Cases & Deals

Chevron and Unocal successfully resolve antitrust class actions regarding reformulated gasoline

Client(s) Chevron Corporation

Jones Day defended Union Oil Company of California, together with parent corporations Unocal Corporation and Chevron Corporation, in 14 federal (MDL) and state court class actions, all of which were patterned after a March 2003 FTC administrative complaint (i.e., FTC Docket No. 9305). Like the FTC, the consumer plaintiffs alleged misconduct arising from Union Oil's lobbying activity before the California Air Resources Board ("CARB") during the course of its 1991 rulemaking for low-emission or reformulated gasoline ("RFG") standards. The plaintiffs claimed that Union Oil wrongfully failed to disclose to the CARB that it was prosecuting a patent related to low-emissions gasoline at the time it advocated that CARB adopt certain fuel standards. Eventually, after RFG standards were imposed on California refiners by the CARB, the U.S. Patent Office issued 5 separate RFG patents to Union Oil, the first of which Union Oil successfully litigated to a jury verdict finding validity and infringement. That 1997 verdict (and the jury's damage award) was upheld by the Court of Appeals for the Federal Circuit, and certiorari was denied by the United States Supreme Court. Although the 5 patents later were terminally dedicated and deemed unenforceable in order to obtain the FTC's approval of Chevron's acquisition of Unocal in August 2005 (along with settlement of its administrative complaint), plaintiffs sought over $10 billion in past damages and restitution for amounts they claimed represented retail price increases of RFG during the class period and amounts received by Union Oil from the enforcement of its initial RFG patent. With a potentially dispositive summary judgment motion pending, the parties agreed to a $48 million cy pres settlement fund, which was approved by the District Court in November 2008.

In re Reformulated Gasoline Antitrust and Patent Litig., MDL No. 05-1671 CAS (C.D. Cal.)