press release

Chevron Press Release - Chevron To Appeal Cities Service Award

SAN FRANCISCO, July 18, 1996 -- Chevron Corporation announced that Chevron U.S.A. Inc. will appeal today's verdict by a Tulsa, Okla., jury in a 14-year-old breach of contract lawsuit. The judgment includes $228.9 million compensatory damages, and interest estimated at more than $500 million. The jury rejected Cities' claims that Gulf's actions constituted a malicious breach or fraud.

"We are very disappointed in the verdict, but not surprised, given the numerous errors in the judicial process," said Ken Derr, chairman and chief executive officer of Chevron Corp., the parent company of Chevron U.S.A. Inc. "The jury was prevented from hearing critical evidence that would have exonerated Gulf Oil Corp. and, by extension, Chevron. The judge took many decisions out of the jury's hands, including the amount of compensatory damages to award the plaintiff.

"We believe the Oklahoma appellate courts will not permit this miscarriage of justice to stand," said Derr.

The lawsuit was filed in 1982 by Cities Service Co., a Tulsa oil company, against Gulf Oil Corp., when Gulf terminated plans to acquire Cities Service. In the years since the suit was filed, both companies were acquired by other energy firms: Cities Service by Occidental Petroleum and Gulf by Chevron Corp. The lawsuit remained in the names of the original parties.

Updated: July 1996