Continental Divide

U.S. oil baron rewrites his company’s history; move could stave off record divorce payout

LEGAL STRATEGY: Continental Resources CEO Harold Hamm holds 68 percent of the company’s publicly traded shares – worth about $17 billion. Legal experts say changes on the corporate website may help convince the judge that the surge in Continental’s share value has little to do with Harold’s deft management during his 26-year marriage to Sue Ann. REUTERS/Steve Sisney

CEO Harold Hamm faces paying billions to his estranged wife. Do revisions to his corporation’s website strengthen his hand?

OKLAHOMA CITY – The divorce trial of one of America’s wealthiest men, oil baron Harold Hamm, plays out mostly in secret here at the Oklahoma County Courthouse. For weeks, signs have been taped to the door of Courtroom 121. “CLOSED HEARING,” one reads. The other: “DO NOT ENTER.”

But an examination of the website of the company Hamm founded, Continental Resources Inc, reveals part of the billionaire’s legal strategy as he seeks to avoid what could be the largest divorce award in U.S. history.

Publicly traded Continental has been revising its corporate annals – in each case diminishing the company’s accomplishments under Hamm’s leadership or changing the dates of key achievements.

Downplaying his role in Continental’s success is central to Hamm’s chances of minimizing the financial blow from his divorce, lawyers say. According to state law, if Hamm can show that market conditions – rather than his management prowess – led to Continental’s financial success, he won’t have to share those gains with his estranged wife, Sue Ann. The two never signed a prenuptial agreement.    

Reporters compared Continental’s current corporate website – – with a version from early this year. The analysis was done using the Internet Archive Wayback Machine, a repository of past web pages.

The comparison identified 18 separate items that had been recently deleted, added or revised. The changes included:

• Altering a claim that the company was first to “discover” an important oil field near the massive formation known as the Bakken Shale.

• Striking all references to Continental being “first” to successfully use or develop new technology that helped it find or pump more oil.

• Backdating the company’s hugely profitable decision to shift its exploration focus from natural gas to oil – to before Hamm’s 1988 marriage to Sue Ann. If that decision came prior to the Hamm marriage, then Sue Ann may not be entitled to reap part of the reward.

• Adding a date for when Continental moved into its most profitable drilling area. The company’s website now says that the firm moved into the Williston Basin, which straddles North Dakota and Montana, a year before the Hamms were married. The company also deleted an item that said Continental expanded into the Rocky Mountain region in 1993.

The company also removed a notable passage from one of its U.S. Securities and Exchange Commission filings, key documents used by investors to evaluate firms. In 2013 and earlier years, the annual proxy statement described Harold Hamm as “one of the driving forces” behind Continental’s success, a man who had “successfully grown the Company through his leadership skills and business judgment.” That passage was dropped in the 2014 proxy.

A spokeswoman for Continental Resources, Kristin Miskovsky, declined to comment about any of the specific website changes or the role of Continental’s board in reviewing them. She didn’t answer questions about the proxy change. In an email, Miskovsky repeated a prior statement: The Hamm divorce “has not and is not anticipated to impact Continental Resources’ business or operations.”

Since Hamm vs. Hamm began eight weeks ago, journalists have largely been barred from the courtroom. At the request of Continental, nearly all records and exhibits in the trial have been placed under seal by Oklahoma County Judge Howard Haralson; all but three days of the trial have been completely closed to the public. In most states, including Oklahoma, divorce trials usually take place in open court unless a judge closes the proceedings to protect a child. The Hamms have no minor children.

An example of how Continental has revised its website claims: before (top) and after (bottom). REUTERS GRAPHIC

The reason: to shield Continental. Haralson ruled on the trial’s opening day, Aug. 4, that he did not want to “destroy” the company by allowing the public or media to hear discussion of Continental’s “confidential” business activities.

“We’ve got an entire trial being conducted in secret,” said Joey Senat, a communications law specialist and associate professor at Oklahoma State University’s School of Media and Strategic Communication. “Mr. Hamm is saying his divorce is a strictly personal matter, but apparently it’s not, because Continental says it will harm the company if the doors are opened. Meanwhile, on the website, Continental appears to be changing significant facts about itself.”

There are also personal reasons why Hamm may prefer to keep the proceedings private. In a filing dated March 7, 2013, Sue Ann Hamm alleged that Harold was “having an affair” that she discovered in 2010. In court testimony last month, Harold admitted to spending $150,000 on an “extra-marital pursuit.”


At stake in the divorce is the $17 billion piece of Continental owned by Harold Hamm through his 68 percent holding in the company’s publicly traded shares. Legal experts interviewed for this article said the changes on the website appear to be part of Hamm’s strategy.

“Very simply, the company may be framing Mr. Hamm’s impact as less important than it had before.”

Ilan Hirschfeld, head of the marital dissolution practice, Marcum LLP

The purpose, they say, is to persuade the judge that the surge in Continental’s share value has little to do with Harold’s deft management during his 26-year marriage to Sue Ann. Under Oklahoma law, if the growth of Continental was “passive” – that is, owing to market factors beyond Harold’s control rather than to his skill and effort – he won’t have to share those gains.

“The corporate website, along with public filings, are places we always look when a divorce case involves a business,” said Ilan Hirschfeld, head of the marital dissolution practice at accounting and advisory firm Marcum LLP. “Lawyers love to use the company’s own reports to prove their case that the growth in marital wealth has been active.”

“Very simply,” Hirschfeld said, “the company may be framing Mr. Hamm’s impact as less important than it had before.” Hirschfeld isn’t involved in the case.

Attorneys representing the Hamms are under court order not to discuss protected information in the case. They declined to comment.

Harold Hamm’s lawyers were given a big clue that Continental’s past accomplishments would be used by his wife’s team to demonstrate the central role the founder played in the company’s skyrocketing growth. That’s because parts of the unrevised version of the website – including its corporate “timeline”– were among the exhibits entered into evidence by Sue Ann Hamm’s lawyers before the trial began. Lists of exhibits are shared with both parties in a case.

HAMM VS. HAMM: Continental Resources founder and CEO Harold Hamm (left) is believed to own more oil underground than any other American. His estranged wife, Sue Ann (right), is a former lawyer with the company. REUTERS/Steve Sisney

“I’ve not tried to mislead anybody”

Harold Hamm, Continental Resources founder and CEO

One corporate governance specialist said the website revisions raise questions about Continental’s board of directors, chaired by Hamm: Did the board previously allow the company to overstate its achievements? And is it now allowing Hamm to reshape Continental’s image to serve his personal legal goals – and marshalling company resources to do so? When questioned by an attorney for Sue Ann during open testimony on Aug. 6, for example, Harold said he had ordered his staff to revise Continental’s corporate timeline after he realized it contained inaccuracies.

“It puts the board in a very awkward position,” said the governance specialist, David Larcker, professor of accounting at Stanford University’s Graduate School of Business. “The question would be, ‘Would they have made those changes absent the personal situation of the CEO?’”

A member of Continental’s board, Edward T. Schafer, declined to discuss the changes, or whether the board knew about them. “Given the legal aspects of what you are talking about, I think I ought to leave that question to the company,” said Schafer, former governor of North Dakota. Another board member, former Oklahoma Gov. David Boren, referred questions to Continental’s general counsel.

 Today, at 68 years old, Hamm is believed to own more oil underground than any other American. Continental’s assets include around 1 million acres of prime land leases in North Dakota and Montana, the location of the largest U.S. oil discovery in decades.

Attorneys following the Hamm divorce say a judgment could award 58-year-old Sue Ann Hamm, a former lawyer for Continental, around $3 billion.

CLOSED HEARING: Since Hamm vs. Hamm began eight weeks ago, journalists have largely been barred from the courtroom in the Oklahoma County Courthouse. REUTERS/Steve Sisney


Reuters could not determine exactly when Continental altered its website. The changes came sometime after March 29, 2014, the most recent day on which the Wayback Machine archived the site, and before Sept. 2, 2014, when Reuters began comparing the archive and the current site. Also unclear: Which version of Continental’s corporate history – revised or original – is more accurate.

In media interviews, in the company’s annual report and in other SEC filings, Continental has for years touted its pioneering role in developing the Bakken Shale formation. And it has highlighted the prescient moves of its founder, Harold Hamm, as central to its success.

Continental’s website does contain a disclaimer about its contents. Information is provided “as is, solely for convenience, and without warranty of any kind.” It may contain errors, and investors should not base decisions on it, the website cautions.

Guidelines published by the SEC say that corporate websites, though considered “informal disclosure,” should adhere to some of the same standards that apply to formal SEC filings. “The broad principles are that the disclosures have to be truthful and fair and cannot be selective,” said Jim Hamilton, principal analyst for federal securities regulation at Wolters Kluwer Law & Business in New York.

The Reuters analysis of archived Continental web pages shows a wide range of changes around the time that the CEO’s divorce trial began.

A timeline entry describing a 1995 milestone, for example, previously gave Continental sole credit for a momentous event: “Continental discovers” the Cedar Hills oil field – the first major gusher in North Dakota’s recent fracking boom, which led to the development of the now-legendary Bakken Shale, the web page previously read. The old entry added that Continental “is the 1st to develop Cedar Hills exclusively through precision horizontal drilling,” an oil-industry technological innovation.

Today, the timeline says Continental “co-discovers” the Cedar Hills field, and no longer takes credit for developing it first. Rather, the company now describes Cedar Hills passively, as “the 1st oil field in the U.S. to be developed exclusively through precision horizontal drilling.” (In his Aug. 6 testimony, Harold Hamm said he recalled that a competitor, Burlington Resources, had tapped into Cedar Hills several months before Continental did.)                        

Other changes backpedal on Continental’s claims that it was ahead of industry competitors in implementing breakthrough oil extraction technologies, a potentially crucial differentiator in the oil industry.

A 2007 entry used to say that Continental “is the 1st to complete a 1,280 long-lateral multi-stage frac in North Dakota.” The line referred to an important milestone in using hydraulic fracturing, or fracking, and horizontal drilling to extract oil from the Bakken. That claim no longer appears on the current website.

Two other entries, both for 2008, said Continental was the “first” to use specific fracking or horizontal drilling techniques in two separate oil fields. Those entries have been struck from the site.

On the witness stand last month, Harold Hamm said several claims on the company’s website timeline were wrong. He pinned part of the blame on Brian Engel, the former vice president of public affairs at Continental, who left in 2011.

Contacted for comment, Engel said he wasn’t aware of Hamm’s testimony. “I left Continental on good terms at the end of 2011 and have moved on,” Engel said. He declined to say whether Hamm reviewed the original items before they were posted.

Sue Ann Hamm’s attorney, Jon Hester, questioned Harold about items on the company website. Hamm testified that he only recently discovered that some were inaccurate. Continental produces a significant amount of public information, he explained, and Hamm said he doesn’t personally review all of it. “I’ve not tried to mislead anybody,” Hamm testified.


Continental is not named as a party in the Hamm divorce. The company nonetheless sought to keep the trial closed to the public. Continental’s general counsel, Eric Eissenstat, has been a fixture in the courtroom and has arranged depositions and met with witnesses who are testifying at the trial, according to court records and proceedings viewed by Reuters.

STOCK SPLIT? A billboard in downtown Oklahoma City touts the value of publicly traded shares in Continental. REUTERS/Steve Sisney

“It puts the board in a very awkward position. The question would be, ‘Would they have made those changes absent the personal situation of the CEO?’”

David Larcker, corporate governance specialist, Stanford University’s Graduate School of Business

Continental still boasts in its SEC filings that it holds the largest acreage position of any oil company in the Bakken, a shale area that Hamm believes contains some 24 billion barrels of oil.

Investors may not care about Continental’s revisions to its corporate history, so long as it continues to produce profits, stock analysts say. The driller is ahead of schedule on its five-year plan to double oil production.

“I’m not sure it’s huge,” said Joseph Allman, oil and gas analyst at JPMorgan, which also provides investment banking services to Continental. The company should make sure it gets its public statements right, he said, but he added: “People don’t invest in Continental because it discovered the Bakken. They invest in Continental because of future cash flow generation.”

Fidelity – the largest outside holder of Continental shares, with a 6.2 percent holding as of June 30 – declined to comment on the oil company’s history changes. Six other institutional holders of Continental shares didn’t respond or declined to comment.

Wall Street has been kept largely in the dark about the divorce. Continental has not disclosed the case in the legal proceedings section of its SEC filings. The company first publicly acknowledged the divorce in response to questions from Reuters in March 2013.

Judge Haralson already has ruled that Harold’s shares in Continental are an asset that he owned prior to the marriage. As a result, only the increase in the value of those shares during the marriage is at issue in the trial. The ruling leaves around $17 billion in accrued share value at stake. At trial, Continental’s value in 1988, when the Hamms were married, was estimated at less than $50 million. The company’s market capitalization is now near $25 billion.

Haralson’s ruling may also pertain to key decisions that Harold or his company made before the 1988 marriage – decisions that subsequently made the company, and Hamm, billions.

One of those big decisions occurred when Continental shifted its exploration focus from natural gas to oil, a move that bucked a prevailing U.S. energy industry trend and proved incredibly lucrative.

In a news release dated January 24, 1992, Continental said that the shift to oil began in 1988, the year of the marriage. But in court testimony, Harold Hamm said that the news release was wrong and had been issued without his review.

Backing Hamm’s courtroom denial, Continental has updated its timeline. In a new website entry, Continental now says the company “changes focus to oil” in 1985 – three years before Harold and Sue Ann Hamm married.

Reporting by Joshua Schneyer in Oklahoma City and Brian Grow in Atlanta. Edited by Blake Morrison

Photo editing by Jim Bourg and Stelios Varias