Liable Without Limitation
BP sued for damages ‘without limitation’ in Gulf Oil disaster
The lawsuit, filed yesterday in federal court in New Orleans, is the first brought by the U.S. over the oil spill caused by the explosion of the Deepwater Horizon rig in April. The Justice Department’s civil investigation is continuing, as is a probe of potential criminal violations.
The lawsuit seeks damages under the Clean Water Act and to declare four of the defendants liable under the Oil Pollution Act for all removal costs and damages caused by the oil spill, including damages to the environment, according to a Justice Department statement. The lawsuit doesn’t ask for a specified amount of damages.
“The United States has sustained, and will continue to sustain significant costs and damages,” government lawyers said in the complaint. The U.S. “seeks in this action the imposition of Clean Water Act civil penalties for each barrel of oil that the defendants discharged into the Gulf of Mexico.”
The Clean Water Act authorizes the U.S. to seek civil penalties of $1,100 for each barrel of oil spilled, or in certain circumstances, as much as $4,300 a barrel from the companies involved, government lawyers said in a September filing with court in New Orleans. The government reported in August that 4.9 million barrels were spilled.
Kathryn Kranhold, BP spokeswoman, declined to immediately comment.
In addition to London-based BP, the owner of the well, defendants in the lawsuit include units of Vernier, Switzerland-based Transocean Ltd., which owned the rig, Anadarko Petroleum Corp. and MOEX Offshore 2007 LLC, part owners of the well that ruptured. Anadarko is based in the Woodlands, Tex. Mitsui & Co. owns 70 per cent of Mitsui Oil Exploration Co., which holds 10 per cent of the field where the Macondo well is located through wholly owned U.S. subsidiary MOEX Offshore, according to the Mitsui Oil website.
BP’s insurer, an underwriting unit of Sydney-based QBE Insurance Group Ltd., also was named as a defendant, though it can only be held liable up to the amount of insurance policy coverage under the Oil Pollution Act and isn’t being sued under the Clean Water Act.
The lawsuit alleges violations of federal safety and operational regulations that caused or contributed to the oil spill that began when an explosion and fire destroyed the Deepwater Horizon offshore drilling rig in the Gulf of Mexico.
Each defendant, other than the insurer, “caused or contributed” to the spill, the U.S. said in today’s complaint. These defendants failed “to take necessary precautions to keep the Macondo Well under control,” failed to use “the best available and safest drilling technology,” failed to protect personnel and failed to maintain equipment and materials, the government said.
Halliburton Co., which provided the cement to plug the well, wasn’t named as a defendant in the lawsuit.
Other defendants and claims could be added later, said Holder.