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Joel Connelly: Ninth Circuit to Exxon-Mobil: Pay up
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« Washington state's tax bite not too bad, study says | Main | Joel Connelly: $30 Million for Puget Sound -- Dicks gets his foot in the door »
Joel Connelly: Ninth Circuit to Exxon-Mobil: Pay up
Rejecting the oil giant's argument that it has suffered enough, the U.S. 9th Circuit Court of Appeals yesterday ordered Exxon-Mobil to pay a $2.5 billion punitive damages judgment stemming from the 1989 Exxon Valdez oil spill.
The appellate court had halved an original $5 billion judgment against Exxon-Mobil, brought down in 1994 by a U.S. District Court jury in Anchorage. But it rejected the oil company's petition to further downsize the award. Exxon-Mobil has argued that it should be made to pay no more than $25 million.
"It is time for this protracted litigation to end," the court said in its opinion.
The 1989 spill, worst in American history, fouled beaches on the west side of Alaska's pristine Prince William Sound, and polluted 400 miles of coastline in the 49th state. Exxon-Mobil has spent an estimated $3.5 billion on spill cleanup, and in establishing a fund spent on scientific study and environmental mitigation.
But the oil giant was sued on behalf of 32,000 commercial fishermen, native Alaskans and Prince William Sound residents, who asked for a judgment that would punish the oil company for its negligence.
The tanker Exxon Valdez was traveling off course when it hit Bligh Reef, a hazard to navigation clearly identifiable on navigation charts. Its captain, Joseph Hazelwood, was not on the bridge at the time of the accident. Hazelwood later pleaded guilty to operating the vessel under the influence of alcohol.
The spill officially dumped 11.9 million gallons of crude oil into Prince William Sound. Critics of Exxon-Mobil, citing lingering damage, have argued that the actual release of oil was much higher.
The case has bounced between U.S. District Court and the 9th Circuit for more than a decade. At one point, the appellate court ordered a reconsideration of the $5 billion award. But the original judgment was reinstated by a district judge in Anchorage. Just before Christmas in 2006, a panel of judges on the 9th Circuit voted to cut the award in half.
As the case was under appeal, Exxon-Mobil earned profits totaling $36 billion in one year, highest ever for any U.S. corporation. The oil giant has been earning interest on $5.4 billion set aside to pay a punitive damages judgment when the case was finally resolved.
An estimated one-quarter of the original plaintiffs in the lawsuit have died while the case was on appeal. One of the appellate judges who heard Exxon-Mobil argue for a reduction in the $5 billion judgment is also deceased.
The Exxon Valdez disaster resulted in major safety changes, some of which have been copied on Puget Sound. Heavy tugs escort laden tankers from the oilport of Valdez south to the entrance of the sound. Double-hulled tankers are being phased into use.
A Prince William Sound Citizens Advisory Committee, with representatives from local communities, has overseen readiness exercises and the location of cleanup equipment at strategic locations down the sound.
Despite the disaster, Alaska's congressional delegation has remained in the pocket of big oil, and skeptical about fossil fuels' contribution to climate change. Rep. Don Young, R-Alaska, at home for Congress' Easter recess, denounced emission limits of what he called "the Coyote Treaty," an apparent reference to the Kyoto Accord on global warming.
Two top executives of VECO, an oil services firm that helped manage the cleanup, pleaded guilty this month to making illegal payoffs to Alaska state legislators.
Posted by Joel Connelly at May 23, 2007 3:54 p.m.
Comments
#33947Posted by LoveYourViaduct at 5/23/07 6:25 p.m.Good luck getting oil out of a turnip. It's much cheaper to pay lawyers than victims. And once they are dead, who cares? Right?Eventually, they (and we) will all be dead.But that punitive damages judgment might be reduced again if the lawyers can stall a little longer ...
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#33978Posted by unregistered user at 5/23/07 10:50 p.m.36 Billin in one year while the case was under appeal,It's been how many years more than 10 since the first spill. How many Billions profit per year since then compared to loss of profit to the commercial fishermen, natives, and other peoples of the wet coasts?Could that much of an oil spill in northern oceanic waters been effective in accellerating Global warming more than individuals who usually choose transit if they can willingly instead of being forced to by anybody.Thank you for this announcement Joel Connely and the 9th circuit. The wheels of justice grind incredibly slowly but they do turn.
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#34222Posted by unregistered user at 5/25/07 9:03 p.m.Just remember who is in the Supreme court. 5 are conservatives and bush appointees who are big oil indentured slaves. money and time has reduced this in halve just think what will happen if this goes on for 2-3 more years. when has the little guy come out on the winning side in big money cases against big oil. I would be shocked if the fisherman get another dime
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