US Court of Appeals Affirms Jury Verdict in Favor of Gas Station Owners

Business Wire, April 24, 2008

BOSTON -- The First Circuit Court of Appeals on Friday affirmed the 2004 jury verdict awarding $4.5 million in damages and fees to eight gasoline station franchise operators who claimed that Shell Oil Company and Motiva Enterprises intentionally overcharged them on the wholesale price of gasoline and rent on their stations in order to force the franchisees out of business and permit Shell to take over operation of their stations. The law firm Greenberg Traurig LLP, which represents 60 Shell-branded franchise operators in Massachusetts, New Hampshire and Rhode Island - argued the case on behalf of the eight dealers. The claims of the remaining dealers have yet to proceed to trial.

"We are very pleased that the Court of Appeals upheld the overwhelming portions of the jury's verdict," said Gary Greenberg, co-managing shareholder of Greenberg Traurig Boston and one of the attorneys for the plaintiffs.

"This is a precedent-setting decision," said Jay Farraher, another member of the Greenberg Traurig team of attorneys. "The First Circuit Court of Appeals is one of the only appellate courts in the country to have held that dealers have the right to challenge the wholesale price where dealers feel there is evidence that the oil company may not be acting in good faith."

Under the terms of the parties' franchise agreement, Shell unilaterally set the wholesale price charged to the dealers for gasoline. The dealers claimed that Shell, and Motiva Enterprises, a joint venture between Shell and Saudi Refining Inc. that refines, distributes, and markets oil products in the eastern and southern U.S., charged them wholesale prices that would not permit the dealers to compete in the marketplace.

On December 8th, 2004, after a three-week trial, a unanimous jury found in favor of the eight franchisees and awarded them more than $4.5 million in damages and fees. Shell Oil Company appealed the jury's verdict to the United States Court of Appeals for the First Circuit. On April 18th, 2008, the Court of Appeals affirmed all but one of the dealers' claims and confirmed the jury's determinations.

Greenberg Traurig, LLP is an international, full-service law firm with more than 1750 attorneys and governmental affairs professionals in the U.S., Europe and Asia. The firm was selected as the 2007 USA Law Firm of the Year by Chambers and Partners.