by Coll, Steve;
In a characteristic act of courage or bravado, depending on how one looked at it, Dick Miller had elected not to put on any rebuttal testimony about damages during Texaco’s defensive case. He felt that damage rebuttal only weakened his case, since by arguing for lower damages Texaco would inevitably seem to be conceding some culpability. Miller felt that the cross-examination of Barrow, which had been handled by Richard Keeton, had been so effective that the jury would never accept any of the witness’s three models. The huge numbers involved did not daunt Miller; after all, he had been retained for his ability in the “bet-your-company” genre of civil litigation.
Neither were Texaco’s top executives unduly concerned about the lack of damage rebuttal. Jim Kinnear had conducted extensive research designed to attack the assumptions made by Barrow, but his work was employed only in Keeton’s cross-examination, not in Kinnear’s own direct testimony. Chairman John McKinley said later that he was only following the advice of his attorneys, but since he shared many of Miller’s “manly” attributes, the argument that damage rebuttal only contributed to the appearance of weakness likely held an emotional appeal as well. McKinley said later: “The advice we got was, ‘Look, you don’t owe them anything, and it is a poor tactic of law to present damage testimony because then people start looking in between the two numbers for a compromise figure.’ Plus, as we came down to the end of the trial, we had a new judge pressuring us to finish quickly.… Any fair judgment would recognize that their damage claim was in defiance of common sense, we thought.” Miller had developed a countertheory to the damage models argued by Barrow—that Pennzoil was entitled only to the value of the stock it sought to purchase, not the oil and gas assets conveyed by ownership of the stock—and he tried to have this theory included in Judge Casseb’s jury charge.
“Their contract was to obtain stock,” Miller’s partner J. C. Nickens argued to the judge. “And if they were deprived of the bargain of that stock, then they were deprived of the difference of the value of that stock on the date they were to acquire it and what they would have paid for it.” That bottom line, Texaco had calculated, was only about $500 million. But Joe Jamail told Casseb, “The test is that the jury may make a reasonable estimate of the damages based on all relevant data, the expert testimony, including opinion evidence,” and once again, Pennzoil prevailed. The charge reflected Jamail’s position.
Texaco’s top executives were staying at the Four Seasons Hotel in downtown Houston on the day the final charge was delivered to both parties. When Miller brought it to the Texaco suite, the mood for the first time was one of deep discouragement and concern. Kinnear thought the charge “was obviously a directed verdict for Pennzoil.” Miller, too, was upset, but he again expressed to his client that “he felt very strongly that it was going to be all right,” as McKinley later put it.
If the Texaco executives could not fully appreciate that the charge memorialized Joe Jamail’s populist, moral view of the issues at trial, they had only to wait for the closing arguments for confirmation that Pennzoil and Texaco were presenting to the jury starkly different ideas about the significance of the taking of Getty Oil Company.
The closing arguments began on Thursday morning, November 14, 1985. Each of the three Pennzoil lawyers handled a section of the argument; it was characteristic of Miller’s approach to trial work that only he spoke for Texaco. Jeffers and Terrell spoke first, then Miller. Under Texas rules, Joe Jamail would have the final word before the jury.
Jeffers, the cerebral orator, spoke mainly about contract issues and damages. It was Terrell who struck up in earnest the relentless themes first framed by Joe Jamail during voir dire four months before.
“You’re going to be able to do something that I, in my lifetime, will never be able to do as a lawyer,” Terrell told the jurors as he stood behind a lectern a few feet from the box. “You will decide the ethics. You will decide whether you can go out and take somebody else’s deal just because you’re bigger and stronger, you’ve got a lot of muscle, you’ve got a lot of lawyers, you’ve got investment bankers. And above all, what have you got? You’ve got indemnities.
“These people do these things and they have no personal responsibility. And I’m telling you that if you speak out, they will hear you. Not just these men—they’ll hear you for sure—but the whole business community. But if you don’t care about the way corporations treat each other, and I know there are people who believe in that, then you don’t have to do anything.”
Terrell centered his attack on Lipton and Boisi, referring to them by name more often than to Texaco’s executives. He reiterated Pennzoil’s argument that Texaco was wholly responsible for the conduct of its Wall Street witnesses because it had provided them with legal indemnities. “Lipton is a man who not only is proud of the fact that he got this higher price and he got protection for his client, this indemnity, but he wants to sit here and tell you that Arthur Liman’s been his friend for twenty-five years,” Terrell said. “Mr. Liman, before Mr. Lipton testified, he spoke of Mr. Lipton as his friend. But if ever somebody denied somebody three times, that was it. Lipton did, to Liman. I mean, you take your pick between these two men. I know who I believe.” And about Boisi: “Now if you believe that Geoff Boisi made ‘courtesy calls’ on the fourth and fifth, we need to talk about a car I’d like to sell you because it’s just incredible.”
Terrell ended with a plea suggestive of a call for class revolt, as if the trial of Pennzoil v. Texaco had been a microcosm of some struggle for liberation by ordinary Americans against their ruling class. “It doesn’t matter what is in this charge that you have in your hands unless you do something with it. It’s yours to use or not use,” he said. “I suggest to you that you use it so that everybody, whether we’re a big deal oil company or a medium-sized oil company, whatever kind of person we are, whether we’re the chairman of the Philadelphia museum board of arts or whatever, that we all live by the same rules, that we’re responsible for our actions. And that’s all I have to say. Just don’t let them get away with these indemnities. Please don’t. Thank you.”
After a fifteen-minute break, Dick Miller took the floor. Watching his former mentor pace before the jury in characteristic fashion, Irv Terrell, who had been exceedingly nervous during his own argument, thought that Miller, too, appeared to be tight as a drum. That afternoon, Miller quoted Justice Oliver Wendell Holmes and Sherlock Holmes and then confused the two. He told a story about Alice in Wonderland. The next morning, Friday, when Miller continued his argument, he corrected his confusion of the two Holmeses and told the jury that his partners had “pointed out to me I ought to get to the point and ought to quit acting like I know everything.”
When Miller was composed, however, he was impressive. His argument contained two separate threads. First and foremost, he argued that there simply was no contract between Pennzoil and the Getty Oil directors, and that there certainly was no interference from Texaco. “We did not crash this party,” Miller declared. “We were invited to the party. We didn’t look them up. They looked us up.… This has got to be the first case in the history of mankind where the white knight got sued by the dragon. And that’s just exactly what happened.”
But Miller also sensed that he had to somehow rebut the urgent moral pleadings of Jamail and Terrell. At times, he did this by rejecting outright their contention that anything important was at stake in the case. “It’s got to be one of the dullest cases that’s been tried,” he said, adding that the “most exciting thing in the case was when I came into the courtroom with my fly unzipped.”
At other times, though, Miller returned to the earlier themes he developed during his emotional cross-examination of Hugh Liedtke, arguing that if anyone was a villain in the deal, it was Pennzoil. “It’s a company run by lawyers who know a lot about this business, who understand takeovers and who understand power and the force of money and the sense behind the attack and who, as they looked at the saga of the Getty Oil Company unfolding, could see,
could sense the weakness of that company and the fact that its leadership was in disarray because of this internal dispute—and who were willing to take advantage of it, saying, ‘There’s an opportunity there for us.’”
Miller also defended the integrity of Lipton, Winokur, and especially Boisi, pointedly accusing Terrell of cowardice because he attacked the banker’s integrity when Boisi was absent from the courtroom. “I can’t believe that anybody who saw that guy, who saw him testify, could do anything except believe him,” Miller declared.
“They didn’t have a contract,” Miller closed, “never had a contract, and what they have got is a company that’s run by three lawyers who have got this lawsuit and they are trying to hit a big gusher here in court. That’s what this lawsuit is about.”
After a break for lunch, Joe Jamail rose to conclude Pennzoil’s presentation. At the Pennzoil counsel table, and in the first row behind it where Hugh Liedtke, Baine Kerr, and other Pennzoil executives sat, there was a keen sense of excitement and anticipation. Alone before the jury, with no witnesses or objections or documents to soften the impact of his brawling, muckraking, ebullient personality, Jamail was at the peak of his powers. He hauled the lectern right over to the jury box, so that he was almost in their laps.
Miller had used the word “contract” throughout his closing argument, attempting to mitigate the effect of the wording in the charge, but Jamail turned immediately to the issue. “For Mr. Miller to stand here and attempt to change the court’s charge, the wording in it, by inserting things that he likes, is typical. It’s what they’ve done from the beginning of the case.”
“Judge Casseb is one of the most honored and brilliant judges in America. If he had wanted to say to you, ‘contract,’ he would have said it.”
“Miller,” Jamail went on, “told you a lot of old lawyer’s stories. I hope I don’t take up your time doing that. I will tell you a lawyer’s truism, though: ‘When the law is on the lawyer’s side, he talks about the law. When the facts are on the lawyer’s side, he talks about the facts. When he has neither, he just talks—and I guess tells Alice in Wonderland stories.”
In its specifics, Jamail’s argument essentially ignored Texaco, concentrating instead on the trio of witnesses Miller called to the stand at the opening of his defensive case. He began with Winokur. “You remember him, ‘Back Door’ Bart?” Jamail asked the jurors. “Snuck in the back door when they got Gordon Getty out of the room? Kicked him off or tried to instigate a lawsuit to kick him off the board of trust of his own family trust? Instigated, funded a lawsuit to remove or in the alternative to appoint a cotrustee who could dominate him. That’s really good faith and that’s a lot of fiduciary.
“They really laid a whole lot of fiduciary on Gordon Getty. And that’s what you are dealing with. And he stands here and wants to talk about morality? Not today.”
Warming visibly, Jamail quoted Lipton’s testimony about the “different standard” in the lawyer’s mind between a multibillion-dollar deal and a contract between “ordinary” people and then turned the issue into a broad attack on merger lawyers and investment bankers, whom Jamail openly characterized as conspirators against the people. “That’s the specialized group you had to deal with that would have injected themselves into our business community and into our law, calling themselves merger and acquisition lawyers, carving up corporate America to their liking. And nobody loses. Those investment bankers and the lawyers that comprise the merger and acquisition field, they get together. They’re all within a couple of miles of each other. One wins one day and another wins another day, and the investment bankers win all the days—and they win with these indemnities.… You can send a message to corporate America, to the business world, because it’s just people who make up those things.
“It isn’t as though we are numbers and robots. We are people. And you can tell them that you are not going to get away with this.… I know you are going to do the right thing. You are people of morality and conscience and strength. Don’t let this opportunity pass you.”
And with that, Joe Jamail turned and walked back to his counsel table. The trial of Pennzoil v. Texaco was finished. No one in the courtroom—not Jamail, not Miller, not John McKinley, not Hugh Liedtke—knew how the twelve jurors felt about their four-month ordeal, or whether they cared at all about the two huge oil corporations that had taken them away from their jobs and even their families for week after monotonous week of testimony and argument. What had taken months and millions of dollars in legal fees to present would now require just hours to decide. The lawyers and clients on both sides told each other that they trusted in the jury’s fairness and wisdom. It was what they had to believe. There was no other choice.
31
Citizens
When the Door to the jury deliberation room was closed that Friday afternoon, the feeling inside was volcanic. Week after week, month after month, through moments of high drama and passages of unspeakable tedium, the twelve jurors had been proscribed from discussing the trial among themselves. They had followed this order more or less exactly. Between the women, there had been talk during the trial about which lawyer or witness was the best-looking (Marty Siegel, who testified by videotape, was the witness who garnered the most approval; Dick Miller led the lawyers), and between the men, there had been similar contests concerning the women in the courtroom, although there were fewer candidates for them to choose from. But although they had been thrown into intimate contact with one another, the jurors had never been able to openly discuss the trial. They knew all about each other’s personal lives: children, spouses and ex-spouses, job stresses, births and deaths. They knew each other’s personalities, habits, and eccentricities. But none of them knew how the others felt about the long, emotional trial they had witnessed together.
Now, suddenly, they could talk. Feelings and words exploded. Everyone was speaking at once; some of them were crying, some laughing. There was so much to be said, so much to be shared, it seemed at first that it might take days just to settle everyone down.
Among the twelve jurors, there were eight whites and four blacks, and at least one of the white jurors had been concerned going into the deliberation room that this might be a factor in the discussions ahead. There had been some tension on the jury during the last weeks of trial. It had begun when Judge Casseb took over the case and vowed to speed up the pace of the proceedings. His first step was to eliminate the half-day holidays on Monday mornings and Friday afternoons which had been established at the beginning by Judge Farris. Farris had instructed the jurors to schedule all of their pressing personal appointments, with doctors and dentists and so on, during those half-days; no other time off would be granted. When Casseb took charge and eliminated the holidays, some of the jurors had outstanding appointments which had been scheduled during Farris’ reign. Casseb said that he was sorry, but he could not permit any more holidays. Then Theresa Ladig, a single parent, had asked Casseb if he would recess the trial early on Halloween so she could take her boys trick-or-treating, as she had promised them, and Casseb agreed. A few days later, one of the two black women on the jury asked permission to attend a parent-teacher conference at her children’s school. But Casseb said no. The black woman complained to the other jurors that Casseb was prejudiced, that he had favored Theresa’s request over her own for racial reasons. Thereafter, the once cordial, if hardly intimate, relations between blacks and whites on the jury had been infused with tension. An emotional and difficult subject had been broached. There was no open bickering or arguing between the jurors—after all, it was Casseb, not Theresa Ladig, who was accused of prejudice—but there was a new discomfort among them, a sense that sides had been taken.
Some of the white jurors perceptively attributed this racial tension to the emotional exhaustion and frayed nerves that they recognized in themselves after so many months of trial. But during those first moments in the jury room, there was unspoken concern about whether the issue would shape the deliberations.
An early vote was taken on the threshold issue of whether or not there had been a contract, or “agreement,” as the charge put it, between Pennzoil and the Getty Oil directors. The vote was 7–5 in Pennzoil’s favor. All four of the blacks, and one white woman, a bookkeeper named Susan Fleming, voted for Texaco. Given the tensions during the last weeks of trial, the sharp racial division in the vote seemed ominous. Israel Jackson and Ola Guy, two of the black jurors, announced promptly that they did not believe there was a contract and that they weren’t going to change their minds about it, either. They said that they really didn’t want to discuss it.
In the election of the jury foreman, an effort had been made to diffuse the racial issue. Jim Shannon, a white public relations specialist who worked for the city of Houston, nominated Fred Daniels, a black postal worker, to be foreman. Daniels, a quiet man who sometimes passed out flyers advertising events at his church to the other jurors, was elected by acclamation but declined to serve. Still, to some of the white jurors, the gesture seemed to have an effect; Daniels was the first to change his vote to Pennzoil’s side, and the only one to do so that Friday afternoon. Next, Shirley Wall, an older white woman who had been popular with many of the jurors during the long months of trial, was nominated to be foreman, and she, too, was elected by acclamation. She also declined to serve, however, citing her fear of public speaking. Finally, Richard Lawler, a white, thirty-one-year-old salesman of heavy industrial equipment and a man of even temperament and obvious leadership ability, was nominated, and he agreed to take the job.