Verdicts & Settlements January 13, 2009: Shell Oil to pay $66M to royalty owners
Tuesday, January 13 2009
It took nearly four decades, but an Oklahoma jury ordered Shell Oil Co. to pay $66 million to five royalty owners (several of them deceased) for their share of a lucrative oil well dug in the early-1970s. The payments will go to two families who owned the land where Shell drilled for oil but were never informed when the company struck a huge reserve and built a well on the land in 1973.
Time was not an ally for plaintiffs' attorney Randy Calvert, given that it took 20 years for his clients to even realize there was a well. Once they finally filed a complaint in 1995, Shell and then-lease owner Maynard Oil Co. switched counsel and dragged their feet on the case.
"Shell told us [in 1995] that if we didn't want to accept a nuisance value settlement, they would drag the case out and my clients would be dead before they ever got the money," said Calvert. "They ended up being partly right."
Three different judges later, Shell based its defense on a statute of limitations theory. To defeat that defense, Calvert had to show Shell's breach of fiduciary duty was not a mistake, but a deliberate attempt to keep his clients in the dark.


