Recent Developments in Oil Pollution Act Litigation

• Date: 01 November 2016

11-2016 NEWS & ANALYSIS 46 ELR 10913

D I A L O G U E

Recent Developments in

Oil Pollution Act Litigation

Summary

Congress enacted OPA in 1990 following the Exxon

Valdez oil spill, to strengthen the federal government’s

ability to prevent and respond to oil spills, to establish

nancial resources to aid response, and to raise stan-

dards for contingency planning. It is an area of law that

is still evolving, particularly in the wake of the 2010

Deepwater Horizon spill and subsequent developments

in Gulf of Mexico restoration and recovery. A number

of recent cases have since dealt with issues related to

the spill. On June 28, 2016, the Environmental Law

Institute convened a panel of experts to discuss recent

events in oil pollution law, including the resolution of

Deepwater Horizon civil penalties and developments

regarding natural resource da mage assessments and

liability. Below, we present a transcript of that discus-

sion, which has been edited for clarity and readability.

Russ Randle (moderator) is a Partner at Squire Patton

Boggs LLP.

Karen A. Mig none is a Partner at Verrill Dana, LLP.

Steven O’Rourke is a Senior Attorney in the Environmen-

tal Enforcement Section, U.S. Department of Justice.

Cyn S arthou is Executive Director of the Gulf Restora-

tion Network.

Russ Randle: One of the lessons that may be learned

out of Deepwater Horizon cases stems from there being a

relatively expedited resolution of these cases, which dem-

onstrate what an able district judge and magistrate can

accomplish if they set their minds to it.1 It was roughly six

years from the incident to the civil penalty settlement, and

that is really a ne record for these ocers of the judicial

system. is case has been the focus of the oil industry and

environmental community for quite a number of years,

and there will be lessons learned in the natural resource

damage (NRD) arena as we go forward. But there a re, I

think, some well-founded criticisms of the settlement. e

1. e Environmental Law Institute has a database of litigation on the Deep-

water Horizon oil spill at http://www.eli.org/deepwater-horizon/deepwater-

horizon-oil-spill-litigation-database, and detailed materials on the settle-

ment and related processes at http://eli-ocean.org/gulf.

judge I used to work for said a good sett lement is one that

leaves no one satised, so I th ink we’ve met that standard

here. But the comments show that there are substantive

concerns that perhaps too much of the settlement proceeds

go to economic development and not enough to actual res-

toration of the Gulf.

So, with that, I’m going to turn it over to Steven and

listen with great interest to the lessons learned out of the

trial of the Deepwater Horizon case.

Steven O’Rourke: I’m supposed to talk about the settle-

ment of the BP case.2 Probably a lot of people know a fair

bit about it. In 2010, the Deepwater Horizon drilling vessel,

drilling a well called the “Macondo” well, lost control of the

well and experienced a blowout. ere was an explosion on

the rig. Unfortunately, people died or were injured. en,

the rig burned for two days. It eventually sank a nd oil was

released from the well for about three months, accu mulat-

ing on the shoreline for more than one thousand miles and

spreading across 43,000 square miles of the ocean.

So, we led a case against BP a nd others—Transocean,

the owner of the rig, and t wo other defendants who were

investing partners. We only  led two claims. We led a

claim under the Clean Water Act (CWA)3 for civil penal-

ties. We did not le a claim under the Oil Pollution Ac t

(OPA)4 for NRD. Maybe you’re thinking: this is supposed

to be an OPA seminar; what’s he doing talking about the

CWA? Don’t forget that when OPA was passed in 1990,

it not only created what we think of as OPA today. It also

amended the CWA. When the Valdez happened, the pen-

alties available for civil penalties were just $25,000 per day.

And that was a quick spill, but a huge volume of oil. So,

when they passed OPA, they added a volume-based civil

penalty in addition to a daily-based civil penalty. Anybody

who was watching this spill saw the volume coming out.

is obviously had the potential to be enormous, with

potentially billions of dollars in civil penalties.

e NRD aspect of the case also looked at the volume

of oil and considered penalties. e Valdez was a $900-mil-

lion NRD settlement. e Deepwater Horizon wa s 20

years later with a much larger volume of released oil, so

one could expect, even before the assessment, that it would

2. e consent decree is available on the U.S. Department of Justice (DOJ)

website at https://www.justice.gov/enrd/deepwater-horizon.

3. 33 U.S.C. §§1251-1387, ELR S. FWPCA §§101-607.

4. 33 U.S.C. §§2701-2761, ELR S. OPA §§1001-7001.

Copyright © 2016 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.