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The U.S. Supreme Court on Thursday handed a victory to 11,000 small gas station owners and their Miami attorneys in the longstanding class action battle against ExxonMobil Corp. The high court ruled 5-4 that the station owners in Florida and 34 other states were properly included in a single class action in U.S. District Court in Miami. The high court rejected the oil giant’s request for a new trial. As a result, Irving, Texas-based ExxonMobil will have to pay out more than $1.3 billion in damages. Exxon argued that the case shouldn’t have included station owners who were seeking less than $50,000, which at the time was the threshold for certain types of stand-alone federal suits. Justice Anthony Kennedy, writing for the court, said the trial judge, U.S. District Judge Alan Gold in Miami, properly exercised “supplemental jurisdiction” over those claims because they were attached to larger claims. Chief Justice William Rehnquist and Justices Antonin Scalia, David Souter and Clarence Thomas joined Kennedy in the majority. Justices John Paul Stevens, Stephen Breyer, Ruth Bader Ginsburg and Sandra Day O’Connor dissented. “We are disappointed by today’s Supreme Court decision,” a company representative said. “This case has never been clear cut, as demonstrated by the fact that five justices in the United States Supreme Court held in favor of the plaintiffs while four justices thought Exxon was right.” The ruling hardly puts an end to the complex case, which started in 1991. Now, Miami-based Stearns Weaver Miller Weissler Alhadeff & Sitterson, which has had four attorneys assigned to the case, most likely will spend years working to see that the nearly 11,000 claims are paid. “That’s twice as many claims as exist now in the Southern District,” said Eugene Stearns, a partner at Stearns Weaver and lead counsel on the case. “We expect ExxonMobil will fight every single claim. They will make it as difficult and expensive as they can.” Stearns said the firm already has invested $40 million in the case, in time and costs. In addition, another big fight could involve attorney fees in the case, which could top $200 million. Fee requests, which are due in August, will be capped at one-third of damages, Stearns said. His firm, which has been lead counsel on the case for 8 1/2 years, is expected to get the bulk of the fees. But one out-of-state attorney, Gerald Bowen of Virginia, already has requested — and been refused — liens on client damages to pay his emergency attorney fees. Another firm, Pertnoy Solowsky & Allen of Miami, perhaps expecting a battle, initially asked Gold to seal attorney fee requests in the case. Pertnoy said the firm has withdrawn its request. “I’m sure Judge Gold in his wisdom will decide the proper payment for the attorneys,” Pertnoy said. “I don’t expect a fight.” The case centered on Exxon’s August 1982 discount-for-cash program, which promised station owners a price cut for gas to offset a new credit card fee the oil company was charging them. The station owners alleged that Exxon, which later merged with Mobil, eliminated the price discount seven months later, yet for years continued to tell stations that it was providing the discount. After a 2001 federal court trial in Miami, jurors found that Exxon had secretly overcharged its dealers for gas for more than 12 years, and held the company liable for fraud and breach of contract. The jury found that Exxon failed to reduce its prices by about 1.3 cent per gallon as promised. Based on the 40 million gallons of gas sold during the 12-year program, the jury awarded $500 million to the station owners. With interest, the damages are expected to top $1.3 billion. ExxonMobil appealed the verdict unsuccessfully. In May, the case was back before Gold, and he clearly was frustrated with the oil company. He ruled that ExxonMobil “knowingly and recklessly” filed frivolous litigation and acted in bad faith to delay paying the gas station owners. “Sanctions are warranted because of [ExxonMobil's] scheme to deliberately misuse the judicial process to chill the class dealers’ legitimate claims,” Gold said. ExxonMobil denied those charges. Stearns called Thursday’s Supreme Court ruling “anti-climactic.” That’s because the ruling only dealt with the limited question of whether the trial court had jurisdiction over individual class member claims worth less than $50,000. Claims for less than $50,000 represent 7 percent to 10 percent of the $1.3 billion, Stearns said. Exxon’s Supreme Court argument went beyond that segment, however, as the company argued that the inclusion of the smaller claims tainted the entire proceeding and necessitated a new trial. “We expected a positive outcome,” Stearns said. “We were optimistic. This ends a potential obstacle to the claims process.” Still, the litigators and their secretaries celebrated at lunch, and a firmwide celebration with champagne was scheduled for after hours. Before the Supreme Court ruling, Gold already had set up a claims process by which station owners could file claims, and had appointed former U.S. District Judge Thomas Scott as special master to administer the claims. The class representatives already have been paid. Despite the ruling, ExxonMobil’s share price rose 43 cents to $60.10 by early Thursday afternoon in New York Stock Exchange composite trading. This report was supplemented with reporting by Bloomberg News.

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