John K. McKinley, the chief executive officer who tried to resuscitate Texaco Inc. before a jury asked it to pay a then-record $10.53 billion in damages as part of a lawsuit that led to the biggest US bankruptcy, has died. He was 94.
He died June 12 at his home in Dallas, according to a paid notice in The New York Times. No cause of death was given.
The Alabama-educated chemical engineer had a 45-year career at Texaco, the nation’s third-largest oil company at the time, when it lost the case against Houston-based Pennzoil Co. over the acquisition of Getty Oil Co. The Texas jury’s award was the largest in US history. Mr. McKinley was chairman and chief executive from 1980 until he retired in 1986.
Mr. McKinley invested billions of dollars in exploration and closing refineries and service stations, while cutting jobs at the White Plains, N.Y.-based company, according to The New York Times. He humiliated executives in front of their peers and was dreaded by underlings, according to Fortune magazine.
‘‘I may be interpreted as asking harsh questions, but I don’t mean it that way,’’ Mr. McKinley said in Fortune. ‘‘If people are afraid of me, it’s because of fear of their own inadequacy.’’
In the biggest US corporate legal case at the time, Texaco struck a 1984 deal to buy Getty for $10.1 billion after Pennzoil, formed from a company cofounded by George H.W. Bush, claimed it had a prior agreement to buy Getty.
Pennzoil, valued at about $1.5 billion before the dispute, filed a lawsuit seeking $15 billion in damages from Texaco.
In 1987, Texaco filed for bankruptcy with $34.9 billion in assets, according to a Times story. It was then the largest US bankruptcy. After a reorganization, the company emerged from court protection in 1988. With the help of corporate raider Carl Icahn, who had acquired a 12.3 percent stake in Texaco, it reached a settlement to pay Pennzoil $3 billion.
John Key McKinley was born in 1920, in Tuscaloosa, Ala. His father, Vergil Parks McKinley, was a college professor and his mother, Mary Emma Key McKinley, was an elementary school teacher.
He earned a bachelor’s degree in chemical engineering at the University of Alabama and a master’s in organic chemistry.