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Exxon Valdez oil spill ruling overturned

Discussion in 'Business & Economics' started by The Scotsman, Jun 30, 2008.

  1. The Scotsman

    The Scotsman Well-Known Member

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    Okay Bunz specially for you! The award has originally set at $4.5Bn then on appeal went to $4Bn then back up to $4.5Bn then down to $2.5Bn now its on its way down to the lower court again for further review. The liability and negligence issue is not in dispute its the quantum of damages, thus the review by the Judges made according to US precident in Maritime Law....or at least that's the claim!

    In any event its quite topical based on the fact that the US wants to expand its offshore drilling!
     
  2. GenSeneca

    GenSeneca Well-Known Member

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    Did you just suggest there was a similarity to offshore drilling and the Exxon-Valdez disaster?

    This is an oil rig that collapsed, you may note the lack of oil in the water:
    [​IMG]
    This is the Exxon-Valdez with its hull ruptured:
    [​IMG]

    Offshore drilling will not cause a Valdez style ecological disaster.
     
  3. Federal Farmer

    Federal Farmer New Member

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    Hi Scotsman,

    The Valdez wasn't involved in transporting offshore oil, it was transporting oil from the pipeline terminal in Alaska to the lower 48 for refining.

    If you want to discuss offshore oil spills, you have to look to Mexico as the reigning "world champion" due to their Ixtoc I rig blowout in the Gulf of Mexico back in '79.

    The total reigning champion however still remains Saddam Hussein who ordered his troops to open the valves at the Sea Island Terminal on January 21, 1991 which dumped as much as 400 million gallons of oil into the Persian Gulf.
     
  4. The Scotsman

    The Scotsman Well-Known Member

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    you're serious???.....anyway good pictures....moving on to the article which is about the court case which I assume you had'nt read?
     
  5. Bunz

    Bunz New Member

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    Thanks for posting it Scotsman, as you can imagine there is more or less the entire state of Alaska very pissed about the decision. In general we were happy with the 2nd Amendment decision, but the Exxon one was unprecedented, unexpected and outrageous!
    Why even bother with what the jury who sat through 4 months of arguments decided, or even the various appeals courts. To slash the punitive damages such as this shows that corporate America can generally do as they please and if they have enough money can get away with anything.
    Reverting back to the 1818 law is a joke, and without merit in modern times.
    Exxon had a known alcoholic for a captain, who didnt even have a drivers license because of his past behaviors. Then he had 5 double vodkas while the ship was being loaded. Left his third mate in charge while he went below to sleep it off. Third mate hit a clearly marked and well known reef causing the spill. To not hold Exxon responsible for the actions of thier employee on this sort of scale is shameful.
     
  6. Bunz

    Bunz New Member

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    While I agree to a point, I am a believer in developing onshore oil resources, I am of mixed opinions when it comes to offshore, at least in Alaska. Because of the ice conditions. I am aware of thier existence in places such as the North Sea. But despite considerable research on my own, and having asked questions of experts in the field, I have yet to get a reasonable answer as to how one responds to a spill in ocean ice conditions. So in a way, there is some connection.
     
  7. Bunz

    Bunz New Member

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    Those were both tragic and at least in the case of Saddam, criminal, but he certainly paid that price didnt he.
    In the meantime, the likes of Lee Raymond and now Rex Tillerson dont dare show thier faces in Alaska. Lee Raymond arrived in the spill ravaged community of Cordova in the aftermath and said a now famous quote in Alaska.
    "We will make you whole again"
    Concerns for his safety has largely kept him out of the state that produces most of domestic product by Exxon. I am not joking one bit when I say that security above the level of getting onto an American jetliner would be necessary. I dont condone violence one bit, but I would bet a case of beer that a public event with Raymond and now Tillerson would result in bodily harm coming onto them from an Alaskan.
     
  8. The Scotsman

    The Scotsman Well-Known Member

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    ....that does seem to be the impression that one gets from this ruling. However, based on the fact that EXXON ultimately do not pay the claim its' paid by Insurers does it matter? The clean up and reinstatement, again paid for by Insurers, has been successful I understand?

    ... yeah..that was pretty much the basis for my thoughts on this ruling. An interesting dichotomy is the commercial drive for resources and the economic well being balanced against the conflict (potential or otherwise) with the protections offered by law in relation to the protection of the environment, protection of peoples livelihoods as well as the protection of rights expected under a corporate duty of care owed by those involved in exploration and development. The ever increasing price of crude makes previously marginal fields into viable economic propositions. Previously restrictive safety considerations could now be outweighed by pure economics so does the law (and this ruling) still act as an impartial arbitrator of risk? Perhaps as you suggest it may be time to review these laws in case the consequences of a breach in the duty of care is seen to be deferential to the corporate interest - then I guess serious conflicts of interest can arise.


    ...I think you miss the fact that the pilot was responsible for the course the vessel took :D

    If the situation is the same in the US as in the UK the pilotage is done under waiver (Pilot's non-liability) therefore the responsibility of the vessel whilst the pilot is on board is the sole responsibility of the pilot, although, the consequences of his actions are deemed to be that of the Shipping Company who employed him - the pilot steered the vessel onto the rocks and Exxon copped the rap - legally I mean?

    In any event I can understand your reaction as it does not exactly send the message that you would have wanted!
     
  9. Federal Farmer

    Federal Farmer New Member

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    While there is no doubt that the incident was in fact tragic, I fail to understand why any Alaskan would wish to harm someone who was in no way responsible for the accident. It is also my understanding that Exxon had people on sight the very day following the accident, and immediately began it's clean up efforts, which were far in excess of any clean up effort previously taken by anyone, and has already spent in excess of $3 Bn in cleanup, compensatory claims, as well as State and Federal claims. What more would you have had them do, than they have already done?

    Are the residents of Alaska also sufficiently enraged with the US Coast Guard for not providing sufficient and proper navigation aids thought those known treacherous waters that tankers were known to frequent?
     
  10. GenSeneca

    GenSeneca Well-Known Member

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    Yes, I read the article... it never mentioned offshore drilling.

    Which is why I failed to understand your jump in logic: equating an oil tanker crash with offshore drilling. If you wouldn't mind explaining that, perhaps I just misunderstood your point in that comment.
     
  11. Bunz

    Bunz New Member

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    It doesnt matter the claims are paid through insurance, that is what insurance is for. The cleanup has not been successful, yes most of the oil is gone, but I can bring you to miles of beach that just below the surface still has oil contamination. While wildlife has returned, it is still nowhere near pre-spill levels. A very valuable herring fishery has been more or less wiped out forever due directly to this. Being a subsistence advocate myself, I see the biggest and most unfortunate impact being on that of the various species used for subsistence. Herring, shrimp, clams, sea otters, seals, crab and various bottom fish are nowhere near pre-spill levels. Despite what Exxon "scientists" have to say.
    Firstly, I live in an oil producing state. Oil has brought untold wealth here, I understand that, and think we need to expand our oil producing efforts here. So I am not necessarily anti-oil, but I am certainly anti-Exxon. So I know we need to produce that resource. It has been largely done very safely all things considered, but one can never underestimate what a few idiots under the wrong circumstances are capable of.
    [/quote]
    Perhaps as you suggest it may be time to review these laws in case the consequences of a breach in the duty of care is seen to be deferential to the corporate interest - then I guess serious conflicts of interest can arise.
     
  12. Bunz

    Bunz New Member

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    A few things, firstly, Lee Raymond was the CEO of Exxon, therefore as the CEO of that company, any actions committed by the company, either to be cheered, and jeered, falls onto thier laps. But this really boils down to a few things. The actions and policies that lead to the spill happening, and thier actions afterwards. But his own personal behavior regarding the reaction to the spill led to much of the distaste here of him. Lets review.
    Exxon let a known alcoholic, who had multiple drinking and driving related crimes and a suspended drivers license at the time still command one of the largest commercial vessels in the world. Unlike most other transportation companies, they had a policy of only 4 hours from bottle to throttle. Meaning one had to quit drinking only 4 hours before operating the vessel. Whereas any company worth a damn has a minimum of 12 hours.
    But Lee Raymond, in the days after the spill arrived in Cordova, one of the nearby towns, and very much a fishing community who just saw thier entire economic base get pushed to extinction. He showed up to meet with people and put thier concerns to rest.
    He famously said, "We will make you whole again" Well that was the bull$hit statement of the decade for Alaskans. Then when faced with difficult questions he became abrasive and disrespectful. The dislike of him comes from his actions and policies alone. Nothing else. And yes I will say again, if he came to Alaska, especially on some sort of official business, it would be tough to ensure his personal safety. He is reviled here and rightfully so.
    Exxon had people on sight the moment the spill happened. Not just the next day, it was thier crew who spilled the oil. Immediate cleanup efforts mean little when the spill shouldnt have happened in the first place.
    If one drives down the sidewalk and runs over a pedestrian, does it make it better if they call the ambulance right away? Barely, because they shouldnt have been there in the first place.
    To answer the last question, what they could have done is not let this happen in the first place. Then they could have accepted what a jury decided in a fair trial through normal court proceedings, cough up and be a good corporate citizen. Instead they played the game of delay, deny and hope they die when it comes to dealing with the plaintiffs. During this whole window they have largely stalled on further investment in Alaska. Showing again they are not intested in being a good corporate citizen. So, now considering what has happened recently in the USSC. Look for the State of Alaska to continue its movement towards getting Exxon out of Alaska.

    [/quote]
    Are the residents of Alaska also sufficiently enraged with the US Coast Guard for not providing sufficient and proper navigation aids thought those known treacherous waters that tankers were known to frequent?[/QUOTE]
    You want to blame the USCG? Thier were plenty of navigation aides, we are talking about Bligh reef here. A very well known hazard in the area before the spill, that was marked clearly on charts and was generally well outside of the normal shipping lanes. I can understand moving out of the ice as they did, but they should have turned back into them 30minutes or so before they ran aground. The car driving equivalent would be to drive into a building that you could see coming for 5 miles. There is no excuse, except for criminal negligence in this action.
     
  13. Federal Farmer

    Federal Farmer New Member

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    So you're holding a man responsible for the actions of another, that he had no control over, whom he had never met, whom he never had heard of? Is that correct? Overall responsibility does belong to Exxon, who immediately began clean up, so it would appear that you've adopted the same illogical hysteria that the residents of New Orleans have. Alaskans BEGGED for Exxon to come up there and drill for oil, and the hazards were explained to everyone, yet you persisted. So they went up there, employed YOUR citizens, fattened YOUR wallets and YOUR economy on oil money, and now you want to complain about the scorch mark on your dress after you've been dancing with the Devil for all these years? PLEASE! You went into the relationship with the oil companies with your eyes wide open, you benefited from the oil money, now wear your scarlet letter with pride, you EARNED IT! To put it another way, you sound as silly as the town whore who screwed every drunken sailor in town and took their money, but is now suing to get her cherry back.

    While you may have evidence to the contrary, I have seen none that indicates that Hazlewood was a "known alcoholic" either to Exxon, or anyone else. I have also been unable to find any official indication of Exxon permitting it's ships masters to drink within 4 hours of taking their vessels to sea. It would also be pertinent to note that Hazlewood was not found guilty of being drunk by an ALASKA jury, and that his BAC was well below the level necessary for a conviction of DUI. Frankly, from what I saw when I was up there of the vast majority of your citizens being RAVING alcoholics (as noted by your signature line), his having 2 vodka's, 4 hours prior to departing makes him a tea-totler!

    So it all boils down to a bunch of over emotional people who simply don't "like" him. Got it. It's not the kind of thing I remember from my time in Alaska, but then again I wasn't in that area, perhaps the people are different.

    Ah, but if one runs onto a sidewalk to avoid hitting a school bus, and happens to hit a pedestrian, what then? The Valdez left the shipping lane to avoid icebergs, not to do some joy riding. Now while I readily acknowledge that Hazlewood should have been at the helm, and not turned his vessel over to such an inexperienced seaman, especially in such treacherous waters, while he retired to his cabin, the fact is that the seaman was rated, by the USCG, to handle the vessel, and it was he who violated Hollywood's orders to return to the shipping lanes almost an hour before the vessel ran aground.

    Ahh, it all becomes clear now, it's not about the Courts ruling, it's about the money. The Alaska ruling was null and void on it's face the moment it was rendered. Maritime law limits punitive damages to the same amount as compensatory damages, so the court ruled correctly in lowering the punitive damage amount. If the Judge in the original trial had followed the law, none of these appeals would have been necessary in the first place, and no delay would have occurred in the clean up efforts, or getting the punitive damages to the proper parties. Don't blame Exxon because your own Judge dropped the ball.

    No, the NTSB does. In the investigation following the grounding, the NTSB ruled that the Coast Guard failed to provide sufficient navigational aids and a sufficient vessel traffic system in Prince William Sound.

    As I said earlier, the mate failed to follow his orders and return the vessel to the shipping lane prior to his assigned deadline, that is NOT in question. What IS in question are the rules that allowed a vessel such as the Valdez to continue to operate outside the shipping lane in the first place, for such an extended period of time. Having grown up near the ocean, and having family in the shipping business, I'm more than a bit familiar with the rules relating to shipping traffic, and I can assure you that the Coast Guard rules in place in Prince William Sound for traveling outside the shipping lanes would have been found to be reckless even in the Gulf of Mexico, or in the Central Atlantic.
     
  14. Bunz

    Bunz New Member

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    No, I am holding him responsible for the actions of Exxon, the corporate entity that he was in charge of, as well as his personal behavior, comments and commitments.
    At least we can agree on this.
    Yeah thats a good argument :rolleyes:
    Two very different things entirely. You and I both know that.
    Firstly, the tone of most of this statement is unnecessary. I am not going to go down the road of you twisting my comments into quasi personal attacks at myself, an entire poppulation of a state. It is unbecoming, and shows an inability to have a serious discussion. Bring these types of posts elsewhere.
    I am not interested. But to address the one thing worthy of mentioning is that Exxon's relationship with the State of Alaska. There is no doubt it has been mutually beneficial. The state bent over backwards to accomodate oil development, and the other two major producers here, BP and Conoco Phillips have been very good stewards of the resource and excellent corporate citizens overall.

    Well, you might want to read up on it.
    http://www.adn.com/evos/stories/EV53.html
    Hmmm, BAC of .061 a full 10 hours after he was done drinking? He was aquitted of DUI in Alaska. The USCG found him to drunk to be in command of the vessel and suspended his license for 9months.
    This is the sort of comments that I address in my earlier statements. It is totally incorrect, and nothing but baiting and I will not tolerate this. If that is your sentiments, then do us all a favor up here and never return. :(

    What you are failing to miss entirely, the reason Hazelwood is culpable is because he is the captain of that vessel, and responsible for the operations of it, in its entirety. The guy at the helm at the time is also an idiot. No question. He ran a 900something foot tanker into a clearly marker navigation hazard on his chart.


    No, ultimately it is about the courts ruling. They took quite a hard line approach in favor of vessel owners and operators. I think it is generally quite short sighted and out of date with modern times.
    Also, my own judge? Why do I even bother? :rolleyes:


    Here is the main causes as found by the NTSB.
    (1) The third mate failed to properly maneuver the vessel, possibly due to fatigue and excessive workload;
    We have been over this. The man at the helm, third mate Cousins was obviously an idiot and should never have been left alone on the bridge. He probably shouldnt have been left alone in a skiff.
    (2) the master failed to provide a proper navigation watch, possibly due to impairment from alcohol;
    We have been over this.
    (3) Exxon Shipping Company failed to supervise the master and provide a rested and sufficient crew for the Exxon Valdez;
    There has long been speculation that Cousins was also under the influence of something himself at the time. Of course nothing proven, but Hazelwood and the crew were not entirely forth coming right away about what exactly went down, and had quite a bit of time alone to corraborate any story necessary.
    (4) the U.S. Coast Guard failed to provide an effective vessel traffic system;
    Again, a clearly charted hazard and was clearly marked on the ships chart. What they now have in place is a lighted bouy marker.
    (5) effective pilot and escort services were lacking.
    They now require pilot and escort until the vessels have cleared Hitchinbrook Island are more or less in the Gulf of Alaska. Whereas before they only needed to be on board while transiting the Valdez Narrows.

    Oh so again its the USCGs fault? :rolleyes:
    PWS is generally ice free, except for calving glaciers which is where you get the ice bergs from. They were well outside of where they were intended to be. One can make all the traffic rules they want, it doesnt prevent someone breaking them though.
     
  15. The Scotsman

    The Scotsman Well-Known Member

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    correct its about arguing sactions against those responsible for resultant oil pollution.

    well.....oil tends to get transported round the world in tankers and since many of the new fields being developed or under consideration (certainly now the price of oil makes them economically viable) tend to be offshore I just though they may use oil tankers to bring the oil to refineries?

    I suppose Exxon Valdez in a perverse sort of way was needed. Prior to the Bligh Reef spill crisis management and pollution response was ad-hoc and amature at best and coastgurd traffic management and pilotage was poor. The world learned a lesson that quick and effective spill response was needed and in most places well equipped and trained teams now exist.
     
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