Wednesday, September 24, 2014

Things Learned On The Playground

In 1989, the Exxon Valdez crashed off Prince William Sound in Alaska. The environmental effects of that crash still linger today; most of the wildlife populations monitored for damage in the aftermath have yet to recover and some look like they never will. Much of the oil is still there continuing to pollute the sound.

And also to this day, Exxon is still in court disputing their legal financial liability, even after the US Supreme Court weighed in in 2008.

It appears that the prospect of an oil company fighting to avoid having to pay out money for damage caused by an oil spill is not unique to Exxon, because BP is putting itself in the same category with the 2010 Deepwater Horizon spill. In 2012, BP did agree to pay out damages to people affected by the spill, but it didn't cover fines from the Clean Water Act that at the time the New York Times article we're linking to was written were pegged at around $21 billion, which BP opted to keep fighting. Total exposure at one point was estimated at about $40 billion, but as the settlement damages were uncapped, that wasn't a hard and fast number.

That total liability appears now to be nearing $50 billion and climbing, and not only is BP still fighting those, in order to get their overall payouts down, they attempted to reclaim some of the money already paid out in the settlement between August 2012 and October 2013, after judge Carl Barbier found the formula to calculate payments was incorrect and altered it accordingly in June. The problem for BP is that when the claimants agreed to drop their suits, they themselves agreed that no future court action could alter those payouts. BP could dispute future payments, but money already paid out is paid out. And that is what's now coming back to bite them, as Barbier is back at the gavel to say, in essence, no backsies.

If ExxonMobill's example is any indication, though, BP will be attempting to get those backsies one way or another for decades to come. And when they finally let the matter drop, the oil will still be sitting on the Golf Coast.

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