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Environmental Section Summer 2010 State Bar of Georgia law EnvironmEntal Section Summer 2010 inside this Crisis in the Gulf of mexico: issue: The Deepwater Horizon Oil Spill & The Oil Pollution Act By Holly P. Cole, Esq., andrea l. Pawlak, Esq., Jennifer l. Pennington, Esq. and Crisis in the Gulf of Jared Sawyer1 Mexico ....................1 The Deepwater Horizon Oil Spill: With only a 60-70 percent estimated success OSAH Reporter ........6 rate, this plan also failed. With this last failure, n April 20, 2010, the Deepwater BP began more desperate methods, including Horizon oil rig exploded at Canyon soliciting suggestions for stopping the spill on its HSRA Rule Changes Block 252 off the coast of Louisiana. website. BP is now digging a relief well with an OThe explosion killed 11 workers and injured Result in Lower expected finish date in August 2010. Hundreds many others. Oil began gushing into the ocean Risk Reduction of lawsuits have already been filed against the when the blowout preventer (“BOP”), which Standards, Greater parties involved. was intended to prevent the release of oil in Cost in Cleanup ........7 such an explosion, failed. The list of potentially An internal BP memorandum shows key responsible parties includes BP, PLC (“BP”), sensors and tests indicated a problem with Interbasin Transfers of Transocean, Ltd. (“Transocean”), Halliburton the pressure within the well leading up to the 6 Water ......................10 and Cameron International (“Cameron”). BP blow-out. The BOP, manufactured in 2001, leased the Deepwater Horizon from rig owner was retrofitted for the Deepwater Horizon.7 and operator, Transocean.2 Halliburton cemented Transocean had a safety report done in 2001 Georgia General the well’s base but has claimed that it merely on the BOP which showed 260 possible failure Assembly 2010: followed BP’s instructions in doing so.3 Cameron scenarios with the equipment.8 The BOP was Environmental Issues made the blowout preventer (“BOP”), the “steel installed anyway. BP has acknowledged a series Wrap-Up ................15 monsters” which are supposed to “guard the of troubling actions taken by the company. For mouth of wells,” for the Deepwater Horizon.4 In instance, BP used a riskier method to seal the 9 addition, the Minerals Management Service has well before the blast for financial reasons. BP’s Counting Down to come under sharp criticism for its lax regulatory CEO, Tony Hayward, has agreed that it is an 2012: Update on policies, including letting “industry officials “entirely fair criticism” to say that BP does not the Tri-State fill out their own inspection sheets,” accepting have the tools to handle a deepwater oil leak.10 Water Wars .............17 “gifts, like tickets to sports events and pricey dinners, from oil companies, and, “[i]n at least The Oil Pollution Act of 1990: one case, an investigator may have conducted an In the aftermath of the Exxon Valdez oil 2010 Environmental inspection while tripping on meth.”5 spill, Congress passed the Federal Oil Pollution Law Section Since the explosion, BP has tried a number Act of 1990 (“OPA”), 33 U.S.C.A. § 2701 et Officers ...................24 of unsuccessful maneuvers to stop the flow of seq., which establishes a federal cause of action for the recovery of oil spill cleanup costs and the oil. First, a dome-like object was lowered 11 to try to cover the cracked pipe. The plan was compensation to those injured by such spills. abandoned after the dome crystallized. Next, The OPA “represents Congress’s attempt to William Sapp a long tube was placed into the pipe in an provide a comprehensive framework in the area of marine oil pollution.”12 It does so by Chair attempt to siphon some oil to waiting surface tankers. According to BP, the siphoning was imposing strict liability on parties responsible for Adam Sowatzka vessels or facilities from which oil is discharged met with minor success but large volumes of oil 13 Editor continued to spill. Then, a procedure known as for pollution removal costs and damages. To “Top Kill” was used to reduce the pressure of the demonstrate that a party is liable for damages well so that BP could permanently seal the pipe. under OPA, a plaintiff must prove that: (1) defendant is a “responsible party”; (2) for the “facility” or “vessel”; (3) from which oil was discharged; (4) into a local issue that should be decided at home, the destruction of or upon the navigable waters or adjoining shorelines; and (5) the Louisiana economy and the environment that supports this that the discharge resulted in removal costs and damages.14 economy is that issue.” The OPA requires the government to designate a responsible The Oil Pollution Act contains a savings provision for party.15 In a series of statements since the explosion, the Obama admiralty and maritime law claims, “[e]xcept as otherwise Administration has identified BP as the “responsible party.”16 provided in th[e] Act.”27 The Eleventh Circuit has held that claims The U.S. Coast Guard has since added Transocean to the list of brought pursuant to OPA are not subject to the constraints of “responsible parties.”17 these Limitation proceedings or Rule F of the Supplemental Rules While the OPA appears to create a straight-forward cause of for Certain Admiralty and Maritime Claims.28 OPA explicitly action against a responsible party, it also has several complicated supersedes the liability limits with respect to claims for cleanup procedural components. Most notably, a party seeking damages costs and damages resulting from a discharge of oil and establishes under the OPA must first present the claim to the responsible its own schedule of liability limits for damages resulting from the party in accordance with OPA § 2713(a).18 Section 2713 imposes oil discharge.29 In addition, the Eastern District of Louisiana has a mandatory condition precedent to the existence of jurisdiction held that OPA preempts general maritime law claims and that over private actions brought under the Act.19 This is because the the parties asserting claims arising from oil spills must pursue legislative intent of OPA was to encourage settlements and reduce claims covered under the OPA only against the party designated litigation in oil spill cases.20 BP has initiated a claims process by the government as the responsible party, rather than against whereby injured parties can make claims for damages (economic other parties involved in the incident.30 Amidst the background of and personal) suffered as a result of the oil spilling into the Gulf.21 public and government outrage, Transocean has taken a step back In statements since April 20, 2010, BP has stated that it accepts stating the limitation will not apply to claims against it under the responsibility and has promised to compensate people for all OPA.31 On May 26, 2010, Judge Ellison clarified his decision in legitimate claims.22 BP has set up claims centers along the Gulf an Amended Order stating that its order “does not apply to any Coast and posted an online claims form on its website.23 However, direct claims asserted against Petitioners under the Oil Pollution the claims process has been hotly criticized. Gulf area residents Act, 33 U.S.C. § 2701, et seq.”32 complain that claims centers were without phones or computers a month after the explosion. Nonetheless, as of June 21st, BP said it OPA’s Procedural Requirements: has paid out over $105 million from the 65,000 claims submitted The OPA provides that if the party “to whom the claim is in the Gulf Coast region.24 presented denies all liability for the claim, or the claim is not settled by any person by payment within 90 days after the date Maritime Exoneration or Limitation of Liability: upon which (A) the claim was presented, or (B) advertising Taking a different approach, Triton Asset Leasing GmbH, was begun pursuant to section 2714(b) . whichever is later, Transocean Holdings, LLC, Transocean Offshore Deepwater the claimant may elect to commence an action in court against Drilling, Inc. and Transocean Deepwater, Inc. (collectively the responsible party or guarantor or to present the claim to “Transocean”) filed a petition for exoneration or limitation of the Fund.”33 A claim is defined in the OPA as “a request, made liability in the Southern District of Texas on May 13, 2010.25 The court had a hearing at 12:30 p.m. that day regarding Transocean’s petition. Hon. Keith Ellison granted Transocean’s motion and limited Transocean’s liability to $26 million.26 Additionally, Ellison granted Transocean’s motion directing all claimants to file in Houston, Texas. A Motion to Transfer was filed on Friday, May 14, 2010, by Natalie Roshto, individually and as personal representative of Shane Roshto and her minor son, Blaine Rostho. She requested that Judge Ellison transfer the matter to the Eastern District of Louisiana which, she argued, is the site of the explosion and oil spill and is where most of the claimants and physical evidence are located. Roshto contended that she was the first to file suit regarding the explosion of the Deepwater Horizon. (Her husband, Shane Roshto, was aboard the Deepwater Horizon at the time of the explosion.) In her Motion, Roshto argued: “If ever a case presented Summer 2010 Page 2 in writing for a sum certain, for compensation for damages or removal costs resulting from an incident.”34 A court may dismiss a plaintiff’s complaint for failure to adequately describe the nature or extent of the damages.35 In order to present a claim within the meaning of the OPA, courts have held that claimants must follow the U.S.
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