OKLAHOMA CITY - A judge presiding over the divorce case of Oklahoma oil billionaire Harold Hamm closed the courtroom to the public on Monday, the trial's opening day, saying he feared that private business information to be discussed at trial would harm Hamm's company, Continental Resources.
Oklahoma County Court Judge Howard Haralson asked journalists and others without a direct interest to exit the courtroom before attorneys began opening statements. Haralson said he would allow public access to parts of the trial that don't address Continental's confidential information. The case is expected to divide a fortune tied up in Hamm's 68 per cent stake in Continental, worth more than $19 billion. "There is no sense in destroying a company over a divorce trial," Haralson said. He said he was taking the measure to "protect the third party," meaning Continental.
The publicly traded Oklahoma City-based oil driller has a market capitalisation exceeding $28 billion. It is the largest player in the booming Bakken Shale formation of North Dakota, and has reported reserves of more than 1 billion barrels.
Continental General Counsel Eric Eissenstat told the court that opening statements would contain sensitive information, including a balance of the marital finances, references to minutes of Continental board meetings, confidential emails and information about Continental's oil reserves that haven't been made public. Competitors could use that information, Eissenstat said.
Haralson said he agreed with Continental's argument, while adding: "I sure don't believe in things being done behind closed doors." Divorce proceedings are usually open, though many litigants would prefer that they remain private, family law specialists say.
Reuters has asked the judge to reverse his decision and open the proceedings.
A lawyer for Sue Ann Hamm, Robert Bartz, told the court that his team's opening statements would not go into great detail on confidential aspects of Continental's business. But he said the trial, scheduled to last nine weeks, would revolve around Continental's oil reserve estimates as a measure of its wealth. That information could help to determine the size of the marital estate to be divided. "That is what this trial is all about," Bartz said, referring to Continental's reserves.
Since its debut on the New York Stock Exchange in 2007, Continental has provided detailed, publicly available statements to the Securities and Exchange Commission, as other listed companies do. These include financial statements, reserves figures, investment plans and other information that could be material to its operations.
The case was filed by Sue Ann Hamm in 2012. Investors are following the trial because a large award could prompt Harold Hamm to liquidate Continental shares, potentially affecting his controlling stake.
Hamm founded Continental in 1967. The couple married in 1988, when Continental was a relatively small driller. Under Oklahoma law, any accrual of wealth resulting from the work efforts of either spouse during the marriage would be considered "marital wealth" and subject to division between the spouses.