PSX · 10-Q · 2026Q2 · Full report

Litigation and Legal Risk

Phillips 66 · 2026-08-05 · Importance 58 · Surprise 68 · In source text

A California jury awarded Propel Fuels $604.9 million in compensatory damages, and the final judgment entered August 5, 2025 totaled $833 million, including $195 million of exemplary damages and $33.3 million of prejudgment interest. Accrued amounts rose to $928 million at June 30, 2026, from $867 million at December 31, 2025. Post-judgment interest accrues at 10% and is recorded in Selling, general and administrative expenses within the Marketing and Specialties segment. Phillips 66 filed its opening appellate brief on July 10, 2026, and could incur losses exceeding the accrued amount if its appeal is unsuccessful.

Key facts

• On October 16, 2024 a jury returned a verdict against Phillips 66 Company for $604.9 million in compensatory damages and issued a willfulness finding in the Propel Fuels case. source
• On August 5, 2025 the Propel Court entered a final judgment against Phillips 66 Company in the amount of $833 million, which includes the $604.9 million jury verdict, $195 million of exemplary damages, and $33.3 million of pre-judgment interest at 7%. source
• From the date of final judgment post-judgment interest of 10% is accruing and is included within the 'Selling, general and administrative expenses' line and reported in the M&S segment. source
• Phillips 66 Company filed its Notice of Appeal on November 14, 2025 and filed its opening brief with the Court of Appeal on July 10, 2026 in the Propel Fuels matter. source
• Accrued amounts related to the Propel judgment totaled $928 million as of June 30, 2026 and $867 million as of December 31, 2025 and are reflected as 'Other liabilities and deferred credits' on the consolidated balance sheet. source
• At March 31, 2026 we had been notified of potential liability under CERCLA and comparable state laws at 17 sites within the United States and Puerto Rico, and there were no changes during the second quarter of 2026 leaving 17 unresolved sites with potential liability at June 30, 2026. source

Impact estimates