nd possibly also with respect to IPC's efforts to exclude competitors. Without in any way attempting to examine these charges in an international adjudication would not likely to be beneficial either Britain, France, and the United Statesâ€¦..
A fairly substantial case could be made (particularly in an arbitration) that IPC has followed a "dog in the manger" policy in Iraq, excluding or swallowing up all competitors, while at the same time governing its production in accordance with the overall worldwide interests of the participating companies and not solely in accordance with the interests of Iraq. This of course has been one of the principal charges of the government of Iraq against IPC.
The memorandum concluded by stating: "While the legal issues in the IPC-Iraq dispute are numerous and complicated, law does not appear to provide solutionsâ€¦â€¦.IPCs legal remedies are few, and we have no firm legal basis for telling independent American companies – let alone foreign companies – to stay out of Iraq.
State Department Pressure On Independents
Although lacking a "firm legal basis," top State Department officials were in fact exceedingly active in telling independent American companies to "stay out of Iraq," both before and after the submission of the legal memorandum. For example, on May 6, 1964, Governor Averell Harriman and other State Department officials met with E. L. Steiniger, chairman of the Board of Sinclair Oil Company, one of the largest companies without a Mideast concession. According to the Department's Memorandum of Conversation, Governor Harriman said that: "In the IPC case proved and probable reserve areas were taken away. We wonder whether it is wise for U.S. oil companies to approve this type of action which the same companies condemn in other parts of the world. . . . We hope you will not take any action which will appear to condone unilateral acts." In reply, Mr. Steiniger cited other instances (Peru, Argentine) in which Sinclair "had refused to enter the petroleum picture since this would be to the detriment of an existing concessionaire," but he went on to refer to the danger that in Iraq "foreign companiesâ€”German, Japanese and Italianâ€”would acquire concessions shutting Sinclair out." Governor Harriman replied: "We could not wish governments, such as Iraq, to get the impression that American oil companies can be pushed around." In return Mr. Steiniger alluded to the Achilles' heel of IPC's case: "Sinclair was not interested in taking proven areas which IPC wishes to exploit but Sinclair understands that many favorable areas in Iraq were drilled by IPC and then abandoned." Governor Harriman closed the meeting by suggesting that Sinclair "hint to the Iraqis that its offer is affected by what takes place between the GOI [Government of Iraq] and IPC." There is nothing in the record to indicate whether Steiniger conveyed this suggestion which, if accepted by the Iraqis, would have ruined his own changes of securing a concession.
Two weeks later, a similar meeting was held between Ambassador Jernegan of the State Department and James Richards of Standard Oil of Indiana, another large company lacking a Mideast concession. It would appear from the Memorandum of Conversation that this company (formerly a part of the old Standard Oil "Trust") evidenced a greater spirit of cooperativeness: "Standard of Indiana, he [Richards] said, has been very careful not to appear to do anything until it is clear that the company's action would not be infringing on the rights of another company. Ambassador Jernegan replied, â€˜That's what I wanted to hear you say.' He noted the worldwide repercussions which would emanate from Iraq's getting away with expropriation of IPC's concession territory, particularly if other American companies reached agreement with the Iraq Government prior to an IPC-GOI settlement. The ambassador was assured that â€˜Standard of Indiana would do no such thing.'"
By early July, the Department was able to report that it had successfully "interceded with all American companies which to its knowle