Wells Fargo & Co. bungled the 2020 sale of Occidental Petroleum Corp. shares on behalf of an employee trust, a judge in Texas ruled. Because the bank failed to execute trades as planned before the Covid-19 pandemic tanked the stock market, the trust experienced tens millions of dollars in losses.
U.S. District Judge Lee Rosenthal of Houston said she will decide later how much the bank must pay Occidental in damages, after lawyers provide more detail on losses suffered by the energy company's so-called "rabbi trust," which was used to compensate certain executives.
The value of the assets held in the trust was "$39.4 million less than they would have been had the stock been sold according to the parties' agreement," Rosenthal said in a 38-page ruling handed down on Wednesday. The judge indicated the final damage award may be higher because Occidental claims it lost the opportunity to invest the cash it had hoped to receive.
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