Publication Date: 4/23/2008
Source: Toxic Tort Client Alert
Author: Heidi Kossuth
Contact: heidi.kossuth@steptoe-johnson.com
At 12:04 a.m. on March 24, 1989, an estimated 10.8 million U.S. gallons (40.9 million liters) of crude oil were spilled into Prince William Sound when the Exxon Valdez, a single hulled oil supertanker was maneuvered out of the shipping lane to avoid icebergs only to strike Bligh Reef while trying to return to the shipping lane. In 1994, an Anchorage, Alaska jury in the case of Baker v. Exxon awarded $287 million for actual damages and $5 billion for punitive damages.
Among other allegations asserted by the plaintiffs, Exxon allegedly exhibited a slow response to the cleanup because several of the first efforts: application of a dispersant, a trial burn, displacement of the oil with high-pressure hot water and finally mechanical clean up were largely ineffective. Jurors answered 72 questions presented to them and reviewed evidence for almost five weeks before reaching their decision.
Exxon appealed the original decision to the 9th U.S. Circuit Court of Appeals causing a reduction in the punitive damages to $4 billion. Exxon appealed that decision on the basis of a subsequent Supreme Court ruling in a similar case. Ultimately, the 9th Circuit Judge Russel Holland increased the punitive damages to $4.5 billion plus interest. After additional appeals and oral arguments before the 9th Circuit the punitive damages award was reduced to $2.5 billion with the court citing United States Supreme Court rulings limiting punitive damages.
On May 23, 2007, the 9th Circuit Court of Appeals denied Exxon’s request for a third hearing on its appeal of the $2.5 billion dollar punitive damage decision. Exxon appealed to the United States Supreme Court which agreed to hear the case. On February 27, 2008, the Court questioned lawyers for Exxon and the plaintiffs for approximately 90 minutes. Exxon’s position is that punitive damages in excess of $25 million are not justified because the spill resulted from an accident and Exxon has spent $2 billion cleaning up the spill and an additional $1 billion in related matters.
The United States Supreme Court is expected to publish its decision before the Court’s term ends in July. Be on the watch for the decision probably sometime in June, 2008.
This alert is a periodic publication of Steptoe & Johnson PLLC and should not be construed or relied upon as legal advice or legal opinion on any matter. The content is intended for general information purposes only, and you should consult with your own lawyer for legal advice or a legal opinion on the specific facts and circumstances of your own situation. For further information about this alert, please contact Steptoe & Johnson PLLC.
Among other allegations asserted by the plaintiffs, Exxon allegedly exhibited a slow response to the cleanup because several of the first efforts: application of a dispersant, a trial burn, displacement of the oil with high-pressure hot water and finally mechanical clean up were largely ineffective. Jurors answered 72 questions presented to them and reviewed evidence for almost five weeks before reaching their decision.
Exxon appealed the original decision to the 9th U.S. Circuit Court of Appeals causing a reduction in the punitive damages to $4 billion. Exxon appealed that decision on the basis of a subsequent Supreme Court ruling in a similar case. Ultimately, the 9th Circuit Judge Russel Holland increased the punitive damages to $4.5 billion plus interest. After additional appeals and oral arguments before the 9th Circuit the punitive damages award was reduced to $2.5 billion with the court citing United States Supreme Court rulings limiting punitive damages.
On May 23, 2007, the 9th Circuit Court of Appeals denied Exxon’s request for a third hearing on its appeal of the $2.5 billion dollar punitive damage decision. Exxon appealed to the United States Supreme Court which agreed to hear the case. On February 27, 2008, the Court questioned lawyers for Exxon and the plaintiffs for approximately 90 minutes. Exxon’s position is that punitive damages in excess of $25 million are not justified because the spill resulted from an accident and Exxon has spent $2 billion cleaning up the spill and an additional $1 billion in related matters.
The United States Supreme Court is expected to publish its decision before the Court’s term ends in July. Be on the watch for the decision probably sometime in June, 2008.
This alert is a periodic publication of Steptoe & Johnson PLLC and should not be construed or relied upon as legal advice or legal opinion on any matter. The content is intended for general information purposes only, and you should consult with your own lawyer for legal advice or a legal opinion on the specific facts and circumstances of your own situation. For further information about this alert, please contact Steptoe & Johnson PLLC.
