, (10) the likelihood
that the commencement of the proceeding in a bankruptcy court involves forum
shopping by one of the parties, (11) the existence of a right to a jury trial, and (12)
the presence in the proceeding of nondebtor parties.

In re WorldCom, Inc. Sec. Litig., 293 B.R. 308, 332 (S.D.N.Y. 2003); Delaware Tr. Co. v.
Wilmington Tr., N.A., 534 B.R. 500, 512 (S.D.N.Y. 2015) (finding that courts in this district
consider twelve factors when determining whether to permissively abstain under Section
1334(c)(1)). When assessing whether to grant abstention, courts may consider one or more of
these factors. See In re MatlinPatterson Glob. Opportunities Partners II L.P., 2022 WL
17744002, at *4 (Bankr. S.D.N.Y. Dec. 16, 2022). “It follows that a court need not plod through
a discussion of each factor in the laundry lists developed in prior decisions.” Id. (internal
quotation marks omitted). “The movant bears the burden of establishing that permissive
abstention is warranted.” Id. (citing In re Residential Cap., LLC, 515 B.R. 52, 67 (Bankr.
S.D.N.Y. 2014); In re Waterscape Resort LLC, 2013 WL 819748, at *2 (Bankr. S.D.N.Y. Mar.
5, 2013)). Importantly, federal courts have a “virtually unflagging obligation” to exercise
jurisdiction given to them, so the abstention determination “begins with a presumption in favor
of the exercise of federal jurisdiction and against abstention.” In re MatlinPatterson Glob.
Opportunities Partners II L.P., 2022 WL 17744002, at *3–4 (internal citations omitted).
As an initial matter, without needing to address the above-listed factors, the Louisiana
Plaintiffs have applied their abstention doctrine analysis to the incorrect dispute. Instead of
applying the factors to the Reopen or Discharge Motion, the Louisiana Plaintiffs apply them to

the merits of the Louisiana Lawsuits. The issues raised in those lawsuits, in essence whether Pre-
Plan and/or Reorganized Texaco’s activities violated SLCRMA, are not before this Court. The
Discharge Motion raises questions related to Reorganized Texaco’s bankruptcy, namely the
meaning of this Court’s prior orders in this case. If the Court reopens this case and decides the
Discharge Motion, the Louisiana state courts will have a bankruptcy court decision that either
indicates (1) that the Louisiana Plaintiffs’ suits were exempted from the discharge, or (2) that
recoveries based on Reorganized Texaco’s pre-confirmation conduct are barred by the Plan’s
discharge and injunction. The Louisiana Plaintiffs claim that “should the court elect not to
abstain, it would be required to perform the arduous if not impossible task of untangling the

activities and damages of [Reorganized Texaco] that occurred pre and post discharge, as well as
untangling [Reorganized Texaco]’s activities and damages from its co-defendants.” Discharge
Opp., at 26. This is simply not true.
Rather, because the motions before this Court turn on bankruptcy law and Texaco’s
bankruptcy case, the following factors all weigh against permissive abstention: “the extent to
which state law issues predominate over bankruptcy issues”; “the difficulty or unsettled nature of
the applicable state law”; “the feasibility of severing state law claims from core bankruptcy
matters to allow judgments to be entered in state court with enforcement left to the bankruptcy
court”; and “the degree of relatedness or remoteness of the proceeding to the main bankruptcy
case.” In re WorldCom, Inc. Sec. Litig., 293 B.R. 308, 332 (S.D.N.Y. 2003). Again, this Court
need not interpret the complex issues raised in the Louisiana Lawsuits, but rather must construe
this Court’s prior orders in Reorganized Texaco’s bankruptcy case. In fact, the relevant factors
weigh strongly against abstention because, at some point, a court will need to decide whether the
Louisiana Plaintiffs’ claims for pre-confirmation conduct in all twenty-two suits are barred by

this Court’s prior order. Deciding this issue in piecemeal fashion during or after each of the
twenty-two suits, and potentially having judgments found to be void, would be wildly inefficient
for Courts and litigants alike. It would undoubtedly benefit all the parties and courts involved for
this Court to decide whether Louisiana Plaintiffs’ claims have been discharged and enjoined
before all these suits go to trial. See Waleski v. Montgomery, McCracken, Walker & Rhoads, LLP
(In re Tronox), 603 B.R. 712, 726 (Bankr. S.D.N.Y. 2019) (finding that the permissive
abstention factors are focused on “efficient bankruptcy administration”).
Lastly as to reopening, the Louisiana Plaintiffs maintain that this case is factually similar
to Placid Oil Co. v. C.C. Abbitt Farms, LLC (“Placid Oil”), in which a bankruptcy court

abstained from deciding whether the discharge injunction barred state court suits related to oil
wells because it “would require substantial inquiry into facts and deeds and land use,” spanning
three decades. Reopen Opp., at 8–9 (citing Placid Oil Co. v. C.C. Abbitt Farms, LLC, 561 B.R.
60, 69 (2016)). As Reorganized Texaco responds, however, Placid Oil is distinguishable because
the “state-court plaintiff voluntarily dismissed with prejudice the portion of its case seeking
liability for discharged claims, which mooted the adversary proceeding to enforce the discharge,”
and, while the court did affirm the decision to abstain, it did so only as to whether other claims in
the case were barred by the discharge. Reopen Reply ¶ 23. This Court agrees with Reorganized
Texaco’s analysis of the case and finds that the Placid Oil case is dissimilar to the facts at hand.
Even if this were not true, the Court would exercise its discretion by not abstaining given the
compelling practical reasons to decide the Discharge Motion now.
b. Burford Abstention
The Court also rejects the Louisiana Plaintiffs’ arguments that are based on the Burford
abstention doctrine.

The Burford abstention doctrine instructs a federal court to abstain from exercising
jurisdiction when (1) “there are difficult questions of state law bearing on policy problems of
substantial public import” or (2) “the exercise of federal review . . . would be disruptive of state
efforts to establish a coherent policy.” New Orleans Pub. Serv., Inc. v. Council of New Orleans,
491 U.S. 350, 361 (1989) (internal quotation marks omitted). Burford abstention is an
“extraordinary and narrow exception to a federal court’s duty to exercise jurisdiction.” Tribune
Co. v. Abiola, 66 F.3d 12, 17 (2d Cir. 1995) (quoting Colorado River Water Conservation Dist.
v. United States, 424 U.S. 800, 813 (1976)).
Courts in this district have identified a number of factors to consider in determining

“whether federal court review would work a disruption of a state’s purpose to establish a
coherent public policy on a matter involving substantial concern to the public.” See, e.g., Liberty
Mut. Ins. Co. v. Hurlbut, 585 F.3d 639, 650 (2d Cir. 2009) (applying the factors). Here, this
Court need not consider these factors because the Louisiana Plaintiffs’ arguments are based on
the incorrect premise that Reorganized Texaco is asking this Court to decide the merits of the
Louisiana Lawsuits. As stated above, this Court is not being asked to decide issues relating to
“Louisiana’s regulations applicable to oil and gas uses of its coastal zone” or adjudicating any of
the state-law issues to be decided by the Louisiana state courts. See Discharge Opp., at 34. This
Court is asked to interpret its own prior orders and decide the bankruptcy-law question of
whether the Louisiana Lawsuits are barred by the Plan’s discharge provisions. Once such a
determination is made, assuming the Louisiana Lawsuits go forward, the state courts will decide
those cases’ controlling merits issues. Thus, it is simply not true that “[t]he risk of conflicts
between federal and state judicial interpretations of the SLCRMA and its implementing
regulations are substantial.” See Discharge Opp., at 34.

Thus, this Court declines to abstain on Burford abstention grounds.
c. Laches
The doctrine of laches often could bar relief in a case where a party waited six years or
more to seek court intervention, but, largely because the motions directly concern the effect of
the Court’s prior discharge and injunction orders, laches does not prevent this Court from
deciding the Discharge Motion.
“The doctrine of laches protects defendants against unreasonable, prejudicial delay in
commencing suit.” Zuckerman v. Metro. Museum of Art, 928 F.3d 186, 193 (2d Cir. 2019)
(internal citations omitted). “A party asserting a laches defense must show that the plaintiff has

inexcusably slept on its rights so as to make a decree against the defendant unfair. Laches . . .
requires a showing by the defendant that it has been prejudiced by the plaintiff’s unreasonable
delay in bringing the action.” Id.
The Louisiana Plaintiffs cannot overcome the reality that the bankruptcy discharge under
Section 524 of the Bankruptcy Code is not an affirmative defense that can be waived, such that
equitable defenses can prevent its assertion. See, e.g., In re Johns-Manville Corp., 552 B.R. 221,
252 (Bankr. S.D.N.Y. 2016); Meadows v. Hagler (In re Meadows), 428 B.R. 894, 906–07 (N.D.
Ga. 2010) (“Both §§ 524(a)(1) and (a)(2) expressly state, however, that their protections with
regard to a discharged debt apply ‘whether or not discharge of such debt is waived.’ . . . [T]he
Debtor’s failure to assert his bankruptcy discharge at an earlier time did not waive its protections
and does not estop him from asserting it in this proceeding.”). Judge Drain reached the same
conclusion in this very case when he held “that neither waiver nor laches apply here given
primarily the fact that under the bankruptcy code, the discharge which in a Chapter 11 case
benefits not only the debtor but the debtor’s creditors and in a solvent case the debtor’s

shareholders cannot be waived by conduct or even an agreement without proper approval under
Section 524 of the bankruptcy code.” Transcript of May 28, 2010 Telephone Hearing at 11,
Kling Realty Co. v. Texaco, Inc. (In re Texaco, Inc.), No. 87-20142 (2010).
As stated above, although not controlling here, the timeliness factor weighs in favor of
the Louisiana Plaintiffs. See supra at III. A. 3. It has been clear throughout these cases that the
Louisiana Plaintiffs seek remedies for what they assert is massive, cumulative environmental
degradation spanning decades. Nevertheless, this Court’s deciding the Discharge Motion will
advance all parties’ and relevant courts’ interests by efficiently allowing this Court to interpret its
own order in the context of the twenty-two currently pending state court lawsuits. Further, the

timing of this Decision will not derail the currently pending March 2025 trial in Rozel.
As such, laches does not prevent the Court from deciding the Discharge Motion.
B. Discharge Motion
1. Legal Standard
Except as otherwise provided in the debtor’s plan or the order confirming the plan,
Bankruptcy Code Section 1141(d)(1) provides for the discharge of all claims against the debtor
that arose pre-confirmation whether or not a proof of claim was filed. 11 U.S.C. § 1141(d)(1).
Section 524(a)(2) of the Bankruptcy Code provides that a discharge “operates as an injunction
against the commencement or continuation of an action . . . [to] recover . . . any such debt,” and
the Confirmation Order contained an express injunction disallowing the pursuit of recovery for
pre-confirmation claims outside of Texaco’s bankruptcy case. See 11 U.S.C. 524(a)(2); see also
Confirmation Order, TA at 349–50. The Bankruptcy Code, in addition to the language in the
Texaco Plan in this case, defines a “claim” as follows: “(A) a right to payment (including,
without limitation, a guarantee), whether or not such right is reduced to judgment, liquidated,
fixed or contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or

unsecured; or (B) a right to an equitable remedy for breach of performance if such breach gives
rise to a right to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured, or unsecured.”
11 U.S.C. § 101(5); see Plan, TA at 15–16 (same). It appears all but certain in the absence of
compelling contrary arguments that the Louisiana Lawsuits, to the extent they assert liability for
pre-confirmation conduct, constitute “claims” under the Bankruptcy Code and Plan. See
Discharge Motion ¶ 49–52; see generally Discharge Opp. Thus, the controlling question here is
whether the “claims” asserted in the Louisiana Lawsuits should be classified, and interpreted, as
Class 3-B claims.

“A confirmed plan of reorganization is in effect a contract between the parties and the
terms of the plan describe their rights and obligations.” See Ernst & Young LLP v. Baker O’Neal
Holdings, 304 F.3d 753, 755 (7th Cir. 2002) (citing In re Chicago, Milwaukee, St. Paul and
Pacific R. R., Co., 891 F.2d 159, 161 (7th Cir. 1989)). As a result, bankruptcy courts “follow[]
principles of contract interpretation to interpret a confirmed plan of reorganization.” IQMax, Inc.
v. Fusion PM Holdings, Inc., 2023 WL 2290815, at *1 (2d Cir. Mar. 1, 2023); see In re AMR
Corp. et al., 562 B.R. 20, 28 (Bankr. S.D.N.Y. 2016) (finding that courts apply principles of
contract law when interpreting a confirmed plan).
In this case, “the rights and obligations arising under [the] Plan shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York, without giving
effect to the principles of conflicts law thereof.” Plan, TA at 65. “It is axiomatic under New York
law . . . that the fundamental objective of contract interpretation is to give effect to the expressed
intentions of the parties.” Attestor Cap. LLP v. Lehman Bros. Holdings (In re Lehman Bros.

Holdings), 2019 U.S. Dist. LEXIS 139185, at *26 (S.D.N.Y. Aug. 16, 2019) (quoting Lockheed
Martin Corp. v. Retail Holdings, N.V., 639 F.3d 63, 69 (2d Cir. 2011) (internal quotation marks
omitted)). “[S]pecific clauses of a contract are to be read consistently with the overall manifest
purpose of the parties’ agreement. Contracts are also to be interpreted to avoid inconsistencies
and to give meaning to all of its terms.” In re AMR Corp., 562 B.R. at 29 (quoting Barrow v.
Lawrence United Corp., 146 A.D.2d 15, 538 N.Y.S.2d 363, 365 (App. Div. 1989)). “For
purposes of interpreting a confirmed chapter 11 plan, . . . [t]he Court-approved disclosure
statement . . . may be considered conjunctively with the plan, at least where the disclosure
statement may be relied on for purposes of claim and issue preclusion.” Solus Alt. Asset Mgmt. v.

Delphi Auto (In re DPH Holdings Corp.), 553 B.R. 20, 26 (Bankr. S.D.N.Y. 2016) (citing In re
WorldCom, Inc., 352 B.R. 369, 377 (Bankr. S.D.N.Y. 2006)).
In a dispute over the meaning of a plan provision, “the threshold question is whether the
contract is ambiguous.” Id. at 27 (citing Lockheed Martin Corp. v. Retail Holdings, N.V., 639
F.3d at 69). Under New York law, “a contract that is complete, clear, and unambiguous on its
face must be enforced according to the plain meaning of its terms.” Utica Mut. Ins. v. Fireman’s
Fund Ins., 957 F.3d 337, 344 (2d Cir. 2020) (quoting Glob. Reinsurance Corp. of Am. v. Century
Indem. Co., 91 N.E.3d 1186, 1193 (N.Y. 2017)). Moreover, “[w]hen the contract’s language is
clear and unambiguous, ‘courts should not rewrite the term under the guise of interpretation’ nor
‘redraft a contract to accord with its instinct for the dispensation of equity upon the facts of a
given case.’” In re Wonderwork, Inc., 2021 Bankr. LEXIS 3157, at *13 (Bankr. S.D.N.Y. Nov.
16, 2021) (quoting In re Dynegy Inc., 486 B.R. 585, 590 (Bankr. S.D.N.Y 2013)). “A contract is
unambiguous where the contract’s terms have a definite and precise meaning, as to which there
is no reasonable basis for a difference of opinion.” Barclays Capital Inc. v. Giddens (In re

Lehman Bros. Holdings), 478 B.R. 570, 586 (S.D.N.Y. 2012), aff’d sub nom. In re Lehman Bros.
Holdings, 761 F.3d 303 (2d Cir. 2014), and aff’d sub nom. In re Lehman Bros. Holdings, 590 F.
App’x 92 (2d Cir. 2015) (internal quotation marks and citations omitted). However, where
“reasonable minds could differ about the meaning of contractual language, such language is
ambiguous, . . . and the court must turn to extrinsic evidence to determine the parties’ intent.” In
re Lehman Bros. Holdings, 2019 U.S. Dist. LEXIS 139185, at *26–27 (citing In re Motors
Liquidation Co., 500 B.R. 333, 340 (S.D.N.Y. 2013), aff’d, 578 F. App’x 43 (2d Cir. 2014)).
When faced with ambiguity, courts may use various canons and principles of
construction and parol evidence to ascertain the meaning of the text. See Chai v. Comm’r, 851

F.3d 190, 217 (2d Cir. 2017) (“[I]f the meaning of the statute is ambiguous, [the court] may
resort to canons of statutory interpretation to help resolve the ambiguity.”); In re DPH Holdings
Corp., 553 B.R. at 32 n. 20 (under New York law, “canons of contract interpretation . . . are only
non-dispositive aids to interpretation and should not be used to exclude too readily, as if ignoring
guests at a party, the legitimate possible meaning of an agreement”); New York Univ. v. Factory
Mut. Ins., 374 F. Supp. 3d 315, 323 (S.D.N.Y. 2019), aff'd, No. 20-1093-CV, 2021 WL 3136078
(2d Cir. July 26, 2021), and aff'd, No. 20-1093-CV, 2021 WL 3136078 (2d Cir. July 26, 2021)
(“New York law recognizes the expressio unius canon of contract construction”); see also In re
Delta Air Lines, Inc., 381 B.R. 57, 81 (Bankr. S.D.N.Y. 2008) (finding that parol evidence may
be considered only if an agreement is ambiguous).
At all times, a court must “construe the contract ‘in a manner that accords the words their
fair and reasonable meaning and achieves a practical interpretation of the expressions of the
parties. Put otherwise, a contract should not be interpreted to produce a result that is absurd,

commercially unreasonable or contrary to the reasonable expectations of the parties.’” In re DPH
Holdings Corp., 553 B.R. at 27 (quoting Greenwich Capital Fin. Prods., Inc. v. Negrin, 74
A.D.3d 413, 415 (N.Y. App. Div. 1st Dep’t 2010) (internal quotations marks and citations
omitted)); see also Nat’l Union Fire Ins. v. Monarch Payroll, Inc., 2016 U.S. Dist. LEXIS
19077, at *30–31 (S.D.N.Y. Feb. 17, 2016) (accord). “The meaning of particular language . . .
should be examined in light of the business purposes sought to be achieved by the parties and the
plain meaning of the words chosen by them to effect those purposes.” SR Int’l Bus. Ins. v. Allianz
Ins., 343 Fed. App’x 629, 632 (2d Cir. 2009) (internal quotation and citation omitted);
Mastrovincenzo v. New York, 435 F.3d 78, 104 (2d Cir. 2008) (the “cardinal principle for

construction and interpretation of . . . all contracts . . . is that the intentions of the parties should
control. Unless otherwise indicated, words should be given the meanings ordinarily ascribed to
them and absurd results should be avoided”) (alterations in original); see also Massachusetts
Mut. Life Ins. v. Thorpe, 260 A.D.2d 706, 709 (1999) (“The most fundamental canon of contract
interpretation, taking precedence over all others, is that primary attention be given to the purpose
of the parties in making the contract.”).
2. Parties’ Contentions
a. Reorganized Texaco’s Discharge Motion
Reorganized Texaco argues that the Louisiana Lawsuits unlawfully assert pre-
confirmation claims that were discharged in Texaco’s bankruptcy case. See, e.g., Discharge
Motion ¶ 48. The Debtor maintains that the Louisiana Plaintiffs’ asserted requests for relief in
the various lawsuits are for an award of money damages and plainly qualify as “claims” under
the Bankruptcy Code’s broad definition, and thus are “claims” whose treatment is determined by
the Plan, Confirmation Order, and Bar Date Order. Id. ¶ 52. The Debtor further contends that
under the “relationship test” used by courts within the Second Circuit, the Louisiana Plaintiffs

had a pre-confirmation relationship with the Debtor through Debtor’s oil and gas activities in the
parishes such that the SLCRMA claims in all twenty-two lawsuits arose pre-confirmation, and
are subject to the Bar Date Order and the Plan’s discharge. Id. ¶ 53–57. Reorganized Texaco
argues that these pre-confirmation SLCRMA claims are Class 6-A unsecured claims under the
Plan, and thus were barred by the Bar Date Order, and discharged and enjoined by the Plan and
Confirmation Order. Id. ¶ 58–61.
Reorganized Texaco maintains that the Louisiana Plaintiffs’ claims do not qualify as
Class 3-B environmental claims, which were not discharged and survived the consummation of
the Plan as if the Texaco bankruptcy cases had not commenced. Id. ¶ 62–65. The Debtor

contends that the Plan language defining Class 3-B should be interpreted as only inclusive of (a)
claims under the 13 Federal Environmental Statutes and (b) claims under state laws that are
“analogs” of the 13 Federal Environmental Statutes. Id. ¶¶ 66, 68. Specifically, Reorganized
Texaco maintains that three canons of interpretation—ejusdem generis, noscitur a sociis, and the
rule against adopting constructions that make contractual language superfluous—compel this
reading and result. Id. ¶ 68–75. Debtor maintains that its interpretation recognizes the distinct
purpose of each “category” of Class 3-B claims, with the so-called catchall provision simply
capturing state law analogs of the 13 Federal Environmental Statutes while avoiding the need to
list every comparable law adopted by all 50 states. Id. ¶ 76.
In so contending, Reorganized Texaco relies on Cnty. of San Mateo v. Peabody Energy
Corp. (In re Peabody Energy Corp.), 958 F.3d 717, 721–23 (8th Cir. 2020), which construed
another plan of reorganization that carved out claims under “Environmental Law” from
discharge. Id. ¶ 74–75. In that case, the Eighth Circuit held that that the catchall in the plan at
issue was informed by the list of ten federal statutes that preceded it and was limited to state

statutes with an analogous scope, and Reorganized Texaco argues that this Court should find the
same here. Id.
The last link in Debtor’s analytical chain is its contention that SLCRMA is not an analog
of any of the 13 Federal Environmental Statutes, and that Louisiana has adopted other statutes to
implement and enforce all or some of the 13 Federal Environmental Statutes, while SLCRMA
was not adopted for that purpose. Id. ¶ 77–87. Rather, Debtor maintains that SLCRMA was
adopted as a state analog of the federal CZMA, and CZMA is not one of the 13 Federal
Environmental Statutes. Id. ¶ 83–87. Reorganized Texaco further argues that SLCRMA is not an
“environmental law” because “SLCRMA’s focus lies elsewhere” with the asserted broad intent

“to encourage multiple uses of resources and adequate economic growth while minimizing
adverse effects of one resource use upon another without imposing undue restrictions on any
user.” Id. ¶ 38 (citing A Coastal User’s Guide to the Louisiana Resources Program II-2, La.
Dep’t Nat. Res. (2015), https://data.dnr.la.gov/LCP/LCPHANDBOOK/FinalUsersGuide.pdf, TA
at 896). To further support its position that SLCRMA is not an environmental law, Debtor notes
that LDNR’s Office of Costal Management administers SLCRMA while the Louisiana Office of
Conservation handles many other aspects of mineral extraction permitting and the Louisiana
Department of Environmental Quality both enforces and issues permits under Louisiana’s Clean
Water Act and Clean Air Act analogs. Id. ¶ 39.
b. Louisiana Plaintiffs’ Opposition to the Discharge Motion
In opposition,5 the Louisiana Plaintiffs argue that their claims were not discharged
because they are covered by language describing Class 3-B of the Plan. Discharge Opp., at 16–
17. They further observe that no language in the Plan, the Disclosure Statement and the Notice of
Confirmation limits the scope of the discharge-exempted environmental claims of state or local

governmental units to only the 13 Federal Environmental Statutes and any state analogs thereof.
Id., at 16–19.
In contending that their SLCRMA claims are environmental and thus exempt from
Texaco’s discharge and injunction, the Louisiana Plaintiffs cite the Second Circuit’s
characterization of the CZMA as giving “states a key role in environmental regulation by
allowing them to develop their own coastal zone management programs, which are subject to
federal approval by the National Oceanic and Atmospheric Administration (‘NOAA’) in the
Department of Commerce.” Id., at 17 (citing Town of Southold v. Wheeler, 48 F.4th 67, 71–72
(2d Cir. 2022), cert. denied sub nom. Town of Southold, New York v. Rosado, 143 S. Ct. 1755

(2023)). The Louisiana Plaintiffs also identify specific references to environmental law or
purposes within SLCRMA and the Coastal Use Guidelines. Id., at 17 n. 32.
According to the Louisiana Plaintiffs, the Plan’s definition of Class 3-B unambiguously
applies broadly to include environmental claims of state and local government units arising
under their own statutes, rules, and regulations, and is not limited to state analogs of the 13
Federal Environmental Statutes. Id., at 17–18. They further argue that Reorganized Texaco
misapplies the canon ejusdem generis, and that the list of thirteen federal environmental statutes

5 This Decision’s discussion of parties’ contentions relating to the Discharge Motion, Discharge Opp., and
Discharge Reply omits arguments that were addressed above in the Merits of the Reopen Motion section, see supra
at III. A. 3., generally relating to Texaco’s delay in filing the Reopen Motion, permissive abstention, Buford
abstention, and laches.
should inform the “class” or general subject matter of state laws included in the catchall, i.e., the
class includes state or local laws that provide environmental remedies rather than being confined
to the “analogs” of the 13 Federal Environmental Statutes. Id., at 17–19. Second, the Louisiana
Plaintiffs contend that the language in the Bar Date Notice stating that any governmental unit
need not file a proof of claim “with respect to a claim relating to the enforcement of

environmental protection laws and regulations in accordance with the following or similar
statutes” clearly implicates federal statutes that are “similar” to the 13 Federal Environmental
Statutes as well as broadly “similar” state statutes. Id., at 19. In essence, they criticize Debtor’s
argument as requiring a nonsensical conclusion “that [the] word ‘other’ does not actually mean
other.” Id., at 21.
The Louisiana Plaintiffs also support their contention that SLCRMA is covered by the
Plan’s Class 3-B with a detailed discussion of the federal CZMA, which Louisiana Plaintiffs
argue confers substantial environmental regulatory and enforcement to states. Id., at 20 (citing S.
Rep. No. 92-753, at 1 (1972), reprinted in 1972 U.S.C.C.A.N. 4776). Louisiana Plaintiffs note

that while CZMA is not listed as one of the 13 Federal Environmental Statutes, the “notion that
CZMA and SLCRMA operate in a vacuum” is unsupported as even some of the 13 Federal
Environmental Statutes require compliance with the CZMA. Id.
Finally, the Louisiana Plaintiffs maintain that In re Peabody Energy Corporation is
inapposite for two main reasons. Id. First, the environmental law carveout in Peabody was
worded differently such that the language was not analogous to Texaco’s Plan. Id. And, second,
the municipalities in Peabody (unlike the Louisiana Plaintiffs) were also asserting common-law
claims as “state and local equivalents” of the listed federal statutes, but those were clearly tort
claims that did not benefit from the plan’s preservation of claims under environmental statutes.
Id.
c. Reorganized Texaco’s Reply
In reply, Reorganized Texaco correctly notes that there is little if any dispute that the
claims in the Louisiana Lawsuits based on the Debtor’s pre-confirmation conduct constitute

“claims” under the Bankruptcy Code. Discharge Reply ¶ 2. The Debtor reiterates its argument
that Class 3-B is limited to claims under the 13 Federal Environmental Statutes and state analogs
thereof because the list of the 13 Federal Environmental Statutes does not include the CZMA and
because, in Debtor’s view, the second clause of the definition of Class 3-B in the Plan is a
“catchall” that must limited in scope to the examples that come before it, namely the 13 Federal
Environmental Statutes. Id. ¶¶ 4, 9–12. The Debtor further maintains that it is irrelevant whether
Louisiana Plaintiffs claim that CZMA is “more” environmental than certain of the 13 Federal
Environmental Statutes based on Debtor’s theory that the Plan’s definition of Class 3-B does not
encompass claims that arise under all purported environmental statutes. Id. ¶ 17. Debtor further
objects that the Louisiana Plaintiffs’ reading wrongly equates “other” with “any and all.” Id. ¶

18.
Lastly, the Debtor argues that CZMA is neither listed among nor similar to the 13 Federal
Environmental Statutes for a variety of reasons discussed below. Id. ¶ 19–23.
Finally as to the parties’ contentions, it also bears mention that when a contract is
ambiguous, the Court can consider parol evidence of the parties’ understanding and intent at the
time of drafting. Cf. In re DPH Holdings Corp., 553 B.R. at 35–36 (concluding that the proper
course on summary judgment motions on the interpretation of ambiguous plan provisions was to
develop a factual record using parol evidence). However, neither the Debtor nor the Louisiana
Plaintiffs identified parol evidence beyond the case’s formal record despite inquiry by the Court
during oral argument. There accordingly was no need for the Court to conduct an evidentiary
hearing on the Discharge Motion.
3. Merits of the Discharge Motion

It is undisputed that claims that fall within “Class 3-B” under the Plan are excluded from
the Plan’s and Confirmation Order’s discharge and injunction provisions. The parties’ dispute
therefore boils down to determining the meaning and applicability of the Plan’s definition of
“Class 3-B” claims. The confirmed Plan describes that class of claims as follows:
Unsecured Claims of the United States of America and other state and local
governmental units arising under the statutes set forth on Exhibit “6” attached
hereto and incorporated herein by reference and under other environmental
protection legislation, rules or regulations enacted, adopted or promulgated by
states or subdivisions thereof.

Plan, TA at 35–36. The Court denies the Discharge Motion because the Louisiana Lawsuits
present environmental claims that fall within the Plan’s definition of Class 3-B claims. The
reasons for this conclusion are detailed below, but, by way of summary, the Louisiana Plaintiffs
are local and state governmental units that are asserting claims for monetary and possibly other
relief based on alleged violations of a Louisiana statute and associated regulations that the
Louisiana Plaintiffs contend impose liability and provide remedies for pre-bankruptcy Texaco’s
alleged causation of widespread environmental contamination and land loss through decades of
activity in Louisiana. Try as Reorganized Texaco might to show otherwise, these claims fall
squarely within the Class 3-B definition of environmental claims that are not discharged or
enjoined under the Plan. This is consistent with the Plan’s purpose and objectives: the Plan and
associated documents were urgently and expressly aimed at resolving the enterprise-threatening
Pennzoil judgment. At the time of confirmation and throughout the case, the Debtor made clear
that its environmental liability exposures and obligations were beyond the scope and purpose of
its bankruptcy case and would be left unaffected by the bankruptcy.
Meanwhile, Reorganized Texaco’s contrary reading of the Plan is unduly cramped and
unpersuasive—in essence a misplaced insistence that a handful of judicially recognized canons
of interpretation are the sole available tools for reading the Plan and, further and inaccurately,

that those canons dictate a contrary result.
a. The Plain Language and Unambiguous Meaning of the Plan’s
Class 3-B Definition Applies to the Louisiana Plaintiffs’
Claims
Before turning to any other means of interpreting the Plan’s language, the Court first
considers “whether the contract is ambiguous,” In re DPH Holdings Corp., 553 B.R. at 27,
because “a contract that is complete, clear, and unambiguous on its face must be enforced
according to the plain meaning of its terms.” Utica Mut. Ins. Co., 937 F.3d at 344. For this
standard to be met, the contract’s terms must have a “definite and precise meaning” as to which
“there is no reasonable basis for a difference of opinion.” Barclays Capital Inc., 478 B.R. at 586.
The Court concludes that the Louisiana Plaintiffs’ claims fall within the unambiguous meaning
of the Plan’s Class 3-B definition, and the Court’s analysis could stop there, although, as
discussed below, that conclusion finds further reinforcement if one looks beyond the express, on-
point Plan language.
As a threshold matter, and as appears uncontested, the Louisiana Plaintiffs are
governmental units organized under the laws of the State of Louisiana such that they are among
the state and local governmental parties covered by the Plan’s Class 3-B. See Plan, TA at 35–36.
The controlling question thus is whether their asserted claims in the Louisiana Lawsuits
arise “under other environmental protection legislation, rules or regulations enacted, adopted or
promulgated by states or subdivisions thereof.” Plan, TA at 35–36. The answer to this question
requires consideration of the law under which their claims are brought, an analysis that is further
informed by the nature of the claims and remedies sought in the Louisiana Lawsuits, all of which
are brought exclusively pursuant to SLCRMA and related state regulations.
SLCRMA, the governing statute, is not exclusively devoted to environmental protection
or remediation, but encompasses environmental regulation and harm avoidance, and provides for

court imposition of remediation requirements and remedies such as fines and penalties. As stated
in the Background section, SLCRMA established a Louisiana state regulatory regime enacted
pursuant to the federal Coastal Zone Management Act, which authorized states to develop
coastal management programs. See supra at I. B.; 16 U.S.C. §§ 1451, 1452. SLCRMA requires
individuals and businesses wishing to conduct “any use or activity within the [Louisiana] coastal
zone” to obtain a permit, with the LDNR through the Office of Coastal Management, which, in
deciding whether to grant a permit, balances the anticipated benefits of proposed uses and
economic development in the area with the need to protect and restore the coastal region. See La.
Rev. Stat. §§ 49:214.30, 49:214.26, 49:214.22. The Second Circuit has recognized the

environmental aspects of the CZMA regime, characterizing the CZMA as “giv[ing] states a key
role in environmental regulation by allowing them to develop their own coastal zone
management programs.” Town of Southold v. Wheeler, 48 F.4th 67, 71–72 (2d Cir. 2022) (citing
16 U.S.C. § 1455(d)). Subsection (36) of SLCRMA provides for environment-focused
enforcement of the statute, including courts’ ability to impose civil liability, order the payment of
restoration costs, and require actual restoration of disturbed areas. See La. Rev. Stat. §
49:214.36(E).
Although Reorganized Texaco is correct that SLCRMA also covers things like land use
and economic development, those features of the law do not negate or render irrelevant the
environmentally focused aspects of the law. SLCRMA explicitly states its statutory purpose and
requirements as mandating, in conjunction with the weighing of benefits of proposed activities,
the simultaneous consideration of environmental protection and maintenance. See La. Rev. Stat.
§ 49:214.22(5). Further, Louisiana’s Coastal Use Guidelines issued under SLCRMA concerning
oil and gas activities require that “[d]rilling and production sites shall be prepared, constructed,

and operated using the best practical techniques to prevent the release of pollutants or toxic
substances into the environment.” La. Admin. Code tit. 43, pt. I, §§ 719(D), (E). Throughout the
statute, there are many references to environmental considerations. See generally La. Rev. Stat.
§§ 49:214.21 et seq. The statute cannot be read as being unconcerned with environmental
protection and remediation merely because it also serves purposes of land use management and
facilitation of appropriate economic or other activity. Cf., e.g., Executive Order 13563, 76 Fed.
Reg. 3821 (Jan. 21, 2011) (requiring federal agencies (including the EPA) to quantify anticipated
benefits and costs of proposed rulemakings and to reduce the burden of regulation; “[o]ur
regulatory system must protect public health, welfare, safety, and our environment while

promoting economic growth, innovation, competitiveness, and job creation”; agencies are to
select, “in choosing among alternative regulatory approaches, those approaches that maximize
net benefits (including potential economic, environmental, public health and safety, and other
advantages)”).
In fact, one of Reorganized Texaco’s asserted examples of how “SLCRMA’s focus lies
elsewhere” cuts in favor of the Louisiana Plaintiffs. Reorganized Texaco notes that SLCRMA
incorporates requirements from separate environmental statutes such as the Clean Air Act and
further objects that the obligations and monetary grants provided under CZMA are inapplicable
in states that do not adopt an appropriate coastal management program. See Discharge Motion ¶
34–38; Discharge Reply ¶ 19–23. But the fact that state-enacted laws and plans under the CZMA
umbrella incorporate environmental protection laws shows that those state regimes, like
SLCRMA, do serve environmental purposes. Nor is SLCRMA made non-environmental by the
fact that CZMA authorizes federal grants to support participating states’ implementation of a
coastal management program. Rather, the provision of federal funds incentivizes states to adopt

an approved program to maintain the state’s coastal zone and enforce the requirements set forth
in CZMA, and this process includes consideration and appropriate protections for the
environment.
Further, although Louisiana Plaintiffs did not develop the argument, SLCRMA includes
environmental requirements that are similar to at least one of the enumerated 13 Federal
Environmental Statutes, namely, the Comprehensive Environmental Response, Compensation
and Liability Act (“CERCLA”), 42 U.S.C. §§ 9601 et seq. CERCLA was enacted in 1980, and
authorized the Hazardous Substance Superfund Trust Fund to fund remediation of sites for which
there are no financially viable parties who can satisfy the liability, with the trust funded under the

Internal Revenue Code by a tax scheme upon crude oil, imported petroleum products, and
domestic chemical feedstocks, among others. See 26 U.S.C. §§ 4611, 4661. CERCLA—a
quintessential federal environmental statute—includes remedial provisions much like
SLCRMA’s, including authorizing the EPA to issue administrative orders or pursue judicial
orders to require responsible parties to perform cleanup of areas impacted by the release of
contaminants and seek recovery for cleanup costs, among others. See 42 U.S.C. §§ 9606(a),
9607(a). CERCLA also includes “natural resource damage” provisions that, much like the
Louisiana Plaintiffs’ land restoration claims under SLCRMA, can lead to a requirement to fund
or carry out restoration efforts to alleviate natural resource damages associated with a
defendant’s activities. See generally 42 U.S.C. § 9607(f); 43 C.F.R. pt. 300.
Thus, the environmental nature of SLCRMA and its regulations is unambiguous, but this
reading also is borne out by consideration of the Louisiana Lawsuits, which are based entirely on
SLCRMA and regulations under it, and which allege and seek relief for “environmental” harms

allegedly caused by Texaco, both before and after its bankruptcy. The “environmental” harms
asserted by Louisiana Plaintiffs include damages caused by Debtor’s oil and gas activities in the
form of land loss and contamination. Discharge Motion ¶ 41. The relief requested—again, all
pursuant to and consistent with SLCRMA—includes payment of “costs necessary to clear,
revegetate, detoxify and otherwise restore” the areas at issue, and actual restoration of the coastal
zone. Rozel Petition for Damages, TA at 414. These are quintessentially environmental claims,
brought under SLCRMA. It is hard to see how a law with features like SLCRMA’s that supports
claims like those of the Louisiana Plaintiffs here could be anything other than state-promulgated
environmental legislation and/or regulations. Of course, whether the Louisiana Plaintiffs’ claims

are legally sufficient and proven at trial remains to be determined by the Louisiana courts, but—
with the claims having survived more than a decade of pretrial litigation and having advanced to
the cusp of trial—one cannot help but conclude that the governing statutory regime is an
“environmental” law that permits monetary damage and remediation claims in response to
alleged environmental harms.
b. The Plan as a Whole, Its Purposes and Evident Intentions, and
the History of Its Development Are Consistent with the
Unambiguous Applicability of the Class 3-B Definition
The unambiguous meaning of the Plan’s Class 3-B definition alone could control, but,
even if it did not, that reading is confirmed by consideration of the Plan as a whole, the purposes
that it serves, and the history of its development and drafting. See Mastrovincenzo, 435 F.3d at
104 (the “cardinal principle for construction and interpretation of . . . all contracts . . . is that the
intentions of the parties should control”); SR Int’l Bus. Ins. v. Allianz Ins., 343 Fed. App’x 629,
632 (2d Cir. 2009) (the “meaning of particular language . . . should be examined in light of the
business purposes sought to be achieved by the parties and the plain meaning of the words
chosen by them to effect those purposes”) (internal quotation and citation omitted). As this

Court has recognized, “specific clauses of a contract are to be read consistently with the overall
manifest purpose of the parties’ agreement.” In re AMR Corp., 562 B.R. 20, 29 (Bankr. S.D.N.Y.
2016) (quoting Barrow v. Lawrence United Corp., 538 N.Y.S.2d 363, 365 (App. Div. 1989)).
First, the Plan, standing alone, clearly evinces the intention to reserve for another day
environmental claims, without consideration of or exception as to any state’s or locality’s
possible claims or regulatory concerns arising from Texaco’s long history of pre-bankruptcy
energy production. Nothing in the Plan says or suggests that any type of state or local
governmental environmental claims are not preserved, nothing in the Plan details or provides for
any particular treatment of any type of state or local governmental entity environmental claims,

and nothing in the Plan expressly limits the open-ended wording of Class 3-B as to
environmental claims of states and localities.
This is in keeping with the origins, history, and purpose of Texaco’s bankruptcy case.
Texaco itself described its bankruptcy’s overarching purpose and context as “provid[ing] Texaco
with additional time to seek a reasonable settlement of the [Pennzoil] controversy,” which
otherwise threatened to cripple the company, and after that settlement the company sought a
swift exit from bankruptcy. Disclosure Statement, TA at 145; see also In re Texaco Inc., 254
B.R. 536, 541–42 (Bankr. S.D.N.Y. 2000); see also generally Disclosure Statement, TA at 141–
45 (“In Texaco’s opinion, this was the only viable means by which Texaco could pursue its
appeal of the Pennzoil judgment” and prevent Pennzoil from “seiz[ing] and sell[ing] Texaco’s
assets” pending appeal.). Meanwhile, it was important for Pre-Plan Texaco not to get bogged
down in protracted bankruptcy proceedings, so that it consciously chose to avoid the morass of
trying to resolve its many environmental issues: as it said in its Disclosure Statement, Texaco
excluded the EPA’s and other agencies’ environmental claims so as to “avoid delaying these

[bankruptcy cases] to resolve any potential dispute over [these] issues.” Disclosure Statement,
TA at 160. Like many energy companies, Pre-Plan Texaco was subject to longstanding
regulatory inquiry and environmental liabilities, as acknowledged in the Disclosure Statement.
Id. (“Agencies of the United States, including the . . . [EPA], presently have certain lawsuits
pending against Texaco under federal environmental laws.”). Given that Pre-Plan Texaco was
“unable to estimate with any degree of certainty the amount of liability, if any, in respect of
‘Environmental Claims,’” Reorganized Texaco created Class 3-B and allowed environmental
law claims arising thereunder to survive the bankruptcy unaffected by the discharge. Id. In fact,
Pre-Plan Texaco explicitly stated that “following confirmation of the Plan, other environmental

actions or proceedings arguably arising from Texaco’s pre-petition acts may be asserted against
Texaco.” Id.
The Disclosure Statement, a Court-approved document that Texaco used to solicit
acceptances of the Plan which all creditors and parties in interest were urged to read “with care,”
contains many other passages to the same effect. See Disclosure Statement Order, TA at 132. It
described and defined Class 3-B as follows: “[t]he Plan does not impair the Claims of the United
States Department of Energy (the ‘DOE’) and the claims of any governmental unit arising
under any environmental legislation (the ‘Environmental Claims’).” Disclosure Statement, TA
at 140 (emphasis added). The Disclosure Statement further stated that “[t]he Environmental
Claims relate to any Claims which have been or may be asserted by any governmental unit
arising under various federal or similar statutes regarding environmental protection and related
legislation, rules and regulations.” Id., TA 160 (emphasis added). Again, these statements are
unaccompanied by any suggestion that the scope of the Class 3-B carveout was limited.
Similarly, the Bar Date Order and Bar Date Notice also contained broad language describing

Class 3-B: “enforcement of environmental protection laws and regulations in accordance with
the following or similar statutes.” Bar Date Order, TA at 4–5; Bar Date Notice, TA at 9–10
(emphasis added). This definition too appears elastic and unqualified, and nowhere suggests that
any governmental unit’s environmental claim would be subject to the Bar Date or, by extension,
to the Plan’s discharge or injunction.
Further, like almost all plans of reorganization in voluntary Chapter 11 cases, the Plan
was developed and proposed by the Debtor, albeit doubtless with input from other
constituencies. If the Debtor wanted a less open-ended preservation of state environmental
claims, it easily could have used more specific wording. To the extent the open-ended wording

concerning the types of state claims excepted from discharge created ambiguity, the Debtor who
drafted the provision should not benefit from a new, restrictive reading of its own elastic
wording. Cf. McCarthy v. Am. Int'l Grp., 283 F.3d 121, 124 (2d Cir. 2002) (“New York follows
the well established contra proferentem principle which requires that equivocal contract
provisions are generally to be construed against the drafter.”) (internal citations omitted).
In the face of this overwhelming evidence that Texaco’s bankruptcy aimed at not
canvassing, detailing, or resolving what the company understood to be wide-ranging
environmental liability exposures, and instead prioritized surgically resolving its Pennzoil
dispute and swiftly exiting bankruptcy, Reorganized Texaco’s Discharge Motion and the reading
it now advances is contrary to the realities of the bankruptcy case that spawned the Class 3-B
definition. Their proposed reading cannot be squared with the requirement that “specific clauses
of a contract are to be read consistently with the overall manifest purpose of the parties’
agreement.” In re AMR Corp., 562 B.R. at 29; see also SR Int’l Bus. Ins. Co., 343 Fed. App’x at
632.

Thus, although the Plan language defining Class 3-B is unambiguous and does not
require additional reinforcement, the language contained in the supporting documents coupled
with the circumstances and purposes of Texaco’s bankruptcy point in the same direction. In other
words, both the Plan’s literal terms and the Plan’s context and purpose reveal that the Plan’s
discharge and injunction provisions do not bar the Louisiana Lawsuits.
c. Reorganized Texaco’s Arguments Based on Canons of
Construction Are Misplaced
Given the Plan’s unambiguous meaning and clear purposes, Debtor’s resort to various
interpretive canons does not persuade.
Reorganized Texaco relies heavily on the “ejusdem generis” canon of construction,
which it contends limits the state-law claims classified in Class 3-B to claims under the state-law
analogs of the 13 Federal Environmental Statutes. Discharge Motion ¶¶ 70, 72. But this
contention misapplies the ejusdem generis canon, and, even if that were not so, the contention
would not overcome the plain-language and business-purpose considerations described above.
See In re DPH Holdings Corp., 553 B.R. at 32 n. 20 (Under New York law, “canons of contract

interpretation . . . are only non-dispositive aids to interpretation and should not be used to
exclude too readily, as if ignoring guests at a party, the legitimate possible meaning of an
agreement”).
The principle of ejusdem generis posits that “a general or collective term at the end of a
list of specific items is typically controlled and defined by reference to the specific classes . . .
that precede it.” Fischer v. United States, 603 U.S. 480, 487 (2024) (internal quotations and
citations omitted). By way of illustration drawn from Fischer, the court held that the scope of the
“otherwise” provision in 18 U.S.C. § 1512(c)(2) was defined by the specifically enumerated

conduct outlined in § 1512(c)(1) such that the conduct included in the “otherwise” provision was
limited to conduct that impaired the integrity or availability of records, documents, or objects for
use in an official proceeding.6 Id. at 487–89. Thus, a “catchall must be interpreted in light of its
surrounding context and read to embrace only objects similar in nature to the specific examples
preceding it.” Harrington v. Purdue Pharma L.P., 603 U.S. 204, 217 (2024) (internal citations
omitted). In essence, the rule seeks to limit what otherwise could be unbounded elastic readings
of “catchall” provisions appearing at the end of a statutory lists to the general meaning or topic
evidenced by the more specific preceding entries in the statutory list. Cf. id. In the recent Purdue
Pharma decision, for example, the U.S. Supreme Court termed Section 1123(b)(6) a “catchall”

provision and deemed it limited to matters of the general type evidenced in the preceding five
subsections. Id. at 215–19 (interpreting the catchall of “any other appropriate provision not
inconsistent with the applicable provisions of this title” as not so broad as to authorize
nonconsensual non-debtor releases when the preceding five specific examples concerned the
rights and responsibilities of the debtor in relation to creditors).
Reorganized Texaco compares the Plan’s Class 3-B definition to Section 1123(b)(6) of
the Bankruptcy Code, as construed by the Supreme Court in Purdue Pharma. Discharge Motion

6 The relevant provisions in 18 U.S.C. § 1512(c) are as follows: “Whoever corruptly—(1) alters, destroys, mutilates,
or conceals a record, document, or other object, or attempts to do so, with the intent to impair the object’s integrity
or availability for use in an official proceeding; or (2) otherwise obstructs, influences, or impedes any official
proceeding, or attempts to do so, . . . shall be fined . . . or imprisoned not more than 20 years, or both.”
¶ 69. But the two passages materially differ, eliminating any possible force behind Reorganized
Texaco’s argument.
Section 1123(b)(6) is the final entry in a list of numbered statutory subsections of Section
1123(b), identifying permissible characteristics of plans of reorganization. The first five
subsections are relatively targeted and, according to the Supreme Court, debtor-focused, while

the sixth allows “any other appropriate provision not inconsistent with the applicable provisions
of this title.” Id. at 215–19. Although this wording is open-ended, the Supreme Court held that it
does not authorize nonconsensual non-debtor releases because subsection six, as the final entry
in an enumerated list, must be construed in light of and limited by the more specific entries

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10804218. Public record. Not legal advice.