Not surprisingly, the case is being fought in the US on behalf of some of the company's shareholders after its shock downgrading of reserves by 20% caused a large drop in its share price.

Shell said half of the downgraded oil equivalent reserves were attributable to Nigerian and Australian projects. The company has been carrying thirteen of Gorgon's estimated 40 trillion cubic feet of gas (tcf) of probable reserves as booked reserves since 1997 when the first non-binding letter of intent were signed.

The world financial markets reacted sharply to the news, wiping around 7.5% or A$19 billion from the value. Calls have also intensified for the resignation of chairman Sir Philip Watts, who has been on the back foot over his performance according to reports in the financial media.

A statement from the law firm Milberg Weiss Bershad Hynes & Lerach LLP said Shell deliberately violated accounting rules and guidelines relating to oil and gas reserves which resulted in a shocking and unprecedented overstatement of oil and gas reserves and the firm is now seeking to pursue unspecified remedies for the shareholders.

Under American law a class action can be brought forward by a small group on behalf of the majority. Not surprisingly law firms are usually paid via a percentage of any award in the plaintiffs favor and Milberg is also among the law firms that have filed class action suits on behalf of shareholders against the crumbling Swiss recruitment firm Adecco.