The suit was commenced by originating summons, supported by an affidavit filed on behalf of all the Plaintiffs by their counsel. The Plaintiffs challenged the constitutionality of the Allocation of Revenue (Abolition of Dichotomy in the Application of the Principle of Derivation) Act, which was passed into law in 2004.

The Plaintiffs argued that the Act disturbed the amount that will accruable to Federation Account which in turn reduced the revenue due to the Plaintiffs. The Plaintiffs sought a declaration that the 2004 act was unconstitutional, ultra vires the Defendants and therefore null and void.

The Defendants countered that the Act was passed into law by representatives of all the States in Nigeria.

They argued that the Act made natural resources, including crude oil, derived from the waters and subsoil contiguous to the coastline or seawards limits of inland waters of an oil producing littoral state extending to the 100 meter water depth (isobaths) are deemed part of the State only for the purpose of computing revenue accruing to that state under the principle of derivation. Even in this circumstance, ownership of all natural resources derived offshore continue to be vested in the Federal Government of Nigeria in accordance with all relevant laws.