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DENVER—Four people have filed a lawsuit accusing Petroleum Development Corp. of not paying them enough royalties on natural gas production from wells in Colorado.

The lawsuit filed Monday in U.S. District Court seeks class-action status.

The plaintiffs, who live in Colorado and Montana, say Petroleum Development Corp. has been paying out royalties after deducting costs of getting the natural gas into marketable condition, rather than making payments based on what the gas would fetch on the commercial market.

The lawsuit said at least $5 million was believed to be at issue.

The company did not return an e-mail seeking comment.

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