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Ear to the Ground

Supreme Court Slashes Exxon Valdez Penalty

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Posted on Jun 25, 2008
NOAA

Cleanup workers hose down an oil-soaked shoreline shortly after the Exxon Valdez spill.

Nineteen years ago, the Exxon Valdez supertanker struck a reef in Alaska, causing an environmental catastrophe so devastating its impact continues to be felt. A court later slapped Exxon with $5 billion in punitive damages, but on Wednesday the Supreme Court ruled that the oil giant shouldn’t have to pay more than about a tenth of that amount.


New York Times:

The Supreme Court on Wednesday reduced what had once been a $5 billion punitive damages award against ExxonMobil to about $500 million. The ruling essentially concluded a legal saga that started when the Exxon Valdez, a supertanker, struck a reef and spilled 11 million gallons of crude oil into the Prince William Sound in Alaska in 1989.

The decision may have broad implications for limits on punitive damages generally. Punitive damages, which are meant to punish and deter, are imposed on top of compensatory damages, which aim to make plaintiffs whole.

Justice David H. Souter, writing for the majority in the 5-to-3 decision, said a ratio between the two sorts of damages of no more than one-to-one was generally appropriate, at least in maritime cases. Since Exxon has paid about $507 million to compensate more than 32,000 Native Alaskans, landowners and commercial fishermen, Justice Souter said, it should have to pay no more than that amount in punitive damages.

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By RHONDA, June 26, 2008 at 12:22 pm Link to this comment
(Unregistered commenter)

THIS RULING IS OBSCENE!

This crime is unprecedented, and so the punishment should reflect the crime.  As an Alaskan I cannot describe to you the horror and devastation of the Exxon spill, except to say it compares to the destruction of the twin towers in my mind.

Exxon, by holding up this case in court for almost twenty years, has devalued the money paid to Alaskans who were injured, devalued the lives of these people who had the losses (nearly 200 have died waiting for compensation) and devalued the wildlife and environment.  They had the money to pay the award when it was first determined, and they had the money to fight the court battle.  And they can afford to fight in court endlessly.  Shame on the court for not shutting their case down.

I want to write more, but I am emotionally overwhelmed at this point.

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By Bloopie, June 26, 2008 at 9:04 am Link to this comment
(Unregistered commenter)

NewsmaxTV’s Ashley Martella reports the Supreme Court Liberals rule IN FAVOR of child rapists!
http://video.newsmax.com/?assetId=V2558190&promo_code=6356-1/

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By purplewolf, June 26, 2008 at 6:58 am Link to this comment

This is no surprise. The full amount would be less than what is in the petty cash box in the secretary’s drawer to these big oil crooks. One of the reasons behind this may be because a lot of this has affected the lively hoods of Native peoples in the area, hunting, fishing, etc., and that in itself makes it of little consequence to the the people who make the final decisions.

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By Jim Yell, June 26, 2008 at 6:14 am Link to this comment
(Unregistered commenter)

I remember an Exxon executive, who said at the time of the spill, to paraphrase, “we will just take it off our income tax, and the customer will pay.” Such arrogance, and why does the government leave this loop hole open? When the money is a fine for bad behavior, even criminal behavior than it should come out of the net profit and no deductions please.

I also remember that one “wag” was clever enough to observe “Exxon, the sign of the double cross”, true then and apparently true now. If anyone is paying attention it should be obvious even to those on the right that this is wrong.

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By michele, June 25, 2008 at 9:19 pm Link to this comment
(Unregistered commenter)

disgusting. but what do you expect with the kangaroo court bush has put in place ?

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By cyrena, June 25, 2008 at 8:46 pm Link to this comment

Well, this is really the shits. I think the victims should take this up with the World Court.

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By Jonathon, June 25, 2008 at 8:19 pm Link to this comment
(Unregistered commenter)

First of all,  what the heck took the Supreme Court so long?  This is disgraceful!  It’d been 2 decades since the spill and the court is just now getting to business!  I bet if this was some foreign oil ship we’d be holding sanctions, interrogating people at Guantanamo!

Secondly, how can they go from $5 billion in punitive damages to half-a-million?  Exxon says they only can afford $530 million after they just made $40 billion dollars each year the last three consecutive years?  Something smells fishy! 

Third, what does this have to do with the current drilling trying to be passed in ANWR?  I mean are they trying to play down the ‘89 oil spill in order to make people more confident, increase stocks, start drillig, etc?

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By Masonblue, June 25, 2008 at 7:59 pm Link to this comment
(Unregistered commenter)

More than any other segment of our corporatocracy, the oil companies need to be smacked in the only place that hurts and that, my friends, would be their pocketbooks. What was Souter thinking, to author this garbage?

EXXON knew the captain was a drunk and yet they permitted him to endanger a vast wild habitat because he needed another drink. That’s as reckless as reckless gets and I can think of no good reason to reduce Exxon’s liability for its gross irresponsibility when it already gouges us every day at the pump. The original award is chump change to Exxon. This reduction is the functional equivalent of saying, “Carry on.”

And what of the wildlife that perished strangling on oil? Compensatory damages make no sense to a wild habitat. Nine to one punitive damages don’t either, but at least it’s a penalty, however paltry.

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