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Cline v. Sunoco, Inc. Civil Action No. 6:17-cv-313-JAG
Oklahoma
the Court agreed with Sunoco that it caused economic, not physical, harm to the plaintiff. However, Sunoco’s practice of “paying statutory interest” only after the roy- alty owner demanded it amounted to an enormous loss for the public. Although Sunoco may have “acted on the advice of counsel,” and Sunoco’s practice “was consistent with the industry practices,” its conduct clearly violated the PRSA and kept millions of dollars that belonged to others. Finding that Sunoco’s position that it could keep other people’s money indefinitely was reprehensible, the Court did not find that it erred in issuing the punitive damages award and declined to alter or amend the judg- ment. The Court further denied the renewed motion for a new trial and motion to alter the judgment made by Sunoco in November 2020 and the Order was issued on December 9, 2020.
In a decision handed down on December 9, 2020, US District Court Judge John A. Gibney, Jr. denied Sunoco’s motions for a new trial and to alter the August 2020 judg- ment. The Oklahoma Production Revenue Standards Act (“PRSA”) requires a first purchaser of crude oil, such as Sunoco, to pay proceeds promptly for the oil. If the purchaser pays late, it must pay interest to the owner of the well that produced the oil. On December 10, 2019, the Court concluded that the PRSA requires Sunoco to make statutory interest payments automatically with late payments. Perry Cline is the named representative of a class certified by the Court on October 3, 2019. In August 2020, the Court announced that Sunoco breached its obligation under the PRSA to pay statutory interest on late payments it made on oil proceeds. Accordingly, the Court entered judgment against the company, found for Cline and awarded actual damages in the amount of $80,691,486 and punitive damages of $75,000,000. On September 24, 2020, Sunoco filed two motions: one for a new trial and one to alter the judgment. In its argument that the punitive damages award is “excessive”, Sunoco contended that its “conduct was not reprehensible under the Supreme Court’s standards”. Regarding the “degree of reprehensibility of the defendant’s conduct”,
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