IMAGE: HOMES SUBMERGED BY WATER AND OIL SPILL
Louisiana Department of Environmental Quality
These and hundreds of other homes in Meraux and Chalmette, La., saw a double whammy from Hurricane Katrina: floodwaters and an oil spill. The area has since dried out, leaving oil-tainted residue on homes, lawns and other property.
msnbc.com staff and news service reports
updated 1/13/2006 4:04:30 PM ET 2006-01-13T21:04:30

A judge is weighing whether to allow a class-action lawsuit against an oil company in the most damaging oil spill tied to Hurricane Katrina.

Murphy Oil told the judge Thursday that it had already paid more than $50 million to homeowners, had spent more than $13 million on cleaning up public property and had spent another $4 million to clean up private property.

Some homeowners sought a class-action lawsuit after about 1 million gallons of oil at Murphy's refinery in Meraux, La., southeast of New Orleans, spilled during Hurricane Katrina and flowed into their neighborhoods with floodwaters.

U.S. District Court Judge Eldon Fallon has not said when he will rule.

Murphy said it had made settlement payments involving more than 5,400 people in 1,800 homes. Company lawyers argued that its approach would be better than the lengthy litigation involved in a class-action suit.

Murphy has not disclosed individual settlements but last month a local official said it was offering homeowners about $11.40 per square foot as well as $2,500 per resident.

10,000 homes?
But lawyers for the plaintiffs said the spill damaged 10,000 homes in an area of six square miles. Much of the hearing Thursday focused on where the oil had spread.

Murphy blames the spill on Katrina, but the suit seeks to find Murphy negligent for not properly securing the storage tank that leaked after being rocked by floodwaters.

“The release of crude oil from Murphy Oil turned a community otherwise contaminated by floodwater into a community contaminated by toxicants,” said Joe Bruno, an attorney for the residents. “The dominant issue is the necessity of a community-wide cleanup.”

In a class action, one suit is filed on behalf of a large number of people who have similar claims.

Sixty-four named plaintiffs have joined to file a class-action suit, and about two dozen people already have filed individual lawsuits against Murphy, based in El Dorado, Ark. Those could be merged into a class-action case.

The Associated Press and Reuters contributed to this report.

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