Exxon Valdez Dragged Back Into
Public Eye: Oil Giant Playing
With PR Fire By Claiming It Has
Taken More than Enough
Responsibility
The
Supreme Court will decide
whether a $2.5 billion punitive
damages award against Exxon
Corp. (now Exxon Mobil)
for its role in the 1989 Exxon
Valdez oil spill in Alaska was
excessive The justices agreed to
hear the case Monday, and oral
arguments will be held sometime
next year. The suit was brought
by fishermen, landowners, local
governments and native Americans
who claimed private economic
harm from the spill. The company
claimed it had already paid many
millions in government fines, as
well as $3.4 billion in cleanup
costs, CNN reports.
A jury
originally awarded $5 billion in
1994. A federal court later cut
that amount in half, but it
still was believed to be the
largest punitive damages
judgment of its kind in U.S.
courts. Much of the initial
blame in the accident was placed
on Capt. Joseph Hazelwood,
whose alleged alcohol abuse was
found to have contributed to
mistakes that let the ship to
run aground. The company and the
plaintiffs used different
arguments when citing
Hazelwood's actions, in efforts
to boost their respective cases.
The
issue was whether, based on past
high court precedent limiting
punitive awards, the judgment
was too high. The company argues
it should not have to pay any
damages, and that the case has
dragged on too long. Special
maritime laws govern these kinds
of disputes, and previous such
cases will be important
benchmarks when the justices
grapple for a ruling, reports
CNN producer Bill Mears.
Lawyers
for the plaintiffs said the
company has deep financial
pockets, and even a
multibillion-dollar judgment
amounts only to "barely more
than three weeks of Exxon's net
profits." Exxon Mobil issued a
news release saying it welcomes
the Supreme Court's decision.
"This
case has never been about
compensating people for actual
damages. Rather it is about
whether further punishment is
warranted in a case where the
company voluntarily compensated
most plaintiffs within a year of
the spill, and has spent over
$3.5 billion, including
compensatory payments, cleanup
payments, settlements and fines.
We do not believe any punitive
damages are warranted in this
case," according to the news
release issued by company
spokesman Tony Cudmore.
"It is
also important for the Supreme
Court to uphold long-standing
maritime law that provides that
ship owners are not liable for
punitive damages based upon
conduct by the ship-master who
disregarded the owner's rules
and policies," the company said
in the statement.
The
high court has generally tried
to limit punitive damages that
are deemed "excessive." Last
term, it threw out a $79 million
award to an Oregon smoker's
family who claimed tobacco giant
Philip Morris contributed
to his death by cancer. The
justices, in their divided
ruling in that case, said in
most cases punitive damages
should match "actual" damages.
In the
Exxon case, a federal appeals
court said the company should be
given some credit for paying for
the cleanup costs. A ruling is
expected by late June.
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