US District Judge Lee Rosenthal of Houston said she would decide how much the bank needs to pay Occidental Petroleum Corporation (NYSE: OXY) in damages later after lawyers give more information about the losses incurred by the energy company’s so-called “rabbi trust,” which was used to pay certain executives.
Rosenthal said in a 38-page ruling issued Wednesday that the value of the trust’s assets was “$39.4 million less than it would have been if the stock had been sold as the parties had agreed.” The judge said that the final amount of damages could be higher because Occidental Petroleum Corporation (NYSE: OXY) says it won’t be able to invest the money it was hoping to get.
Wells Fargo & Co. (NYSE: WFC) didn’t say that the sale of shares didn’t go as planned. But the bank doesn’t agree with how it will affect its customer.
A message sent to Wells Fargo & Co. (NYSE: WFC) ‘s spokesperson has not answered immediately.
Court documents show that the bank agreed in December 2019 to sell 381,420 daily shares for a week starting on January 6, 2020, when each share was worth about $45 to $47. Records show that an employee who had never done a deal this big sold 381,420 shares in one day in January but did not sell any shares on three of the planned days.
By early March, each share of Occidental Petroleum Corporation (NYSE: OXY) was worth close to $11. On March 20, two months after the agreed-upon sale period had ended, the bank sold 1.1 million shares all at once. This drove the price of the company’s shares down to $9.98. The oil company had hoped to avoid this price drop by selling shares in stages that didn’t flood the market.
Rosenthal also turned down Wells Fargo & Co. (NYSE: WFC) ‘s attempt to put at least some blame on Occidental Petroleum Corporation (NYSE: OXY) and its custodial intermediary, which also botched parts of the planned share sale. The judge gave everyone until September 9 to say how she should move forward.
Occidental Petroleum Corporation (NYSE: OXY) v. Wells Fargo & Co. (NYSE: WFC), 4:21-1126, US District Court, Southern District of Texas, is the name of the case (Houston).
Featured Image : Megapixl © Imdan
