Northville Man Sues, Seeks Chevron Stock At '04 Price
NORTHVILLE, Mich. (AP) - A former lawyer intrigued by the global demand for energy says he chose to invest $100,000 in oil giant Chevron Corp. back in 2004, a smart stock bet that now would have doubled seven years later.
But Perry Christy has a big problem: He says Chevron's stock agent never deducted money from his bank account. As a result, he has no records to show he actually owns a certain number of shares.
So Christy, 69, is suing Chevron and Mellon Investor Services and seeking an extraordinary remedy. He wants a federal judge to declare that he should be credited with buying the stock at a June 2004 price, plus any additional shares that would have piled up by reinvesting dividends. Then he'll pay $100,000.
Based on the terrific rise in San Ramon, Calif.-based Chevron's stock, it would be like winning the lottery - and then buying a ticket.
"There was some kind of mix-up on the day I placed the order," Christy insisted in an interview at his home in the Detroit suburb of Northville. "Whether mechanical or electronic, I don't think we'll ever know. But it's their screw-up. When you deal with any large bureaucracy, people are focused on their own narrow niche."
After more than a year in court, Chevron and Mellon smell a scam and want the case dismissed, even suggesting that Christy's story of a genuine yet botched investment simply is a lie.
"Litigation cannot be used as a form of risk-free investment strategy," attorney Nicholas Gorga said in a filing.
There are ways to purchase stock without going through a traditional broker. They include clicking online and making investments through company-sponsored plans that carry low fees or none at all. Chevron offers such a program through Mellon.
There is no dispute that Christy went online and created a Chevron account in 2004. He has a document confirming it and another record that states, "Your shares have been entered."
But there's also no dispute that no money ever changed hands. Christy said he instructed Mellon to take $100,000 from his bank account. Although bank records show he had more than enough money to cover it, the transaction was never completed.
"It's the weakest point I have" in the lawsuit, conceded Christy, who has a master's degree in business from the University of Pennsylvania's Wharton School in addition to a degree from the University of Michigan law school.
He said he noticed that his bank balance hadn't changed much. He said he contacted Mellon about the investment but never got a proper reply about what had happened.
"They kept promising, `We'll get back to you.' I wasn't going to call them anymore. It wasn't that I had a mental lapse," Christy said. "I got tired."
He said email and letters weren't productive, either. Meanwhile, as oil prices have risen over the years, so has Chevron's stock. If dividends were reinvested, Christy claims he would own roughly 2,600 shares today worth approximately $260,000.
Lawyers for Chevron and Mellon said the case has no merit. They said Christy filed the lawsuit in 2010 as a last gasp as the statute of limitations neared. They also have raised doubt about his credibility, noting that his law license was revoked in 1997 after Christy was caught accepting clients while the license was suspended. He said it's irrelevant.
A judge will hear arguments on Aug. 30 about whether to dismiss the case. As he approaches 70, Christy said he didn't want to leave the mess to his family.
"If I die," he said, "my heirs would have a hell of a time reconstructing what went on."
(Copyright 2011 by The Associated Press. All Rights Reserved.)
