# Motion — Pennzoil Co. v. Texaco Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Motion
- **Published:** January 1, 1987
- **Citation:** 481 U.S. 1

## Text

—

pupreme Court, U.
FILED

6)

MAY $1 1986
No. 85-1798
OSCE SRAMIOL, JR.
CLERK
IN THE

Supreme Court of the United States

October Term, 1985

PENNZOIL COMPANY,

Texaco INC.,

—against-—

Appellant,

Appellee.

On APPEAL FROM THE UNITED STATES
CouRT OF APPEALS FOR THE SECOND CIRCUIT

MOTION TO AFFIRM

CHARLES ALAN WRIGHT
727 East 26th Street
Austin, Texas 78765

WILLIAM F. BAXTER

SHEARMAN & STERLING

4 Embarcadero Center

San Francisco, California 941] 1

Of Counsel.

May 31, 1986

THomaS D. BaRR

Davip Botes*

Max R. SHULMAN

FRANCIS P. BARRON
CRAVATH, SWAINE & MOORE
One Chase Manhattan Plaza
New York, N.Y. 10005
(212) 422-3000

PAUL J. CURRAN*
MILTON J. SCHUBIN
RANDOLPH S. SHERMAN
IRA S. SACKS
KAYE, SCHOLER, FIERMAN,
Hays & HANDLER
425 Park Avenue
New York, N.Y. 10022
(212) 407-8000

Attorneys for Appellee
Texaco Inc.

*Counsel of Record

AV"

TABLE OF CONTENTS

CITI crtcecsccicnriccovesseinicneeseprsccensevese

LIST OF AFFILIATES AND SUBSIDIARIES OF
SEN

STATEMENT OF THE CASE .............0ccscscossessssssesssesscess
EE diaceintctciasnininiecniiennnsininmevenncsantentmunnmenteansseess

A. The Second Circuit’s Due Process Holding
Does Not Merit Plenary Review ....................

B. The Second Circuit’s State Action Holding
Does Not Merit Plenary Review ....................

1. The Second Circuit’s decision is well within

2. The Second Circuit’s decision does not
affect the Anti-Injunction Act...................

3. The Second Circuit’s decision does not
offend the constitutional policies that un-
derlie the state action doctrine..................

C. The Second Circuit’s Younger Holding Does
Not Merit Plenary Review.........................0+++

1. The narrow federal relief at issue does not
implicate a “vital” state interest ...............

2. Texaco lacked a practical remedy in the
ee enisntieccmnedsatinstengrisinn- octane

D. The Second Circuit’s Subject Matter Ju iic-
tion Holding Does Not Merit Plenary Re-

IT iicicieiciccnticnevveincsininnedecemamonnecnmmmennenecces

21

il

TABLE OF AUTHORITIES

Page

CASES:
Archer v. Bill Pearl Drilling Co., 655 S.W.2d 338

(Bae. ABD. TEED ) .nceccccesenssscersnnsenensntesnasisentintinie 16
Davis v. Scherer, 1048. Ct. 3012 (1984)............. 14
Dennis v. Sparks, 449 U.S. 24 (1980).............000 17, 18, 19
Diamond vy. Charles, 54 U.S.L.W. 4418 (US.

Rage BO, CSG) oxicccccesnensessscmnssunisccstmcsinnvsetasstniath 8
District of Columbia Court of Appeals v. Feld-

man, 460 U.S. 462 (1983) ............cccccceeeteeeeeeees 27, 28, 29
Doran v. Salem Inn, Inc., 422 U.S. 922 (1975)... 2
Douglas v. California, 372 U.S. 353 (1963) ........ 10 .
Evitts v. Lucey, 105 S. Ct. 830 (1985) ..............0 7, 10, 11
Glen Oaks Util., Inc. v. City of Houston, 280

fe ks Tb > 8. | 16
Glenn v. Hollums, 73 S.W.2d 1068 (Tex. Civ.

Regt. CGDG) cccnasecsssnsrvesecnictiittteisanniiaaniaiibaania ‘27
Hale v. Harney, 786 F.2d 688 (Sth Cir. 1986)..... 29
Haring v. Prosise, 462 U.S. 306 (1983) ............... 29

Henry v. First National Bank of Clarksdale, 595
F.2d 291 (Sth Cir. 1979), cert. denied, 444
CASE, BOSC BED cccncecctevecisevesnssinctehinibcneniininiin 7,13

Hernandez vy. Finley, 471 F. Supp. 516 (N.D. Ill.
1978), summarily aff'd mem. sub nom. Quern

v. Hernandez, 440 U.S. 951 (1979).................. 26
Huffman v. Pursue, Ltd., 420 U.S. 592 (1975)..... 23,29
Juidice v. Vail, 430 U.S. 327 (1977) ..............0000 21, 23, 24, 29
Kantor v. Herald Publishing Co., 632 S.W.2d ry
G56 (Hem. Age. FETE) ccceesnrsseevsecesnsnsenssnilbtiniinanis 16
Logan v. Zimmerman Brush Co., 455 U.S. 422
ff TEE D <ccocesnscencneiapnsscesnesndiiitiiiteemmiaaiaanianaas 10
Louisville & Nashville R.R. v. Stewart, 241 US.
BO CBBC D ccacctecccncssvmsiscniinsactstiicaaianaana 12
Lugar v. Edmondson Oil Co., 457 U.S. 922
(C DIE D cccecnconssasesdnensetdiinsiitiinssdttieassnaslaiiiniaaaaaannn 15, 16, 17, 18,
19, 20, 21

Mathews v. Eldridge, 424 U.S. 319 (1976) .......... 11

ili

Middlesex County Ethics Committee v. Garden
State Bar Association, 457 U.S. 423 (1982)... 21

Migra v. Warren City School District, 465 U.S.

lit a acahciasladnsinikedéeinastecséocesotocs 29
Mitchum v. Foster, 407 U.S. 225 (1972) ......000000. 22,24
Moore v. Sims, 442 U.S. 415 (1979) wo... 21, 22, 26
Moses H. Cone Memorial Hospital v. Mercury

Construction Corp., 460 U.S. 1 (1983)............. 29
NAACP vy. Claiborne Hardware Co., 458 U.S.

a 13
National Union of Marine Cooks & Stewards v.

Arnold, 348 U.S. 37 (1954) ........ccccccccccesseeeseeees 12
Pace v. McEwen, 604 S.W.2d 231 (Tex. Civ.

arta lial sidanieesutenanncnsscovecssecsece 27

Renger v. Jeffrey, 182 S.W.2d 701 (Tex. 1944)... 16
Shell Petroleum Corp. v. Grays, 62 S.W.2d 113

i ccinractsdinccoseocsescceres 16

Svaboda v. Alexander, 3 S.W.2d 423 (Tex. Com.
EET 27

Thomas v. Kadish, 748 F.2d 276 (Sth Cir.
1984), cert. denied, 105 S. Ct. 3531 (1985)... 29

Williams v. Oklahoma City, 395 U.S. 458
Cas crescscncsencecsonnens 10

Younger v. Harris, 401 U.S. 37 (1971) .......0000.00.. 8, 21, 22, 24,

25, 26, 29

CONSTITUTIONAL PROVISIONS:
U.S. Constitution, Fourteenth Amendment. 1, 10, 18
STATUTES AND RULES:
United States ,

Be WF BEI B Pevcceccncesccescssccensscecscocqeecess 1,14
ois cccccecsceenecnesosescosoes 5
Ee a 15, 19
TE IIE TDD ersSessccasccsscrescescccessecsoosese 1, 20
a 7, 18, 19,
20, 22

TIT a ictincseenncesibscedenncbsonsoscoesceces 5

iv
Page

New York

N.Y. Civ. Prac. Law § 5519(c) .........cccceeeeee 14
Oregon

Or. Rev. Stat. § 19.045 .................0000. secceseeees 14
Texas

Tex. Civ. Prac. and Rem. Code § 65.013 ..... 27

Tex. Prop. Code Ann. § 52.001.................... 2

, AY | eee 27

TE, Sis Ge Bo BP iscatcccnnicsntesetesesecenevieneensnns 1,4, 5,27

» § & 5 fk . l
Virginia

ee Be ID caictescnssecsincesecsscocbcinnten 14

Vv

LIST OF AFFILIATES AND SUBSIDIARIES OF
TEXACO INC. .

The affiliates and subsidiaries of Texaco Inc. listed on its
most recent Form 10-K filed with the Securities and Exchange
Commission are as follows:

Getty Oil Company

Getty Pipeline, Inc.

Riverway Gas Pipeline Company

Texaco Oils Inc.

Texaco Producing Inc.

Texaco Refining and Marketing Inc.

Texaco Trading and Transportation Inc.

The Texas Pipe Line Company

Deutsche Texaco AG

Norsk Texaco Oil A/S

S. A. Texaco Belgium N.V.

S. A. Texaco Petroleum N.V.

Texaco A/S

Texaco Britain Limited

Texaco Denmark Inc.

Texaco Investments ( Netherlands), Inc.

Texaco (Ireland) Limited

Texaco Limited

Texaco North Sea U.K. Company

Texaco Oil Aktiebolag

Texaco Petroleum Maatschappij ( Nederland) B.V.

Refineria Panama S.A.

Refineria Texaco de Honduras, S.A.

Texaco Brasil S.A.-Produtos de Petroleo

Texaco Caribbean Inc.

Texaco Nigeria Limited

Texaco Panama Inc.

Texaco Petroleum Company

Texaco Trinidad, Inc.

Texas Petroleum Company

Texaco Butadiene Company

Texaco Chemical Company

Canadian Reserve Oil and Gas Ltd.

vi

Texaco Canada Inc.

Texaco Canada Resources Ltd.

Getty Marine Corporation

Texaco International Trader Inc.
Texaco Overseas Holdings Inc.
Texaco Overseas Petroleum Company
Texaco Overseas Tankship Ltd. ~

STATEMENT OF THE CASE

Pennzoil has appealed, pursuant to 28 U.S.C. § 1254(2),
from a judgment of the United States Court of Appeals for the
Second Circuit, affirming the grant of a preliminary injunction
against application of certain Texas state security provisions on
the ground that, in “the unique and extraordinary circum-
stances of this case” (A35), application of those provisions
raises serious questions under the Due Process Clause of the
Fourteenth Amendment to the United States Constitution
(A43-44).'1 The State of Texas, whose statutes are at issue,
intervened as a party in the district court pursuant to 28 U.S.C.
§ 2403(b) and separately appealed to the Second Circuit (A4
n.1), but has not appealed to this Court.

Pennzoil’s Jurisdictional Statement largely ignores the fol-
lowing undisputed facts which show why Texaco was compelled
to seek relief in the federal courts and why that narrow relief
was properly granted:

(1) On December 10, 1985, a trial court in Texas entered
a money judgment against Texaco (the “Judgment”) in the
unprecedented amount of $11.12 billion (A6)—over 40 times
larger than the largest private civil judgment ever upheld in any
prior case of any kind.

(2) Under Tex. R. Civ. P. 364(b) and 627, a money
judgment is enforceable by execution 30 days after entry (or, if
a new trial motion is made, 30 days after its denial), unless the
judgment debtor has secured a stay of execution by posting a
supersedeas bond in “at least the amount of the judgment,
interest and costs”. (A8 & n.4, A86) The amount of the bond
is fixed by law; Texas courts have no discretion to vary it. (A9-
10 )2

' Citations in the form “A__” refer to pages in the Appendices attached
to Pennzoil’s Jurisdictional Statement. Citations in the form “JS__—” refer to
pages in Pennzoil’s Jurisdictional Statement.

2 If a supersedeas bond is not posted, a writ of execution is obtained by
ex parte application to the court clerk, the writ is presented by the judgment
creditor to the county sheriff, and the sheriff executes it. (A25-26)

2

(3) Even if a supersedeas bond is posted, Tex. Prop. Code
Ann. §§ 52.001 ef seg. permits a judgment creditor to place
liens upon a judgment debtor’s real property in Texas immedi-
ately upon entry of judgment. (A25-26, A8-9; JS 2) There is
no authority under Texas law for staying attachment of such
judgment liens.%

(4) Under the bond provisions, to obtain a stay of
execution of the Judgment pending appeal, Texaco would have
had to post a bond in excess of $12 billion. (A8) Neither
Texaco nor any other company could have posted such a bond
since “the world-wide surety bond capacity ranges from $1
billion to $1.5 billion under the best possible circumstances”.
(A9)4

(5) Without a supersedeas bond, Pennzoil could have
executed the Judgment, and the “attachmenptof a lien ... on
Texaco’s real property in Texas, valued at $5 billion, would
[have] seal[ed] the company’s fate”, forcing Texaco “into
bankruptcy or liquidation”. (A39-40) As a result, Texaco’s
ability to pursue an effective state court appeal from the
Judgment—an appeal guaranteed by the Texas Constitution
and raising serious questions under both the federal Con-
stitution and state law (A42)—would have been destroyed.
The damage caused to Texaco would have been “immeas-
urable, irrevocable, and irremediable by reversal of the judg-
ment on the merits”. (A44)5

(6) Application of the lien and bond provisions would
also have adversely affected the national economy and national

3 Judgment liens are obtained by ex parte application to the court clerk,
who furnishes an abstract of judgment which the judgment creditor delivers
to county recorders in counties where the judgment debtor’s real property is
located. The county recorders then index and file the abstract, thereby
perfecting the lien. (A25-26)

4 Similarly, although Texaco has a liquidation value in excess of $22
billion (A39), it could not possibly have posted $12 billion in cash or cash
equivalents and “still retain[ed] sufficient liquid assets to operate its busi-
ness” (A9; see also A39); nor, because of the terms of its unsubordinated
indebtedness, could it have possibly borrowed $12 billion by mortgaging or
pledging its assets (A9).

5 See Doran v. Salem Inn, Inc., 422 U.S. 922, 932 (1975) (the possibility
of bankruptcy “[cJertainly ... meets the standard for granting interim relief,
for otherwise a favorable final judgment might well be useless”’).

3

security.6 The extent of the public harm threatened by pre-
mature enforcement of the Judgment was attested by the fact
that “some 58 interested parties including 12 states ... filed
amicus briefs or other papers [in the Second Circuit] urging
that enforcement be enjoined”. (A40)

_(7) Upon the consent of both Pennzoil and Texaco,
Paragraph 7 was inserted into the Judgment, barring Pennzoil
from enforcing the Judgment for the limited remaining time the
trial court retained jurisdiction, so long as Texaco satisfied
certain conditions.’ Pennzoil refused to agree to further relief
and took the position (correct under Texas law) that the ~ourt
was powerless to give any relief without Pennzoil’s consent.
(A7, A8, A103)

(8) Despite Paragraph 7, in the week after entry of the
Judgment Texaco’s financial condition rapidly deteriorated, to
the point that the company was driven to the brink of bank-
ruptcy. (A10, A90-101)® Texaco’s bonds were downgraded by

Sif Texaco had been forced into liquidation or bankruptcy, a large
percentage of Texaco’s $5,000 employees world-wide, with an annual payroll
of $1.6 billion, would have lost their jobs; and approximately 319,000 Texaco
stockholders, who received $730 million in dividends in 1985, would have
suffered heavy losses. (A40) In addition, “the inability of Texaco to function
in a normal manner” would have “adversely affect{ed] this country’s balance
of payments”, made “this country’s oil supply less secure”, impaired the
“ability to supply military forces” around the world, and “could [have]
prompt[ed]” other foreign actions “harmful to the national security or
foreign policy of the United States”. (A112-13)

7 Under Texas procedure, the expiration of the trial court’s jurisdiction
(and, thus, of Paragraph 7’s terms) could have occurred at the earliest on
February 8, 1986, and at the latest on March 25, 1986. (A89)

8 For at least two reasons, Paragraph 7 failed to stop Texaco’s financial
deterioration. First, lenders and suppliers knew that Paragraph 7 would
expire in a short period of time, after which Pennzoil could attach or execute
on Texaco’s property. Second, there was reluctance to deal with Texaco
because of uncertainty over whether particular transactions were permitted
under Paragraph 7, which, inter alia, prohibited Texaco from engaging in
transactions other than “in the routine and ordinary course of business”.
(A110, A90-101) :,

Pennzoil itself aggravated the situation by publicly threatening to undo
whatever limited protection Paragraph 7 afforded. Specifically, Pennzoil’s
chairman warned that the company was “ ‘going to put pressure’” on the
Texas trial court to permit attachment of liens unless Pennzoil was satisfied
with Texaco’s settlement proposals, and a Pennzoil director and “legal

4

Moody’s from investment grade to non-investment grade;
Texaco was forced to withdraw from the commercial paper
market; banks with which it did business advised that they
would no longer lend the company money on unsecured terms
because of the “uncertainties” of Paragraph 7; potential joint
venturers with Texaco cancelled negotiations because of similar
uncertainties; suppliers refused to do business with the company
on regular and customary terms; and companies refused to
negotiate routine deals for the purchase of Texaco assets.
(A10, A40)

(9) Because of the severity of Texaco’s financial crisis, on
December 13, 1985, Texaco requested an emergency confer-
ence with the Texas trial court. The trial court at first
responded favorably but later refused to hold a conference
when Pennzoil objected. Pennzoil in fact took the position that
it would never agree to such a conference. (A10, A101-02)

(10) Without Pennzoil’s consent, the only other possible
avenue of relief in Texas from application of the lien and bond
provisions was a constitutional challenge brought on “by
motion and mandamus”. (A110) Such a challenge—uncertain
at best9—could not have provided Texaco with “adequate and
timely” relief. (A10, A37) When Texaco sought its federal
injunction, “time [was] of the essence” (A35)—the company
was literally within days of bankruptcy. To pursue mandamus
in Texas would have required Texaco to expend “precious
time” (A37)—time it did not have—requesting the Texas trial

strategist” charged Texaco with violating the “standstill” provisions of
Paragraph 7 “by providing letters of credit from its bankers in purchasing
products and services” —a clear threat to have the “standstill” lifted. (A46,
A105)

® According to the State of Texas in the court below, for mandamus to
lie, “[t]he applicant must have a clear right to the performance of the act
requested” and “[t]he target of the writ must have a clear duty to perform the
act”. (Brief of the State of Texas, Intervenor-Appellant (“Tex. Br.”) at 32
n.10; emphasis added) To the extent there was a “clear right” and “clear
duty” here, it was the right of Pennzoil, under the mandatory provisions of
Tex. R. Civ. P. 364(b), to execute its Judgment absent a ful! supersedeas
bond, and the duty of the Texas state courts not to grant a stay of execution
absent such a bond.

“3

court, in the first instance, to disregard the plainly non-
discretionary dictates of Rule 364(b); then filing a mandamus
petition with the Texas appellate courts; if successful on that
petition, engaging in further remand proceedings; and if
unsuccessful, petitioning this Court under 28 U.S.C. § 1257.
(A38) 10

(11) Against the devastation which would have been
caused to Texaco, application of the lien and bond provisions
was wholly unnecessary to protect any legitimate Pennzoil
interest. As the Second Circuit observed, “there is no serious
dispute that, should Texaco be required to liquidate its substan-
tial assets, it would be able to pay Pennzoil’s judgment in full”.
(A45-46)11

(12) Given Pennzoil’s conceded lack of need for security
and the conceded seriousness of the questions raised by
Texaco’s state court appeal, it is likely, as the Second Circuit

10 The “stipulation” offered by Pennzoil after Texaco had instituted its
federal suit—under which the Texas trial court would apply the standards of
Fed. R. Civ. P. 62 in determining the security required of Texaco pending
appeal (A129-30)—‘“d[id] not solve the problem Texaco face[d] in this
action”. (A48) The “stipulation” purported to confer upon the Texas trial
court discretionary power that (a) the Texas legislature and appellate courts
have expressly withheld, (b) the trial court had shown no inclination to use
(in fact, had avoided even a conference to discuss), and (c) the Texas courts
have no experience in exercising (indeed, as to which their entire tradition is
to the contrary). (A48-49) Further, Pennzoil counsel represented to the
district court that, if Pennzoil were to proceed in Texas under the “stipula-
tion”, it would insist on a bond equal to “the full value of the Judgment”.
( Transcript of Hearing before Hon. Charles L. Brieant, Jan. 9, 1986, at 64; see
also A48) Had the Texas trial court not set such a bond, presumably Pennzoil
would have appealed in the Texas state courts. As a result, the “stipulation”
simply added to the financial and business community’s justified apprehen-
sion and confusion over Texaco’s continued viability.

'' Texaco’s appraised net worth as of December 31, 1984, was in excess
of $22.6 billion; Pennzoil itself estimated that Texaco had assets far greater
than necessary to satisfy the Judgment; Pennzoil’s chairman publicly con-
ceded that “ ‘he did not doubt Texaco’s ability to pay the damages’”; and
there was “no evidence that Texaco, a publicly held corporation, would seek
to encumber its property other than as would be necessary in the normal
course of business or that it would transfer any of its assets to defraud
Pennzoil”. (A46-47) Moreover, Pennzoil has never challenged the adequacy
of the $1 billion bond set by the district court and has never sought to avail
itself of the procedures explicitly established by that court (and approved by
the Second Circuit) to increase the security if circumstances change.
(A53-55)

6

noted, that “[Pennzoil’s] pressure to apply the Texas lien and
supersedeas bond requirements may, as Texaco charges, be
motivated more by Pennzoil’s understandable desire to obtain a
favorable settlement of the Texas action than by genuine
concerns about possible inability to collect if its judgment
should be affirmed on appeal”. (A46)*'2

From the above undisputed factual record, several points
emerge which demonstrate why Pennzoil’s appeal does not
merit plenary review by this Court. None of those points is
evident from Pennzoil’s Jurisdictional Statement.

First, Texaco did not seek—and the courts below did not
sanction—a constitutional requirement of “an affordable stay
of judgment pending appeal”. (JS i) The narrow ruling below
is simply that when the application of lien and bond provisions,
which are impossible for a judgment debtor to satisfy and
unnecessary to protect any legitimate interest of a judgment
creditor, prevents a defendant from effectively exercising a state
guaranteed right to appeal, that application raises a due process

12 Indeed, the same can be said of the motivation behind the instant
appeal. On February 21, 1986, the day after the Second Circuit’s decision,
Pennzoil’s chairman was reported in the New York Times as saying that
“Pennzoil probably would not appeal the latest ruling”, and that the result
below was “a step in the right direction” (New York Times, February 21,
1986, section D at 1, col. 6); and he was reported in The Wall Street Journal
as saying that the Second Circuit's affirmance did not “hurt [ Pennzoil] at all”
and “actually helps” ( The Wall Street Journal, February 21, 1986, at 3, col.
2). In light of those statements, the only plausible explanation for Pennzoil’s
current appeal is to keep settlement pressure on Texaco.

And, Pennzoil’s tactic appears immediately to have had its intended
effect. On March 25, 1986—four days after Pennzoil filed its notice of
appeal— The Wall Street Journal reported that Moody’s, reversing its prior
position, had decided that “a possible upgrading of Texaco’s commercial
paper rating will have to await the outcome of Pennzoil’s court effort to have
the standstill extended, as well as the outcome of its move to take the appeals
court decision to the-U-S. Supreme Court”. ( The Wall Street Journal, March
25, 1986, at 7, col. 1) The same day, The Wall Street Journal quoted Joseph
D. Jamail, Pennzoil’s lead counsel, as stating that “|a]ny banker that loans
money to [Texaco] now is a lunatic”. Jd.

7

question sufficiently substantial to support a preliminary in-
junction. '3 Such relief is particularly warranted where, as here,
the defendant’s state court appeal prese ious challenges to
the underlying judgment not only under State law, but under
the laws and Constitution of the United States as well.'4
Pennzoil cites no case to the contrary.

Second, Texaco did not seek—and the courts below did not
sanction—a rule which, for Section 1983 purposes, transforms
into “the state” every state court judgment winner. (JS 10-!1)
State action is involved here not because Pennzoil was the
“winning” party in Texas or because it obtained a judgment in
the Texas trial court, but because, prior to final (and pre-
clusive ) adjudication of its claims, Pennzoil could invoke (and
control) the unsupervised power of state officials to aid in the
attachment, seizure and sale of Texaco’s property, and because
Texaco asks that this joint activity be enjoined on constitutional
grounds.

Third, Texaco did not seek—and the courts below did not
sanction—a result which amounts to review or modification of
Pennzoil’s Judgment or which ousts the Texas state courts from
their unfettered ability to rule on the merits of the Pennzoil v.
Texaco lawsuit. All the injunction below does is preserve
Texaco’s ability to pursue an effective appeal in the Texas state
courts, and that appeal is moving forward right now.'5

Fourth, Texaco did not seek—and the courts below did not
sanction—interference with any on-going state court proceed-
ing, and certainly not interference with a state court proceeding
in which Texas has a “vital” interest sufficient to justify federal

'3 See Evitts v. Lucey, 105 S. Ct. 830, 838 (1985).

14 See Henry v. First Nat'l Bank of Clarksdale, 595 F.2d 291 (Sth Cir.
1979), cert. denied, 444 U.S. 1074 (1980).

‘5 On April 23, 1986, Texaco filed its appeal brief in the Texas Court of
Appeals challenging the Judgment on 90 separate state and federal grounds,
based on both substantive and procedural errors committed by the Texas trial
court. The appeal is scheduled for argument and submission on July 31,
1986.

8

court abstention under the doctrine of Younger v. Harris, 401
U.S. 37 (1971). Pennzoil’s lawsuit against Texaco in Texas is a
‘purely private dispute involving purely private parties, and the
State of Texas expressly represented in the court below that it
has “no interest in the outcome” of that dispute. (Tex. Br. at
2) Further, by its “stipulation”, Pennzoil has purported to
replace the Texas lien and bond provisions with federal proce-
dures, thus suggesting that Pennzoil itself does not believe a
“vital” state interest is implicated here. (JS 2, 17 n.10; A48) 16

Fifth, the present action was filed in response to an
imminent threat of irreparable harm to Texaco (and to the
public interest) which could not have been averted by
“adequate and timely” state court procedures. (A37) Under
Younger itself, abstention is inappropriate in such exigent
circumstances.

Sixth, the ruling below, far from creating a “yawning
breach” (JS 6) or “‘capacious zone” (JS 7) or “ominous gap”
(JS 16) in rules of federalism and comity, is extremely narrow.
As the Second Circuit noted, the “extraordinary circumstances
of this case ... are unlikely ever again to recur”. (ASO) Those
circumstances include: a concededly impossible bond require-
ment which local provisions gave state courts no discretion to
modify or suspend; a conceded lack of need for security by the
judgment creditor; the imminent destruction of a state guaran-
teed right to appeal in a purely private civil litigation raising
serious federal and state issues; a putative state court man-
dainus remedy that was uncertain at best where no uncertainty
~ could be tolerated; a request for federal relief which preserved
rather than truncated state appellate power; and the distinct
possibility that Pennzoil was deliberately threatening to use
local officials and security procedures, not to make itself more
secure as a judgment creditor, but to pressure Texaco to settle

16 Moreover, as mentioned above, Texas has not separately appealed the
Second Circuit’s narrow ruling. Compare Diamond v. Charles, 54 U.S.L.W.
4418, 4421 (U.S. April 30, 1986).

9

the state court action prior to any appeal. (A46, ASO, Al05-
106) 17

ARGUMENT

None of the issues raised by Pennzoil merits plenary
review by this Court. Accordingly, the ruling below should be
summarily affirmed.

A. The Second Circuit’s Due Process Holding Does Not
Merit Plenary Review.

Because the Second Circuit’s “narrow” ruling on Texaco’s
due process claim is correct in the “unique and extraordinary
circumstances of this case” (A35; ASO), it does not merit this

17 By an amazing deluge of rhetoric, Pennzoil seeks to divert attention
from what really happened below. Pennzoil accuses the Second Circuit of
“opening a yawning breach in the walls of statutes and judicial doctrines”
governing federal/state relations (JS 6); of “constructing a contrived complex
of exceptions to . . . comity rules” (JS 7); of “creat{ing] a capacious zone
within which comity is simply inapplicable” (JS 7); of “creat{ ing] a no-man’s
land” within which comity rules are inoperative (JS 8); of creating “a
jurisdictional darkling plain where litigants shanghaied from state courts clash
by night” (JS 8); of “providing . . . a privileged entree” to federal courts for
litigants wishing to “deliberate[ly] bypass” or “side-swip[e] on-going state
court proceedings” (JS 8); of “drastically erod[ing]” and “cannibaliz[ing]”
the Anti-Injunction Act (JS 12); of creating “a large and wholly unjustified
zone” within which state proceedings can be enjoined (JS 12-13); of
“creat[ing] a zone within which ail rules of comity are rendered entirely
inoperative” (JS 14; emphasis in original ); of “creat[ing] an ominous gap in
fundamental principles of comity” (JS 16); of “ma[king] nonsense of the
law” (JS 14); of “gutt{ing]” the rules of abstention based on “a series of
distrustful speculations” and “abstract and hostile speculations” (JS 16, 19);
of “allow[ing] litigants to assemble jurisdictional sandwiches to suit their
tastes” (JS 20); of “creat{ing] a looking-glass inversion of federalism” (JS
22); of “executing an end-run around the state courts” (JS 22); of “re-
plac[ing] federal comity with an anti-comity principle” (JS 22-23; emphasis
in original ); of reaching a “topsy-turvy result” ( JS 23); of opening the door to
“wide-scale evasions of this Court’s comity rulings” (JS 28); of offering
litigants “a fielder’s choice” between state and federal forums (JS 28); of
giving litigants “free[dom] to roam across jurisdictional borders” (JS 29);
and of “fundamentally alter[ ing] the jurisdictional landscape” (JS 29). That
onslaught of alarmist verbiage hardly describes the Second Circuit's decision.

10

Court’s plenary review. Pennzoil ignores those circum-
stances—all of which are undisputed.

As Pennzoil would have it, the Second Circuit ruled that “a
judgment debtor has a Fourteenth Amendment right to an
affordable bond”. (JS 5) Nothing the Second Circuit said or
did justifies that sweeping characterization. On the contrary,
the Court of Appeals’ “narrow holding” (A35, AS1) was
carefully limited to a situation (1) where the posting of a
mandatory $12 billion bond was “impossible” not just for
Texaco, but for any judgment debtor (A35); (2) where the
“inflexible” operation of a state’s non-discretionary lien and
bond provisions would render the judgment debtor’s guaran-
teed right to appeal “an exercise in futility” by “irrevocabl[y]”
destroying it prior to any appellate review (A24, A44); and (3)
where the provisions’ unmitigated application was “unneces-
sary” to protect the judgment creditc ¢ pending appeal and thus
bore no rational relationship to the state’s purpose in enacting
them (A24, A34-35, A44).

Pennzoil concedes the controlling Fourteenth Amendment
principle which mandates summary affirmance in these circum-
stances—that once a state such as Texas guarantees a right to
appeal, “the Constitution foreclose[s] the option of limiting the
right. . .by irrational or arbitrary requirements”. (JS 24; em-
phasis added)'® And yet, having paid lip service to this
principle, Pennzoil utterly fails to explain why application of
the lien and bond provisions in the circumstances of this case
does not irrationally deprive Texaco of its right to appeal—an
appeal raising “non-frivolous” federal and state issues
(A42)—given the undisputed fact that such application is
“unnecessary” to protect Pennzoil pending appellate review. '9

18 As this Court said just last term in Evitts v. Lucey, 105 S. Ct. 830, 838
(1985), “[t}he right to appeal would be unique among state actions if it
could be withdrawn without consideration of applicabie due process norms”.
See also Logan v. Zimmerman Brush Co., 455 U.S. 422, 429-30 & n.5 (1982);
Williams v. Oklahoma City, 395 U.S. 458, 459-60 (1969); Douglas v.
California, 372 U.S. 353, 357-58 (1963).

19 Pennzoil ignores this latter undisputed fact, which limits the scope of
the Second Circuit’s due process ruling. How often, for example, will a
“*Mom-and-Pop’ grocery store” (JS 27) be unable to post security for a

‘
11

In an attempt to avert summary affirmance, Pennzoil offers
several arguments, none of which is availing.

First, Pennzoil contends that “Texas has not limited
Texaco’s appeal rights” because the prosecution of an appeal in
Texas is not expressly conditioned upon compliance with the
state’s supersedeas bond requirement. (JS 24; emphasis in
original ) That, of course, exalts form over substance. The court
below found, as a matter of undisputed fact, that operation of
the lien and bond provisions in this case would “render
[Texaco’s] right to appeal in Texas an exercise in futility”
(A24)—a “meaningless ritual” —by “robb[ing] [it] of any
effectiveness” (A43-44).

Second, Pennzoil contends that “there is nothing irrational
in Texas’ decision to safeguard fully the interests of those who
have won judgments in Texas courts”. (JS 25) But no one is
arguing otherwise. Texaco’s due process claim does not attack
the facial validity of the lien and bond provisions and thus does
not question that the state had a rational and legitimate purpose
in enacting those statutes. Rather, Texaco’s claim is that
application of the provisions would be irrational in “the unique
and extraordinary circumstances of this case” (A35), because
Texaco’s right to appeai would be eviscerated without advanc-
ing the state interest at issue (A34-35).

Third, Pennzoil contends that Texaco has already been
accorded sui sient “due process” by the supposedly “full and
fair” Texas trial which produced, by orders of magnitude, the
largest civil judgment in United States legal history. (JS 23)
But that argument ignores this Court’s teaching in Evitts that
once a state provides a right to appeal, that right cannot be
limited or withdrawn without comporting with “applicable due
process norms”. 105 S. Ct. at 838. States such as Texas
guarantee a right to appeal precisely because they recognize
that trial court adjudication carries a significant “risk of an
erroneous deprivation”.2° And here, as the Second Circuit

judgment but have assets so substantially in excess of the judgment that the
judgment creditor itself publicly concedes that security pending appeal is
unnecessary? In how many of those cases will local courts have no discretion to
tailor security to need? (See infra at n.25)

20 See Mathews v. Eldridge, 424 U.S. 319, 335 (1976).

12

found, it is “clear” that Texaco “has raised non-frivolous issues
as the basis for its Texas appeal”. (A42) It would be the
height of irrationality if the interim and unnecessary enforce-
ment of an erroneous trial court judgment irrevocably destroyed
Texaco before the appellate courts had the opportunity to
resolve its meritorious appeal.2' |

Fourth, Pennzoil contends that the Second Circuit’s due
process ruling “flies in the face of this Court’s long-settled
precedents”. (JS 25-26) Yet, Pennzoil relies on only two cases
to support its sweeping assertion (JS 24), and both are
irrelevant.22

Fifth, Pennzoil contends that the Second Circuit’s decision
“threat[ens] ... the orderly administration of justice” in at
least 30 states which purportedly have supersedeas bond stat-
utes like Texas. (JS 26-27) But that dire forecast, obviously

21 It is significant to note in this connection that the State of New York
has recently filed an amicus brief in the Texas intermediate appellate court
urging reversal of the Judgment on the ground that the Texas trial court’s jury
charge “substantially misstated the applicable New York caselaw”. (Brief
Amicus Curiae of the Attorney General of the State of New York, May 12,
1986, at 28)

22 The issue in National Union of Marine Cooks & Stewards v. Arnold,
348 U.S. 37 (1954), was whether due process was violated by a state court
dismissal of the defendant’s appeal from a $495,000 judgment for flouting
repeated court orders that he deliver $295,000 of out-of-state assets to a
receiver for safekeeping pending appeal—the only substantial assets the
defendant owned. In sustaining the appeal’s dismissal, this Court held only
that a state court has “inherent power to use its processes to induce
compliance with a supplemental order reasonably issued in aid of execution”,
and that “|w]here the effectiveness of a money judgment is jeopardized by
the judgment debtor, he has no constitutional right to an appeal extending
that frustration”. Jd. at 44. That has nothing to do with this case, particularly
given Pennzoil’s conceded lack of need for security and the complete absence
of any evidence that Texaco would unreasonably encumber or fraudulently
transfer its assets pending appeal. (A46-47)

Equally irrelevant is Louisville & Nashville R.R. v. Stewart, 241 U.S. 261
(1916). All this Court held there was that a state could add 10% to the
amount of a judgment if affirmed on appeal as the cost of the judgment
debtor’s obtaining a supersedeas bond which suspended execution pending
appeal. Jd. at 263. Since there was no claim in Stewart, nor could there have
been, that that requirement effectively rendered the defendant’s appeal
meaningless, that case does not even remotely resemble this one.

———-

—

13

made to interest this Court in plenary review, is based on
Pennzoil’s misstatement of the Second Circuit’s holding that a
judgment debtor is constitutionally entitled to “an affordable
bond”. The Second Circuit’s “narrow” ruling (A35), expressly
limited to a “unique” and “extraordinary” set of circumstances
“unlikely ever to recur” (A35, ASO), threatens no more dis-
ruptive effect on state supersedeas requirements than the Fifth
Circuit’s similarly “narrow” decision seven years ago in Henry
v. First Nat’l Bank of Clarksdale, 595 F.2d 291, 301 (Sth Cir.
1979), cert. denied, 444 U.S. 1074 (1980). (A51)23

There is no indication that any of the states whose interests
Pennzoil purports to be championing agrees with its doomsday
prediction. On the contrary, nine of those states filed amicus
briefs in the Second Circuit “urging that enforcement [of
Pennzoil’s judgment] be enjoined”. (A40)24 Alabama’s posi-
tion is illustrative:

“The State of Alabama, like the State of Texas, has a
supersedeas bond requirement and judgment lien statute,
the purpose of which is to protect judgment creditors
during the pendency of appeals, should they ultimately
prevail. However, in this case, the unmitigated application

23 In Henry, the Fifth Circuit held that where state law security provisions
threaten to impair vital federal rights and interests by precluding meaningful
appellate review of state court tort judgments, the federal courts can act to
enjoin the state court plaintiff from invoking those security provisions, thereby
preserving the right of state court and Supreme Court review and protecting
the federal interests implicated. The narrow federal relief granted in Henry
gave this Court an opportunity to undertake meaningful review of the local
substantive law at issue there. Ultimately, this Court struck down that law, as
applied, on the ground that it impermissibly burdened federally protected
conduct. NAACP v. Claiborne Hardware Co., 458 U.S. 886 (1982).

Like Henry, the present case involves a Judgment that, Texaco argues on
appeal in Texas, will punish and deter conduct that federal constitutional and
statutory law protects and encourages. Here, as in Henry, local lien and bond
provisions threatened immediately to make that deterrent effect permanent
and irrevocable by precluding meaningful state ( and, if necessary, Supreme
Court) review of the serious federal issues raised by the Judgment. Here, as
in Henry, the federal courts possess both the power and the obligation to
prevent such an intolerable result.

24 The nine states are Alabama, Alaska, Delaware, Kansas, New Mexico,
New York, Oklahoma, Washington and Wyoming.

14

of such provisions will destroy a judgment debtor before it
has a meaningful opportunity to seek vindication through
the state appellate system. We believe that an appropriate
balance must be struck.

“We respectfully submit that [the district court] did
just that in assuring Texaco’s right to a meaningful appeal
while providing Pennzoil with adequate security under
Rule 65(c). It is no affront to state sovereignty for a
federal court to guarantee a state court litigant a mean-
ingful right to pursue its state court remedies.” (Brief of
Amicus Curiae The State of Alabama In Support of The
District Court Preliminary Injunction, dated January 30,
1986, at 4-5)25

In sum, the Second Circuit’s due process ruling does not
merit plenary review by this Court.26
B. The Second Circuit’s State Action Holding Does Not
Merit Plenary Review.

Pennzoil contends that the Second Circuit’s state action
holding (1) “radically expands” the state action principles of

251t should also be noted that Pennzoil’s 30-state head count is
inaccurate. To begin with, Pennzoil itself admits that 16 of those jurisdictions
“explicitly allow[ ] the trial court some equitable discretion to reduce the size
of the bond”. (JS 26 n.17) Three of the remaining fourteen states which
Pennzoil counts as having non-discretionary full bonding requirements in fact
expressly authorize courts to reduce the bond. (New York, N.Y. Civ. Prac.
Law § 5519(c); Oregon, Or. Rev. Stat. § 19.045; Virginia, Va. Code § 8.01-
676.1) These nineteen states, then, stand in marked contrast to Texas which,
as the Second Circuit found, has a supersedeas requirement that is non-
discretionary on its face and has “repeatedly been declared by Texas courts to
be mandatory. . .”. (A9)

As for the other eleven so-called non-discretionary jurisdictions, four
have no reported decisions interpreting their supersedeas statutes as either
discretionary or non-discretionary (lowa, Arkansas, Michigan, Minnesota);
and of the final seven states four appeared below as amici in support of the
preliminary injunction against Pennzoil (A3; Alabama, Delaware, New
Mexico and Oklahoma ).

26 Under 28 U.S.C. § 1254(2), the due process ruling is the only matter
before this Court on direct appeal. As for the other issues raised by Pennzoil,
this Court “retains discretion to decline to consider [them]”. Davis v.
Scherer, 104 S. Ct. 3012, 3017 n.7 (1984). For the reasons set forth in the
remainder of this motion, those other issues do not merit this Court’s
consideration.

15

Lugar v. Edmondson Oil Co., 457 U.S. 922 (1982) (JS 10); and
(2) “eviscerates” the Anti-Injunction Act (JS 9). Both con-
tentions lack merit.27

1. The Second Circuit’s decision is well within Lugar.

This Court’s state action holding in Lugar turned on the
presence of two factors. First, this Court relied on the presence
of a “procedural scheme created by ... statute” that was
“obviously ... the product of state action”. 457 U.S. at 941.
The specific scheme was a security procedure that balanced
competing claims to disputed property pending trial by allow-
ing attachment of property under certain circumstances. Sec-
ond, this Court relied on the fact that, by invoking the state
security provisions at issue, a private party triggered (and
controlled ) action by state officials. 457 U.S. at 941-42. As this
Court explained, “a private party’s joint participation with state
Officials in the seizure of disputed property is sufficient :o
characterize that party as a ‘state actor’ for purposes of the
Fourteenth Amendment”. /d. at 941.

In finding state action in the instant case, the Second
Circuit relied on precisely the same two factors that were
dispositive in Lugar. First, as in Lugar, there is here a
procedural scheme created by statute that is obviously the
product of state action. (A24) That scheme (described supra
at 1-2) involves security provisions which, through attachment
and supersedeas mechanisms, balance competing claims to
disputed property pending appeal. Second, as in Lugar, a
private party’s invocation of the security provisions here would
have triggered (and allowed the private party to control ) action
by state officials. (A25-26)

Pennzoil does not—and cannot—dispute that both Lugar
and the decision below were based upon these same two
predicates. Instead, Pennzoil contends that Lugar is not
controlling here because. it involved security provisions that
operated pending resolution through (rial of competing claims

27 Significantly, Pennzoil did not see fit to argue the state action issue
before the district court.

16

to disputed property, whereas the security provisions here
operate pending resolution of such claims through appeal. (JS
10) Under Pennzoil’s reading of Lugar, inv%< «ion of precisely
the same security provisions—involving precisely the same kind
and extent of official action—would properly involve state
action pending initial adjudication through trial, but could
never involve state action pending appeal, even though a
judgment at that stage is non-final under state law and is
subject to corrective review.28

Pennzoil is wrong. Pennzoil relies on three elements in
Lugar which it claims are unique to the prejudgment context.
In fact, each element is present here as well.29

First, Pennzoil stresses that the security procedures in
Lugar allowed seizure of “disputed property”. (JS 10; empha-
sis in original) That is no less true here. The state’s decision to
provide a process of appellate review—a decision that con-
templates the need to correct error committed in the initial
phase of adjudicatioa—demonstrates that a live and important
“dispute” continues with respect to the property at issue.3°

28 Texas law accords judgments no finality or preclusive effect until all
appeals have been exhausted. E.g., Glen Oaks Util., Inc. v. City of Houston,
280 F.2d 330, 334 (Sth Cir. 1960); accord Archer v. Bill Pearl Drilling Co.,
655 S.W.2d 338, 341 (Tex. App. 1983).

29 Pennzoil also overlooks the fact that state action arising from in-
vocation of a local security scheme can support a Section 1983 claim only
when (as in Lugar and here) that claim challenges the constitutionality of the
particular scheme (either on its face or as applied). Cf Lugar, 457 US. at
941. Because of this required nexus, the state action ruling below, contrary to
Pennzoil’s assertion, cannot be used in other contexts to support “imaginative
constitutional objections” to other “state procedural and structural rules
governing the processing of litigation”. (JS 8-9; see also JS 11, 28)

30 It is precisely for that reason that Texas courts attribute to post-trial
security procedures the underlying purpose of maintaining “the status quo”.
Renger v. Jeffrey, 182 S.W.2d 701, 702 (Tex. 1944); Kantor v. Herald
Publishing Co., 632 S.W.2d 656, 657-58 (Tex. App. 1982); Shell Petroleum
Corp. v. Grays, 62 S.W.2d 113, 118 (Tex. Com. App. 1933). If, as Pennzoil
claims, completion of what is only the initial phase of adjudication (when,
under Texas law, judgments are non-final and non-preclusive ) in fact suffices
to “determine[ | the relevant rights and liabilities” of the parties—so that the
property at issue is no longer “disputed” (JS 10-11)—there would be no
reason to maintain “the status quo”.

17

Second, Pennzoil stresses that invocation of the security
procedures in Lugar was “judicially unsupervised”. (JS 10;
emphasis in original) That is also true here. The very thrust of
Texaco’s due process claim is that Texas law prevents trial
courts from exercising any discretion or supervisory power over
the invocation of security provisions pending appeal—and that
trial-winners (such as Pennzoil) who have no need for security
may therefore employ those provisions to preclude effective
review on a wholly arbitrary basis.3'

Citing Dennis v. Sparks, 449 U.S. 24, 28 (1980), Pennzoil
contends that the Texas security procedures would not have
been “judicially unsupervised” in this case, because attachment
and execution would have come at the end of a “4% month
trial”, involving “the independent judgment of the state judi-
ciary”. (JS 11 & n.5)32 That proposition misses the point of the
limited constitutional claim at issue here. The “independent
[judicial] judgment” the Texas trial court exercised during the
“4% month trial” was confined to adjudicating the merits of
Pennzoil’s state law claims. In the present lawsuit, Texaco does
not attack that “independent [judicial] judgment’”—Texaco is
doing that on appeal in Texas (and, if necessary, in this Court

31 In fact, the Texas security procedures at issue in the instant case ace
more judicially unsupervised than the Virginia procedures at issue in Lugar.
As this Court observed, under the Virginia statute, upon the ex parte filing of
an affidavit alleging need, the petitioner’s property was “sequestered ...
although it was left in his possession”, and “a hearing on the propriety of the
attachment and levy was later conducted”. 457 U.S. at 924-25. The
attachment would be vacated by the state court upon a failure “to establish
the statutory grounds for attachment”. /d. at 925. In contrast, the Texas
security procedures relating to money judgments make no provision for any
pre-attachment showing of need, for any judicial review of need—either
before attachment or after—or for any possibility of judicial vacatur upon a
failure to establish need.

32 In Dennis, this Court held that “ ‘merely resorting to the courts and
being on the winning side of a lawsuit’ does not make a private party into a
state actor under § 1983". (JS 11) As the Second Circuit observed, Dennis
bars such Section 1983 claims because:

“in such case[s] the independent judgment of the state judiciary is called

into play, and unless unusual circumstances are shown ... a private

party cannot be charged with responsibility for a judicial decision.”
A27-28; emphasis added )

18

by direct review from the Texas Supreme Court). The issue in
the instant case is whether—given Pennzoil’s conceded lack of
need for the particular security provisions involved—Pennzoil
should nonetheless be permitted to invoke those provisions to
preclude corrective review. That is a question which the initial
trial court adjudication of Pennzoil’s claims could not (and did
not purport to) address. Pennzoil overlooks this dispositive
distinction. 33

Third, Pennzoil stresses that the seizure of property prior
to initial resolution of competing claims thereto involves the
exercise of “awesome” power which should be subject to
federal constitutional constraints. (JS 10) But the power,
through seizure of property, arbitrarily to truncate the process
of review that ultimately will determine the property’s rightful
ownership—the power at issue here—is no less “awesome” or
deserving of constitutional limitations.4

The presence here of all elements that Pennzoil contends
were essential to Lugar only makes clearer that this case falls
well within the scope of that decision.35

33 4 different case might be presented if, contrary to fact, the Texas lien
and bond provisions allowed for judicial discretion with respect to the need
for security for money judgments and if, in the independent exercise of that
discretion, a Texas court had denied Texaco relief from the provisions. In
such circumstances, invocation of the provisions by Pennzoil would have been
judicially supervised. That, however, is plainly not this case.

The above is also a complete answer to Pennzoil’s suggestion that “the
Second Circuit's theory” would allow federal lawsuits requesting “additional
argument time before the Texas Court of Appeals” (JS 21 n.14) or stays
pending appeal from state injunction decrees (JS 28 n.19). The con-
stitutional problem involved in the instant case arises only in the rare
circumstance —not present in the cases Pennzoil suggests—where state courts
lack inherent equitable discretion to grant the desired relief.

34 Indeed, this Court has expressly held that the exercise of state power to
preclude an appeal as of right must be and is subject to the constraints of the
Fourteenth Amendment. (See supra at 10 n.18) As this Court observed in
Lugar, Section 1983 “creat{ed] a remedy as broad as the protection that the
Fourteenth Amendment affords the individual”. 457 U.S. at 934.

35 Pennzoil misconstrues the point of this Court’s observation in Lugar
that its holding was “limited to the particular context of prejudgment
attachment”. 457 U.S. at 939 n.21. (JS 10) The observation was made in
specific response to a suggestion that Lugar altered the rule in Dennis that a
private party does not become a state actor merely by instituting or prevailing

19

2. The Second Circuit’s decision does not affect the Anti-
Injunction Act.

Pennzoil contends that the Second Circuit’s holding so
expands the Section 1983 exception to the Anti-Injunction Act,
28 U.S.C. § 2283, that it “drastically erodes”, indeed “canni-
balize[s]”, the Act. (JS 12)

Pennzoil is wrong. A ruling that a particular private party
is a State actor has no impact on the breadth of the Section 1983
exception to the Anti-Injunction Act. If a state proceeding
deprives the state court defendant of federally protected rights,
thereby creating a meritorious Section 1983 claim, the state
court defendant can always institute a Section 1983 injunction
action against the state officials involved in the proceeding
(who are clearly state actors under Section 1983), rather than
against the private state court plaintiff. Such an action would
not be barred by the Anti-Injunction Act, even if the private
state court plaintiff were nor itself deemed a state actor.

3. The Second Circuit’s decision does not offend the
constitutional policies that underlie the state action
doctrine.

Under the decisions of this Court, the state action inquiry is
guided by considerations of wiiether the private party charged
“may fairly [be held responsible as] a state actor”.36 Whether
imposing that responsibility is “fair” cannot be determined
without assessment of the precise burdens such responsibility
entails. Once that inquiry is undertaken, it is clear that the

in a state court litigation. The only limiting principle responsive to that
suggestion turns on the distinction between (a) claims that attack the use by
private parties of unsupervised security procedures to seize disputed property
(which Dennis did not address, but which are present here and in Lugar),
and (b) claims that attack attempts by private parties to employ the judicial
process to resolve disputes (which Dennis forbids). It does not turn on the
pre-trial vs. post-trial distinction that Pennzoil seeks to attribute to Lugar.
The Dennis bar applies with equal force in both the pre-trial and the post-trial
context. That is, critical to Lxgar’s limitation is the element of unsupervised
attachment of disputed property, and not whether the attachment is pre-
judgment or post-judgment.
36 Lugar, 457 U.S. at 937 (emphasis added ).

20

instant case, far from “expand|[ing]” Lugar (JS 10), is signifi-
cantly narrower than Lugar itself.

First, this is solely an injunction action, not a suit for
damages. As the dissent in Lugar noted, it may be unfair to
impose damages under Section 1983 where the only conduct
charged is a private party’s wholly innocent invocation, without
notice or fault, of a seemingly valid state statute.3? That
concern, however, is not implicated where (as here) injunctive
relief alone is sought. The only consequence of losing an
injunction suit is that the federal defendant will be unable to
invoke either an unconstitutional state statute or an otherwise
constitutional state statute in an unconstitutional manner. That
is hardly an unfair “burden”. Moreover, unlike a damages
award, it is a “burden” to which the private party would be no
less subject even if the only available defendant were a state
official.

In addition, fairness concerns may arise in damages actions
because the threat of monetary loss leaves a private defendant
charged as a state actor with no choice but to assume the
burdens of defense.3® Actions limited to injunctive relief do not
pose such a threat.39

Second, in the instant case, unlike Lugar, the private
party’s invocation of state procedures would not have been
wholly innocent or unwary. Pennzoil repeatedly disclaimed the
need for security for its Judgment (see supra at 5 n.11), and
was certainly aware that application of the lien and bond
provisions would have had an irrevocably destructive impact on
Texaco. Hence, Pennzoil’s only reason for resorting to the local
security provisions would have been to preclude appellate
review. That fact readily distinguishes this case from others in

37 457 US. at 956 n.14 ( Powell, J., dissenting ).

38 See id.

39 Even where state officials are not initially named as defendants in an
action challenging the particular application of a state statute, federal law
requires that the state be notified and invited to intervene. 28 U.S.C.
§ 2403(b). The private defendant can then reap the benefits of defense
without assuming any of the corresponding burdens. In the rare case, the
state may determine that it should not defend the particular application at
issue. However, where (a) a specific application of a statute is attacked as
unconstitutional, (b) the state itself acquiesces in that attack, and (c) the
private defendant's sole motivation for defending application of the statute is
the desire to procure its benefits—rather than the need to avoid monetary
liability—the “burdens” of defense are hardly unjustified.

*

21

which the private party invokes a “seemingly valid statute”
wholly unaware that an infringement of rights may result.

In sum, the instant case falls well within Lugar. It certainly
offers no reason to reassess this Court’s settled state action
doctrine.

C. The Second Circuit’s Younger Holding Does Not Merit
Plenary Review.

Pennzoil claims that the Second Circuit’s decision “repu-
diates” the abstention doctrine this Court has developed under
Younger v. Harris, 401 U.S. 37 (1971). (JS 13) In fact, the
decision below merely declines to expand Younger in a manner
unjustified by the “unique” and “extraordinary” circumstances
of this case—including the fact that the limited federal relief
preserves, rather than undermines, state court appellate power.

1. The narrow federal relief at issue does not implicate a
“vital” state interest.

Under this Court’s decisions, Younger abstention is war-
ranted only when a state court action seeks to vindicate “‘vital
state interests”.49 In each case decided under Younger, this
Court has focused on the particular subject matter of the state
court litigation—carefully explaining why that subject matter
did in fact embody especially important public interests.41 That
repeated focus by this Court has made clear that the mere
pendency of a state court proceeding—as opposed to the
particular subject matter of the proceeding—does not supply
the “vital” state interest required to justify abstention.

Pennzoil’s lead Younger argument ignores this basic dis-
tinction. Pennzoil argues that it is a “contradiction in terms” to
hold both (a) that state action is present (as necessarily is true
any time some judicial action is taken in a pending state court
lawsuit) and (b) that Younger absention is not warranted. (JS

40 See Middlesex County Ethics Comm. v. Garden State Bar Ass’n, 457
U.S. 423, 432 (1982).

41 E.g., Middlesex County Ethics Comm., 457 U.S. at 434-35; Moore v.
Sims, 442 U.S. 415, 434-35 (1979); Juidice v. Vail, 430 U.S. 327, 335-36 &
n.12 (1977).

22

14) That is so, Pennzoil contends, because state action under
Section 1983 requires “the exercise of public power” and
because the presence of such “public power” must itself trigger
Younger. (JS 14; emphasis in original) Thus, according to
Pennzoil, whenever state action exists for Section 1983 pur-
poses, there is a “vital” state interest for Younger purposes. (JS
15).

Pennzoil in fact has things reversed. In the present context,
a private party is considered a state actor for Section 1983
purposes only when the state has ceded to him the power to
invoke and control, in an unsupervised manner, the conduct of
state officials. That is inconsistent with a finding of a “vital”
state interest. Under Pennzoil’s theory, the less control the state
exercises and the more control it abdicates to private parties,
the more “vital” its interest.

If Pennzoil’s argument were correct—and it is not—it
would automatically extend Younger to “ ‘every pending pro-
ceeding between a State and a federal plaintiff ”, a result “not
remotely suggest{ed]” by this Court’s prior decisions¢?—
indeed, it would, contrary to Pennzoil’s disclaimer (JS 14 n.8),
automatically extend Younger to all “ ‘purely’ private” civil
state court lawsuits.43 Pennzoil’s theory would also (a) me-
chanically bar relief, under Younger, in every Section 1983
action, thereby significantly eroding Mitchum v. Foster, 407
U.S. 225 (1972); and (b) render inexplicable this Court’s
careful focus in each Younger decision on the particular subject
matter of the state court litigation—as opposed to the mere
pendency of the proceeding.

Pennzoil next contends that the state interest at issue
here—the interest of the State of Texas “in the functioning and
enforcement of its bond and lien laws”—falls within the class of
“vital” public interests triggering Younger abstention. (JS 15)

42 Moore v. Sims, 442 U.S. 415, 423 n.8 (1979).

43 That is so because, as mentioned above, judicial action taken in such
lawsuits inherently involves “the exercise of public power”. Under Pennzoil’s
theory, that “exercise of public power” itself mandates application of
Younger. (JS 14)

23

To support that contention, Pennzoil relies on this Court’s
decision in Juidice v. Vail, 430 U.S. 327 (1977). Pennzoil,
however, seriously misconstrues the holding of that case.

In Juidice, the federal plaintiff had been arrested and
incarcerated pursuant to a state court order of contempt
rendered against him after he (a) had ignored a court-ordered
subpoena requiring him to attend a deposition: and (b) had
ignored a further court order requiring him to appear to explain
his failure to obey the subpoena.44 Rather than respond to the
contempt order, the federal plaintiff brought a federal challenge
to the state debt collection procedure, which included the
deposition and contempt citation he had ignored.

This Court ruled that federal abstention was appropriate in
those circumstances. Pennzoil suggests that the Court did so
because it recognized that the collection of private debts
amounts to a “vital” state interest. (JS 15) Pennzoil is wrong.

The Court in Juidice could not have made it plainer that
the focus of its opinion—the “vital” state interest in-
volved—stemmed from the use of the contempt process itself
(and not from the particular private interest that contempt
happened to serve).45 The Juidice federal plaintiff had been
the object of two state court orders and had violated both.
Contempt was the state’s method of punishing him. As this
Court said, the federal plaintiff had committed “ ‘an offense to
the State’s interest ... as great as it would be were this a
criminal proceeding’ ”’.46

Pennzoil has thus confused the particular private interest
that contempt in Juidice served with the process of contempt

44 430 US. at 329.

45 430 US. at 335-36 & n.12. It is, of course, clear why contempt
proceedings implicate vital state interests. The contempt power enforces the
principle that dissatisfied litigants must challenge state judicial action by
lawful process rather than through private disobedience. No principle is more
central to the integrity of the state’s judicial function.

46 Juidice, supra, 430 U.S. at 336 (quoting Huffman v. Pursue, Lid., 420
U.S. 592, 604 (1975)).

24

itself.47 If a federal court may properly enjoin the entry of
judgment in a state court proceeding, as undoubtedly it may
under Mitchum, a federal court surely cannot be barred per se
from enjoining ancillary statutes governing the timing and
terms on which state court judgments are to be secured.4®

Certain additional unusual and distinguishing features of
this case underscore the illogic of finding a “vital” Younger
interest here. -

First, unlike any Younger case in this or any other court,
here the narrow federal relief does not interfere with “the
regular operations of [the state’s] judicial system”. (JS 15,
quoting Juidice, 430 U.S. at 355.) In every case requiring
Younger abstention, the federal plaintiff sought to stop an
ongoing state proceeding in its tracks. The narrow federal relief
at issue here achieves the very opposite result. That relief was
sought (and is required) to enable the state litigation to
continue to completion within the state system. That relief
advances the same interest that every Younger case has sought
to protect.

Second, unlike any Younger case in this or any other court,
“[h]Jere the state [of Texas] has no interest in the underlying
[ state court] action” ( A34), and explicitly so stated in the court
below (Tex. Br. at 2). Neither Texas nor any Texas state
agency is a party to the Pennzoil v. Texaco lawsuit. “It is a suit
between two private parties stemming from the defendant’s
alleged tortious interference with the plaintiffs contract with a
third private party. An injunction here does not prevent any
arm of the state from acting to vindicate a state policy or to
punish an infraction of state rules.” (A34)

47 Juidice itself placed no weight on the private debt collection function
advanced by contempt there. This Court described the debt collection
function as involving “purely private concerns”, and contrasted the state’s
vital interest in contempt with those private interests in aid of which contempt
may sometimes be invoked. 430 U.S. at 336 n.12.

48 Pennzoil is, therefore, flatly wrong when it characterizes the decision
below as holding that “federal injunctions may be granted entirely without
comity constraints” whenever the federal defendant is a private party. (JS
15-16) Had the Second Circuit thought that Younger could not apply to a
private federal defendant, it would have had no reason to consider whether
the particular subject matter at issue embodied “vital” state interests adequate
to trigger Younger.

25

Third, unlike any Younger case in this or any other court,
here the only state that could arguably have a “vital” interest in
application of the local security provisions—the State of Texas
—was a party below but has not itself appealed.

Fourth, unlike any Younger case in this or any other court,
here there is no claim that the narrow federal relief at issue has
in any way compromised the asserted state interest in securing
judgments. Pennzoil itself has conceded that it does not need
liens or a bond to be secure. (A45-46)

Fifth, unlike any Younger case in this or any other court,
here the state plaintiff (and federal defendant) has purported
“by stipulation” to waive the local security statutes—the stat-
utes it asserts embody “vital” state interests—and replace them
with federal procedures. (JS 2, 17 n.10) That purported waiver
suggests that even Pennzoil itself does not believe that the local
provisions evidence a “vital” state interest. Nor can Texas have
a “viial” state interest in application of the federal procedures.

2. Texaco lacked a practical remedy in the Texas state
courts.

Even if a “vital” state interest were present here—and it is
not—Pennzoil could not satisfy the second requirement for
Younger abstention: that there be an adequate and timely
remedy for the federal plaintiff within the state court system.
Pennzoil contends that, absent an absolute “procedural bar”
under local law, Younger abstention is required. (JS 16-20) In
the circumstances of this case, that contention is nonsense.
Where, as here, the threat of great and irreparable harm creates
a de facto bar to state court relief, it is of no consequence
whether there be a de jure bar.49 Under Pennzoil’s theory,
Texaco would have been required to pursue its Texas state
remedies until it was irreparably damaged merely to demon-
strate that those remedies were inadequate and untimely. Such
a requirement cannot be—and is not—the law.

49 This, of course, is not to suggest that the substantive constraints on
state court mandamus in Texas would not have amounted to a de jure bar in
this case. (See supra at n.9) They readily could have.

26

Nothing in Moore v. Sims, 442 U.S. 415 (1979), upon
which Pennzoil relies, is to the contrary. In Moore, this Court
explicitly reaffirmed that “extraordinary circumstances” render
Younger inapplicable when necessary to prevent “great, imme-
diate, and irreparable harm” to the federal plaintiff.5° No-
where in Moore does this Court suggest that a state procedural
scheme that is at best uncertain in its ability to grant relief to a
party faced with imminent irreparable injury provides “an
adequate opportunity to raise . . . constitutional claims”.5'

Contrary to, Pennzoil’s assertion, the Second Circuit did not
engage in “abstract and hostile speculations about the effective-
ness and timeliness of the state’s remedial system”. (JS 19)
Rather, the Second Circuit’s opinion rests on (a) the uncon-
troverted fact that “absent injunctive relief, enforcement of
Texas’ lien and supersedeas bond provisions would rapidly
produce a catastrophe of major proportions, causing substantial
harm te Texaco itself and to thousands of others throughout the
United States including stockholders, customers, and suppliers”
(A39); (b) the uncontroverted fact that when Texaco sought
federal relief on December 17, the company’s viability was
measurable in days; and (c) the uncontroverted fact that “[i]f
resolution of [Texaco’s] claims [was] to be effective, prompt
judicial action [was] essential; time [was] of the essence”
(A35).

It was in the context of these uncontroverted facts that the
Second Circuit correctly concluded that, given the exigencies
and imminent threat of Texaco’s destruction, the uncertainty52

50 442 US. at 432-33.

51442 U.S. at 430. This Court’s reliance in Moore (442 U.S. at 425-26
n.9) on Hernandez v. Finley, 471 F. Supp. 516 (N.D. Ill. 1978), summarily
aff'd mem. sub nom. Quern v. Hernandez, 440 U.S. 951 (1979), demonstrates
that a practical (albeit not de jure) bar suffices to suspend Younger. In
Hernandez, the state security statutes at issue provided for some process and
did not impose an absolute procedural bar to the federal plaintiffs raising their
constitutional challenge to the security statutes. 471 F. Supp. at 519. The
federal court found only that it was “uncertain”, “unlikely” and “ ‘more
theoretical than real’” that the state courts would ever address those
constitutional claims. /d. at 519-20. Based on that finding, the court held that
Younger did not apply, because the state procedures did “not afford a plain,
speedy, efficient and certain remedy for review of [the plaintiffs’}] federal
claim”. 471 F. Supp. at 520. Here, the security statutes provide for no process
and the only arguably available means of attacking their application was the
extraordinary remedy of mandamus, uncertain at best (see supra at n.9), and
not even suggested in Hernandez to be adequate. ( A36-37)

52 See supra at 4-5 & n.9.

27

of the state court mandamus remedy arguably available to
Texaco made that remedy inadequate. (A35-38) Only in the
rare case (such as this one) where uncertainty cannot be
tolerated does uncertainty equate to inadequacy.53

Pennzoil’s argument, when reduced to its essence, is that
Texaco was required to bear the risk of uncertainty and delay
within the Texas state court system—no matter how crushing
the resulting burden. That is not now—and should not
become—the law.

D. The Second Circuit’s Subject Matter Jurisdiction Hold-
ing Does Not Merit Plenary Review.

Relying principally on this Court’s decision in District of
Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983),
Pennzoil argues that, simply because Texaco could have made
its due process challenge in the Texas state courts, the federal
courts are ousted from subject matter jurisdiction over that
claim. (JS 7-8, 20-23) Nothing in Feldman (or any other case
Pennzoil cites) supports that remarkable contention.

53 Pennzoil cites a single Texas case— Pace v. McEwen, 604 S.W.2d 231
(Tex. Civ. App. 1980)—in support of its claim that Texas remedies would
have been adequate and timely. (JS 18 n.11) In fact, Pace shows just the
opposite. In Pace, the Civil Court of Appeals was able to exercise its
injunctive power because the relator had already perfected his appeal. /d. at
232. To have perfected an appeal in mid-December, Texaco would have had
to waive its new trial motion—which was timely filed on January 9, 1986, and
which, under Texas procedural rules (Tex. R. Civ. P. 324), was an absolute
prerequisite to preserving issues for appeal. Moreover, the judgment at issue
in Pace was for recovery of specific real property. 604 S.W.2d at 232. Texas
courts have no discretion with respect to the minimum bond for a money
judgment but are granted full discretion with respect to the minimum bond to
supersede a judgment for specific property. Tex. R. Civ. P. 364(c). Pennzoil
cites no case—and we are aware of none—in which a Texas court enjoined
execution of a money judgment, pending appeal, in the absence of a full
supersedeas bond.

Pennzoil further asserts that under Tex. Civ. Prac. and Rem. Code §
65.013, the trial court would have had power to stay enforcement of the
Judgment pending appeal. (JS 18-19 n.11) Pennzoil is wrong. The cases
construing the statutory predecessor to § 65.013 make clear that where an
opportunity for direct review of a money judgment exists, or where a
supersedeas bond has not been posted, an ‘njunction enjoining execution of
judgment will not issue. See Glenn v. Hollums, 73 S.W.2d 1068, 1071 (Tex.
Civ. App. 1934); Svoboda v. Alexander, 3 S.W.2d 423, 424 (Tex. Com. App.
1928).

28

Feldman reaffirmed the established proposition that a
federal district court lacks power to engage in “appellate
review” of a state court judgment. Under Feldman, a federal
court engages in such “appellate review” when it adjudicates
claims that a state court has already decided or that are
“inextricably intertwined” with—that is, seek modification or
reversal of—the state court’s decision.54

Feldman’s holding has no application here. As the Second
Circuit found, and as Pennzoil concedes, Texaco’s due process
challenge to the lien and bond provisions was never presented
to—far less adjudicated by—a Texas state court. (A21-22;
JS 2, 7-8, 20) Nor, as the Second Circuit held, is that claim
“inextricably intertwined” with the subject matter of any prior
state court decision. (A22-23) The only claim the Texas trial
court addressed was Pennzoil’s state law claim of tortious
inducement. The merits of that tort claim—and the trial court’s
disposition of it—have nothing to do with the reasonableness or
validity of application of the lien and bond provisions. Con-
versely, Texaco’s due process chalienge to those provisions does
“not call into question the validity of the underlying judgment”
of the Texas court. (A27) The validity of the Judgment is
something which is now being challenged on appeal in Texas
—an appeal made possible precisely because of the limited
federal relief granted below.55

54 460 US. at 476, 482-84 n.16, 486. The claims in Feldman illustrate
this narrow principle. In Feldman, two applicants for admission to the District
of Columbia bar, whom the highest court there had determined in a judicial
proceeding to be ineligible, asked the federal court to order the District of
Columbia appellate court to allow them to take the bar examination or to
admit them to practice. 460 U.S. at 468-69, 472-73. One applicant relied on
constitutional claims that had been raised and rejected in the local court. The
other applicant relied on claims that could have been, but were not, raised in
the local court. This Court held that both litigants’ claims were barred—the
former claims because they had been actually decided by the local court; the
latter claims because they were “inextricably intertwined” with the local
court’s decision since, if accepted, they would have required reversal of that
decision. 460 U.S. at 486-87 & n.18.

55 The short-lived and uncertain prohibition against enforcement con-
tained in Paragraph 7 of the Judgment in no way constituted a state court
determination with respect to the reasonableness or validity of the lien and
bond provisions as applied. As the Second Circuit noted, Paragraph 7 was
simply the product of a “consent” agreement between Pennzoil and Texaco.
(A7)

29

Pennzoil relies on this Court’s statement in Feldman that
“[ b]y failing to raise his [constitutional ] claims in state court a
plaintiff may forfeit his right to obtain review of the state-court
decision in any federal court”. (JS 22, quoting from 460 U.S. at
484 n.16) That misses the point. The forfeiture referred to in
Feldm:in can occur only when the constitutional claim seeks
modification or reversal of the state court decision. The claims
in Feldman plainly sought such reversal. The claims here
plainly do not.56

Pennzoil’s reliance on Huffman v. Pursue, Ltd., 420 U.S.
592 (1975), is also misguided. Pennzoil argues that, under
Huffman, state court defendants must raise in state court all
federal claims connected in any way with the state proceeding.
(JS 21-22) But Huffman was a Younger case, and its limitation
on the defendant’s choice of forum applies only where—unlike
here—the state proceeding implicates a “vital” Younger inter-
est. (See supra at 21-25) This Court’s decision in Moses H.
Cone Memorial Hospital v. Mercury Construction Corp., 460
U.S. 1 (1983), makes clear that that limiting feature of
Huffman cannot be ignored. In Moses, this Court reaffirmed
the “virtually unflagging obligation” of the federal courts to
exercise their concurrent jurisdiction without regard to the
pendency of the federal plaintiffs claims in a parallel state
action. 57

In sum, Pennzoil is wrong in contending that, so long as a
federal constitutional challenge can be raised in an on-going
state proceeding, that avenue is a litigant’s “sole recourse”.
(JS 20) As the Second Circuit correctly held, Pennzoil’s
argument turns “settled law” on its head. (A22)

56 For the same reason, Pennzoil is wrong in asserting that the decision
below is in “conflict” with the Fifth Circuit’s rulings in Hale v. Harney, 786
F.2d 688 (Sth Cir. 1986) and Thomas v. Kadish, 748 F.2d 276, 282 ( Sth Cir.
1984), cert. denied, 105 S. Ct. 3531 (1985). (JS 21 & n.13) In both those
cases, the federal court lawsuit asserted claims that sought modification or
reversal of a prior state court decision.

57 460 US. at 15. Far from supporting Pennzoil’s reading of Feldman,
Huffman actually undermines it. If Pennzoil were correct about Feld-
man—and it is not—this Court wasted its time deciding the abstention issue in
both Huffman and Juidice v. Vail, since there would have been no subject
matter jurisdiction over the Section 1983 claims in those cases to begin with.
For the same reason, under Pennzoil’s reading of Feldman, federal courts
would not have jurisdiction to make the res judicata inquiries mandated by
this Court’s decisions in Migra v. Warren City School Dist., 465 US. 75
(1984) and Haring v. Prosise, 462 U.S. 306 (1983).

-

30

CONCLUSION

Involved here is the validity of state security provisions
challenged, not on their face, but only as applied to “the unique
and extraordinary circumstances of this case” (A35) which
“are unlikely ever again to recur” (A50). The result of the
narrow ruling below is to assure that state judicial processes go
forward to completion, rather than being arbitrarily terminated
by interim and unnecessary enforcement of a judgment that is
neither final nor preclusive, that is still subject to corrective
review and reversal, and that raises serious questions under
both federal and state law. Moreover, the private party that is
here championing the local security provisions has conceded
that it in fact does not need security for its judgment, has
publicly threatened to use the local provisions to apply settle-
ment pressure so as to avoid any appellate review, and has
purported to “waive” the local provisions and replace them
with federal procedures.

Such a narrow and unusual case does not merit plenary
review. For the reasons stated above;-this Court should
summarily affirm the result below.

Respectfully submitted,

THOMAS D. Barr

Davip Boles

Max R. SHULMAN

FRANCIS P. BARRON
CRAVATH, SWAINE & MOORE
One Chase Manhattan Plaza
New York, N.Y. 10005
(212) 422-3000

CHARLES ALAN WRIGHT
727 East 26th Street
Austin, Texas 78705

WILLIAM F. BAXTER

SHEARMAN & STERLING

4 Embarcadero Center

San Francisco, California 94111

Of Counsel.

May 31, 1986

PAUL J. CURRAN
MILTON J. SCHUBIN
RANDOLPH S. SHERMAN
IRA S. SACKS
KAYE, SCHOLER, FIERMAN,
Hays & HANDLER
425 Park Avenue
New York, N.Y. 10022
(212) 407-8000

Attorneys for Appellee
Texaco Inc.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0119%3A03. Public record. Not legal advice.