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Vol. 12, No. 52 Week of December 30, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

Exxon brief outlines Valdez argument

The Associated Press

Exxon Mobil Corp. says a punitive damages verdict of $2.5 billion for one of the worst U.S. oil spills contradicts 200 years of maritime law.

That is essentially its argument going before the U.S. Supreme Court next year, according to a recent court brief the company filed.

The Exxon Valdez tanker hit a reef in Prince William Sound and spilled 11 million gallons of crude oil that marred more than 1,200 miles of coastline in Prince William Sound 18 years ago.

The Irving, Texas, oil company has been fighting the civil judgment, originally set at $5 billion, since the 1994 trial.

ExxonMobil has held that it should not be responsible for the ship’s captain, Joseph Hazelwood, who the company says violated clear company rules when the ship ran aground on March 23, 1989.

In its brief, filed Dec. 17, the company asserts:

• Punitive damages should not be “awarded against a ship owner based solely on the conduct of a ship’s master.”

• Punitive damages for spills such as the Exxon Valdez are “not available in federal maritime tort actions.”

• Maritime law does not permit punitive damages.

Plaintiffs: law not current

The plaintiffs’ attorneys have argued that the maritime law Exxon embraces no longer has current application. Rather, it was meant for ships leaving port with the risk of not being seen by their owners for months, if not years. Technological advances mean communication is ongoing, they argue.

The company says it took immediate responsibility after the accident and spent $3.5 billion in compensation, fines and cleanup.

The company says even the reduced civil judgment of $2.5 billion is excessive and wants the U.S. Supreme Court to overturn the trial and appellate courts collective rulings.

Gov. Sarah Palin has said the state of Alaska will file a legal brief supporting the 33,000 plaintiffs mired in a dispute with Exxon Mobil.

Palin said Alaska Attorney General Talis Colberg will file an amicus brief with the U.S. Supreme Court by early next year.

Such legal filings reflect backing for one side of an argument, but come from someone not directly involved with the case.

Exxon has already had such backing from business groups and shipping associations, including the American Petroleum Institute and the U.S. Chamber of Commerce. Both object to the size of the verdict.

The company’s shares rose 64 cents, or 0.7 percent, to $92.07 in afternoon trading Thursday.

On the Net: www.exxonmobil.com/corporate/ and www.supremecourtus.gov/.



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