Troubles in Texas

Sharp, frequent and dramatic have been the family fights within Texas Corp., biggest independent oil company in the U. S. But nothing ever emerged for public inspection from Texaco's battle-torn board room until last autumn when Ralph Clinton Holmes, ousted as the company's chairman, gave Texaco's stockholders a flashback of internal tussles (TIME, Oct. 2). Mr. Holmes's heaviest fire was directed at John H. ("Jack") Lapham, chairman of the executive committee and one of three representatives of the Lapham family, whose meddling, said Mr. Holmes, always brought on unhappy boardroom scenes. The management's answer to Mr. Holmes was loaded with such epithets as "domineering . . . arrogant . . . intolerant . . . arbitrary . . . unreasonable . . . impatient . . . resentful . . . surrounded by the fog of his own egotism." Finally a stockholders' committee acceptable to both Mr. Holmes and the management was appointed to investigate Mr. Holmes's charges. Last week the committee published its report. Though the committee whitewashed no one, it backed up embattled Mr. Holmes more often than not. It endorsed his chief demand--broader stockholder representation, fewer officer-directors--and bluntly told the Lapham family that its holdings entitled it to one director, not three. It urged the company to hire an "executive of outstanding experience and proven ability," recommended that Jack Lapham be ousted as chairman of the executive committee for lack of practical oil knowledge. It criticized the bonus plans (lately dropped) and loans to employes and officers (including Mr. Holmes). It took the management to task for spending company funds in its counterattack on Mr. Holmes, for using company employes to drum up proxies. But, said the committee, "such antagonism has developed between Mr. Holmes and the operating executives that his re-election as a director is undesirable and unwise."

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