Tenth Circuit adopts objective, non–administrative-feasibility ascertainability; clarifies PRSA compound-interest accrual “until the day paid”; and limits punitive damages in Oklahoma royalty class actions absent an independent tort

Case: Cline v. Sunoco (R&M) and Sunoco Partners Marketing & Terminals, L.P.

Court: United States Court of Appeals for the Tenth Circuit

Date: November 17, 2025

Authoring Judge: Judge Federico (with Judge Moritz concurring in part and dissenting in part)

Introduction

This published decision arises out of a class action brought by royalty owners against Sunoco entities acting as “first purchasers” of crude oil from Oklahoma wells. The lawsuit alleged Sunoco systematically violated Oklahoma’s Production Revenue Standards Act (PRSA), Okla. Stat. tit. 52, §§ 570.1–570.15, by failing to pay statutory interest automatically with late proceeds payments. After the district court certified a class exceeding 53,000 owners and conducted a bench trial, it entered judgment for the class on the PRSA claim (but not on a separate fraud claim), awarded more than $103 million in actual damages (including compounded prejudgment interest), and $75 million in punitive damages.

On appeal, Sunoco attacked: (1) class certification (predominance, ascertainability, and standing), (2) the inclusion and scope of prejudgment interest, and (3) the punitive damages award. The Tenth Circuit affirmed the class certification and the PRSA damages award, but vacated the punitive damages.

The opinion establishes at least three important doctrinal points likely to shape class actions and oil-and-gas litigation in the Tenth Circuit and Oklahoma:

Ascertainability: The Tenth Circuit formally adopts the Seventh Circuit’s objective ascertainability standard and rejects “administrative feasibility” as a required element.
PRSA interest: The court interprets “until the day paid” in PRSA § 570.10(D)(1) to mean late proceeds and the PRSA-compounded interest must be paid before interest stops accruing; unpaid statutory interest becomes part of the principal and continues to earn interest until paid.
Punitive damages: Punitive damages are unavailable where the only successful claim is a PRSA violation construed as ex contractu under Oklahoma law; the Energy Litigation Reform Act (ELRA) does not provide a “backdoor” to punitives absent proof of an independent, intentional tort.

Summary of the Opinion

Class certification affirmed. Predominance was satisfied because Sunoco’s uniform corporate practice—refusing to include PRSA interest unless specifically requested—created common, classwide issues that outweighed individualized questions (e.g., marketable title, damages calculations). The court also adopted an objective, two-part ascertainability standard (clear, objective class definition) and rejected administrative feasibility as a separate prerequisite. Sunoco’s poor recordkeeping could not defeat ascertainability.
Standing affirmed. Class members whose proceeds/interest were remitted to unclaimed property funds suffered a concrete monetary injury; payment to the state custodial fund is payment to an agent on behalf of owners and does not defeat injury-in-fact.
PRSA damages affirmed. Statutory interest at 12% (or applicable lower rates when marketable title is legitimately in question) is compounded annually “until the day paid”, meaning interest accrues until both proceeds and accumulated PRSA interest are paid. The court declined to graft equitable exceptions onto Oklahoma’s statute.
Punitive damages vacated. Because the class prevailed only on the PRSA claim (a contract-based claim under Oklahoma law) and not on fraud, punitive damages were unavailable. The ELRA’s punitive path requires an independent intentional tort showing, which was not present here.

Analysis

Precedents Cited and How They Shaped the Decision

The court’s certification analysis synthesizes several Tenth Circuit class-action decisions:

In re Urethane Antitrust Litigation: Confirmed that a uniform, unlawful scheme can dominate over individualized issues and that post-trial records may validate predominance. The Cline panel leaned on Urethane’s insight that actual trial proceedings can confirm common issues predominated.
CGC Holding Co. v. Broad & Cassel: Supported predominance where a “common scheme to defraud” is provable with generalized evidence. Although Cline’s fraud claim failed at trial, CGC’s emphasis on a defendant’s uniform conduct informed the predominance analysis for PRSA liability.
Menocal v. GEO Group: An employer’s uniform coercive policy sustained predominance; likewise, Sunoco’s uniform practice of not paying interest unless demanded provided the “glue” uniting class claims.
Naylor Farms, Inc. v. Chaparral Energy: Individualized damages (or contractual variations) rarely defeat predominance where a single breach issue predominates. The court treated marketable-title contentions and damages mechanics as post-breach or individualized issues that did not swamp common questions.
Wallace B. Roderick Trust v. XTO Energy: Distinguished because, unlike Roderick’s undeveloped lease variations, Cline proceeded to a bench trial with reliable classwide damages modeling and without concrete proof of individualized marketable-title disputes.
Wal-Mart v. Dukes: The panel explained Dukes’ limited utility in a Rule 23(b)(3) damages class targeting a uniform corporate policy. Dukes’ concerns about millions of localized, discretionary decisions across a nationwide workforce did not fit Sunoco’s companywide practice.

On ascertainability, the court expressly joined the majority approach:

Mullins v. Direct Digital (7th Cir.), Rikos v. P&G (6th Cir.), Kelly v. RealPage (3d Cir.), and related cases anchored the holding: class definitions must be clear and objective; administrative feasibility is not a prerequisite; defendants cannot weaponize poor records to defeat certification. The court aligned the Tenth Circuit with the majority view and explicitly rejected the minority’s administrative-feasibility requirement.

On PRSA interest and Oklahoma law:

Purcell v. Santa Fe Minerals and Krug v. Helmerich & Payne underscore that PRSA interest is no longer punitive but a contract-integrated remedy aimed at prompt, full payment. The PRSA’s evolution (including compounding) reflects the legislature’s continuing protection of mineral owners’ rights.
Okla. Stat. tit. 25, § 27 defines “compound interest” as interest that is added to principal and thereafter earns interest—central to the court’s reading that unpaid PRSA interest itself becomes principal for further accrual.
Quinlan v. Koch Oil (10th Cir.) and Hull v. Sun Refining & Marketing (Okla.) guide treatment of marketable title: absent a legitimate, concrete dispute, marketable-title issues cannot justify withholding payments or defeat class cohesion; here, Sunoco had already paid proceeds, undermining any serious marketable-title challenge.
Hebble v. Shell Western E&P and Okland Oil Co. v. Conoco support that PRSA interest is part of compensatory damages and substantively governed by Oklahoma law in diversity cases.
Echo Acceptance Corp. v. Household Retail Services (10th Cir.) illustrates that federal courts sitting in diversity cannot graft equitable exceptions to state interest statutes; the panel rejected Sunoco’s fairness-based plea to halt accrual earlier than Oklahoma law provides.

On standing and unclaimed property funds:

Oklahoma’s Uniform Unclaimed Property Act and cases like Dani v. Miller, TXO Production Corp. v. OCC, and Croslin v. Enerlex establish that states hold unclaimed funds in a custodial capacity; payments to the fund are effectively payments to an agent for the owner. The court used that framework to find concrete monetary injury to unidentified owners.

On punitive damages and the ELRA/§ 9.1 interplay:

Purcell, Krug, and Base v. Devon Energy confirm PRSA claims are ex contractu. Oklahoma’s § 9.1 bars punitive damages for breach of contract; punitive damages require an independent tort (e.g., fraud), per Oklahoma precedent (e.g., Zenith Drilling v. Internorth).
The panel harmonized ELRA § 903 with § 9.1: although § 903 recognizes punitive damages for willful withholding of proceeds, a plaintiff must still prove an independent intentional tort to clear Oklahoma’s punitive-damages bar in a contract action. Because the class lost its fraud claim at trial, punitive damages could not stand.

Legal Reasoning

Predominance. The court emphasized that Sunoco’s companywide practice—only paying statutory interest upon request—created a unifying, dispositive merits question: does the PRSA obligate automatic interest on late proceeds? With liability resolved classwide at summary judgment and trial evidence validating a reliable damages model (Barbara Ley’s database and computations), individualized issues (marketable title, payment timing nuances) did not overwhelm the common issues. The panel noted that damages questions, and even some affirmative defenses, rarely negate predominance where a central policy or breach can be proved with common evidence.

Ascertainability. Adopting the Seventh Circuit’s Mullins standard, the panel held that ascertainability requires only a clear and objective class definition; administrative feasibility is not a necessary element. Administrative difficulty in identifying class members affects manageability/superiority, not the threshold ability to certify. Importantly, defendants cannot leverage their own poor recordkeeping or data fragmentation to defeat ascertainability; courts may order matching across multiple databases and accept “reasonable—but not perfect—accuracy.”

Standing for unidentified owners. The court held that sending proceeds to an unclaimed property fund does not negate injury-in-fact: the owners still suffered a concrete monetary loss when Sunoco failed to include PRSA interest. States hold such funds in custodial trust pending claims by the true owners; this is not escheat. Sunoco’s statutory duty to maintain adequate records and make bona fide efforts to locate owners further undercut its standing challenge.

PRSA interest accrual “until the day paid.” Textually, § 570.10(D)(1) mandates that the unpaid portion “shall earn interest” at the stated rate “to be compounded annually … until the day paid.” Oklahoma’s definition of compound interest (title 25, § 27) treats accrued interest as added to principal and itself interest-bearing. Reading the PRSA as a whole and in light of legislative intent to protect owners and prompt payment, the court held that interest ceases only when both proceeds and accumulated PRSA interest are paid. The court rejected equitable exceptions and arguments that accrual should stop at proceeds payment alone or at judgment date by operation of a general prejudgment-interest framework; Oklahoma’s specific oil-and-gas statute controls.

Punitive damages. The panel concluded that PRSA claims are contract-based remedies; punitive damages under Oklahoma § 9.1 require an independent tort. The ELRA’s punitive authorization must be harmonized with § 9.1. Without a successful tort (the class lost its fraud claim), punitive damages could not be awarded for a mere PRSA breach. The court therefore vacated the $75 million punitive award. Judge Moritz agreed vacatur was required on the district court’s findings but would have remanded for the court to consider punitive damages under ELRA’s “intent to withhold proceeds” standard alone, without requiring a separate tort; the majority disagreed.

Impact

Class action practice in the Tenth Circuit.

Ascertainability is now settled: clear, objective definitions suffice; no administrative-feasibility prerequisite. This will materially ease certification of consumer, wage-and-hour, data privacy, and other damages classes where defendants maintain (or should maintain) the relevant records.
Corporate policy cases strengthen predominance. When plaintiffs target a uniform practice, predominance is likely to be met, especially where expert models can compute damages at scale. Courts may rely on post-trial records to confirm predominance was properly found.
Affirmative defenses seldom derail certification. The opinion reaffirms that individualized defenses (e.g., marketable title) usually go to damages or subsets and can be managed without defeating Rule 23(b)(3).

Oklahoma oil-and-gas litigation.

Automatic statutory interest is not optional. First purchasers and other PRSA “holders” must include PRSA interest automatically on late payments. Failing to do so can generate large, compounded liabilities “until the day [interest is] paid.”
Marketable-title exception requires concrete proof. Having paid proceeds, a holder will face an uphill climb to claim a “legitimate question” of marketable title. The defense is effectively an affirmative defense requiring specific, property-level proof—not generalities or expert testimony untethered to actual title searches.
Unclaimed property procedures matter. Routing funds to state unclaimed property does not immunize holders from interest liability or standing; it is treated as payment to the owner’s agent. Companies must maintain compliant records and make bona fide efforts to locate owners.
Punitive damages are limited. Absent a proven, independent intentional tort (e.g., common-law fraud or deceit) meeting Oklahoma’s punitive standards, punitive damages are unavailable for PRSA-only breaches. Plaintiffs seeking punitives should plead, certify (where appropriate), and prove a tort theory distinct from the PRSA breach—and, under ELRA, focus on willful withholding of proceeds (not just interest).

Compliance and systems.

First purchasers and payors should update payment systems to compute and include PRSA statutory interest with any late proceeds payment, and track accrual until all interest is paid.
Recordkeeping must meet statutory obligations; fragmented databases or late data dumps will not defeat certification or liability and may be viewed as obstructionist.
Audit trails tying title decisions to specific owners/wells will be essential where marketable title is genuinely in dispute.

Complex Concepts Simplified

PRSA “first purchaser”: The entity that buys oil at the wellhead and is obligated to distribute proceeds to owners on tight timelines. If it pays late, it must add statutory interest automatically.
“Marketable title” exception: If there’s a legitimate, concrete cloud on an owner’s title, payments can be delayed; interest accrues at a lower rate during the clouded period (for applicable years). But generalized or unsubstantiated doubts don’t qualify.
Compound interest “until the day paid”: Each year, accrued interest is added to principal and the combined amount earns interest going forward. Under the PRSA, accrual continues until both the late proceeds and the accumulated statutory interest are actually paid.
Ascertainability (majority rule): A class is ascertainable if the definition is clear and objective. Courts do not require a showing that identifying every member will be easy or administratively simple at certification.
Predominance vs. individualized issues: A case can be certified even if damages differ member-to-member, so long as a common question (e.g., a uniform policy breach) is more important than the differences for adjudication.
Unclaimed property funds: When a payor can’t locate an owner, certain states require remitting funds to a custodial fund. That payment is treated as holding the money for the owner—owners still have a claim, and injury-in-fact exists for standing.
ELRA and punitive damages: Oklahoma’s ELRA allows punitive damages in oil-and-gas late-payment cases upon a high intent showing, but in federal court applying Oklahoma law, punitive damages remain unavailable for a pure contract claim unless the plaintiff also proves an independent, intentional tort.

Conclusion

Cline v. Sunoco is a defining opinion for both class action doctrine in the Tenth Circuit and PRSA enforcement in Oklahoma. The court:

Solidified a workable, objective ascertainability standard and rejected administrative feasibility as a certification hurdle.
Confirmed that a uniform corporate practice can dominate common issues under Rule 23(b)(3), with trial records used to validate predominance.
Clarified that PRSA statutory interest compounds and accrues “until the day paid”—meaning until both late proceeds and the accrued statutory interest are paid—not merely until the late proceeds are paid.
Enforced Oklahoma’s bar on punitive damages for contract claims by vacating a large punitive award where only a PRSA breach was proven; ELRA’s punitive pathway requires proof tantamount to an independent intentional tort focused on withholding proceeds.

Practically, first purchasers and other PRSA “holders” must automate the calculation and payment of statutory interest with any late proceeds, maintain meticulous records, and recognize that class certification cannot be avoided by scattershot records or speculative affirmative defenses. Plaintiffs, for their part, will find certification easier where a uniform policy is at issue and should tailor punitive-damages strategies to include a provable independent tort theory under Oklahoma law.