Sunday Telegraph: Promotions expert claims Shell stole his Smart card idea
By David Harrison
Issue No. 1472
Sunday 6 June 1999
A BUSINESSMAN who claims Shell stole his ideas for its internationally successful Smart card promotion scheme, is this week launching a multi-million pound lawsuit against the oil company.
If John Donovan wins he stands to collect millions. If he fails he will lose everything - including his home. The case - alleging breach of contract and misuse of confidential information - opens in the High Court on Thursday and is expected to last three weeks with costs running up to £1 million.
Mr Donovan, 52, says that Shell took his ideas - which he gave to it in confidence - and developed them without consulting or paying him. He said: "I want what I am entitled to and I want the world to see that Shell is not the company it claims to be in its glossy propaganda brochures."
Shell denies the allegations and is counter-claiming £100,000 for breach of a confidentiality agreement. Richard Wiseman, its legal director, said Mr Donovan was "misguided" and had been wrongly encouraged by Shell's previous payments. Mr Donovan has received £60,000 and another substantial undisclosed sum in settlements from Shell after claiming the theft of other ideas. Mr Wiseman said Mr Donovan's expertise was no longer appropriate for the type of promotions Shell was doing.
The court case is the culmination of a six-year campaign by Mr Donovan and his father, Alfred, 82, which has seen them picket Shell's London headquarters and buy two Shell shares each to give them access to annual general meetings. At risk in the latest action is their detached home near Bury St Edmunds, Suffolk.
The Donovans began devising promotion schemes in the late Sixties when Mr Donovan senior owned a chain of petrol stations in East London and Essex. In 1981 they struck their first deal with Shell for a "Make Money" promotion scheme - in which petrol purchasers had to find two matching halves of a "banknote". Shell gave them £500 to help to develop the idea. The scheme was a success and others followed: a £4.5 million Mastermind promotion; a scratch card game offering £2.5 million of food prizes from Harrods; a card game endorsed by Bruce Forsyth; and a £4.5 million Star Trek promotion.
Mr. Donovan said: "We were putting up ideas in confidence. We both respected that. We worked exclusively with Shell on a handshake basis." Mr Donovan's company, Don Marketing, was paid about £50,000 for each idea plus a percentage of printing costs and other fees. But the relationship changed in 1992 when Shell appointed a new national promotions manager.
In April 1994, Mr Donovan issued a writ against Shell over the use of a "Make Money" scheme. He threatened to sue each of Shell's 2,000 forecourt businesses. He accepted a £60,000 settlement and continued to fight Shell over a Nintendo promotion and a film promotion called "Now Showing".
The Donovans formed a pressure group, The Shell Corporate Conscience Pressure Group. In October 1996 Shell paid another, larger, sum to settle the outstanding claims. In March 1997, when Shell launched the Smart loyalty card, an ambitious promotion involving companies such as Woolworth and British Airways, Mr Donovan claimed that it was almost identical to a scheme he had first proposed in 1989. He claims that the oil company took an option on it in 1990.
He also alleges that Shell used an undercover investigator, Christopher Phillips, to look into his financial affairs. Shell's lawyers admit that they hired Mr Phillips, but only to carry out "routine credit inquiries".
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