In a landmark decision, energy giant Phillips 66 has been hit with a $604.9 million verdict after a California state court jury ruled in favor of biofuel maker Propel Fuels. The jury found that Phillips 66 misappropriated Propel’s trade secrets to boost its own renewable fuel capabilities, marking a significant victory for the Sacramento-based biofuel innovator.
The Oakland jury agreed that Phillips 66, headquartered in Houston, had improperly acquired Propel’s confidential information under the guise of a potential acquisition. Propel claimed that the energy company approached them in 2017, expressing interest in a deal to enhance its renewable fuel business in California, a state that offers incentives for low-carbon fuel alternatives. However, after backing out of the acquisition in 2018, Phillips 66 went on to launch its own renewable fuel business the following year, allegedly using Propel’s proprietary strategies and financial data.
A spokesperson for Propel Fuels confirmed the award, describing the verdict as a significant step toward holding Phillips 66 accountable. Propel, a leader in low-emission gasoline and diesel production, had filed the lawsuit in Alameda County in 2022, accusing Phillips of leveraging their trade secrets to dominate California’s lucrative renewable fuel market. According to Propel’s legal filings, prior to obtaining confidential information from Propel, Phillips 66 had neither produced nor sold any renewable fuel, and had little knowledge of the business.
“Phillips 66 is making a multibillion-dollar investment in the California renewable fuel market, based on Propel’s trade secrets,” Propel said in the lawsuit.
While the ruling represents a significant blow to Phillips 66, the company has expressed its disappointment with the outcome. A spokesperson for the company stated, “We are disappointed with the verdict but remain confident in our case. We will carefully evaluate all of our legal options moving forward.” It remains to be seen whether Phillips 66 will appeal the verdict or seek other legal remedies.
This case underscores the growing importance of intellectual property protection in the renewable energy sector, as companies compete to capitalize on the increasing demand for sustainable fuel solutions.
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