Saturday, December 23, 2006
Exxon Valdez oil spill damages reduced
ExxonMobil caught a multibillion-dollar break from a federal appeals court Friday but the oil giant still must pay $2.5 billion in punitive damages for the 1989 spill in Valdez that has been called one the nation's worst environmental disasters.
The San Francisco-based 9th U.S. Circuit Court of Appeals ruled that the original $5 billion award exceeded new U.S. Supreme Court standards on punitive damage limits.
The 2-1 decision followed ExxonMobil's third appeal of the original 1994 jury award for 34,000 fishermen, many from Seattle, and other Alaskans financially harmed by the 11 million-gallon spill that oiled 1,500 miles of Alaskan coastline.
The ruling leaves both sides with similar opportunities to appeal to the U.S. Supreme Court in what has become one of the longest-running civil court cases in U.S. history. For the fishermen, it is a choice between asking a higher court to return to the original award weighed against the possibility that the oft-delayed case could be finalized within two years, said Dave Oesting, the Anchorage-based lead attorney.
"I'll be discussing this with my clients," he said. "I would expect, given Exxon's obstructionist tactics, that they will appeal."
For Exxon, it's nearly a final chance to set aside a record punitive award it has been fighting for more than a decade. ExxonMobil spokesman David Gardner said the company regrets the spill and that the company already has paid what it owes. ExxonMobil has made no decision on further appeal, he said.
"The company took immediate responsibility for the spill, cleaned it up, and voluntarily compensated those who claimed direct damages," Gardner said Friday. "This case is not about compensating people for damages. The plaintiffs have been compensated for damages and most were compensated within one year of the spill."
That simply isn't true said Stewart Deal, 53, a Ballard fisherman and plaintiff in the class-action case. Deal, a salmon gill-netter, estimates he lost more than $300,000 in income when the Prince William Sound fishery crashed after the spill.
"As I talk about this I feel my heart pounding," he said. "I try not to think about it, it's been so long. I think that the full $5 billion that the jury awarded was fair. But Exxon is indifferent to us."
Thousands of Seattle fishermen likely are owed millions of dollars, Oesting estimated. But because the case has dragged on for so long, nearly 10 percent of the plaintiffs have died.
In Friday's ruling, the court said ExxonMobil's "reckless misconduct" in the spill meant that the company should still pay hefty punitive damages.
Both sides have less than a month to either ask the 9th Circuit to empanel an "en banc" to review the decision or to appeal directly to the highest court in the nation. En bancs typically are used when there is a conflict in the appeals court decision.
Deal isn't expecting to see any money soon. "Based on their track record, Exxon is going to be happy to drag it out as long as they can," he said. "They are using their resources to take the justice system for a ride."
ExxonMobil officials got a touch of preholiday indigestion Friday when they discovered a replica parody corporate Web site set up by an unnamed hoaxer.
The Web site, www.exxonenergy.com looks strikingly similar to ExxonMobil's own site, www.exxon.com, and is complete with working contact e-mail addresses, rewritten corporate history, Valdez spill updates and links to news stories.
When asked about some information provided by the site, much of it not flattering, ExxonMobil officials initially expressed surprise, then anger.
"I'm speechless," said spokesman Dave Gardner when directed to the site. "It looks just like ours. But it's not. I've not seen it before."
The hoaxer, who initially tried to provide false information to a reporter, couldn't be reached for comment. Gardner said the oil giant would not sit idly by. "It is not an ExxonMobil Web site; it is a fraud. We will pursue this matter aggressively."
P-I reporter Mike Lewis can be reached at 206-448-8140 or firstname.lastname@example.org.