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Exxon back in court over 1989 Valdez spill fine

Exxon Mobil Corp.’s appeal of a $5 billion punishment for the 1989 Exxon Valdez spill was to be heard for the third time Friday in a federal appeals court in San Francisco.
Exxon Valdez Oil Disaster 15 Years Later
Oil tar from the 1989 Exxon Valdez spill is still found in Prince William Sound. This view on April 4, 2004, shows an oil-soaked rock taken from a beach on Naked Island near Valdez, Alaska. On the distant horizon is the Bligh Reef area where the ship ran aground.David Mcnew / David McNew / Getty Images file
/ Source: news services

It’s been nearly 17 years since the Exxon Valdez spilled 11 million gallons of crude oil along the Alaska coast in one of the country’s worst environmental disasters, and a jury’s $5 billion judgment against the company is still tied up in the courts.

Exxon Mobil Corp.’s appeal of that punishment was scheduled to be heard for the third time Friday afternoon in a federal appeals court in San Francisco.

The case stems from a 1994 decision by an Anchorage jury to award punitive damages to 34,000 fishermen and other Alaskans.

“This is almost the end of the road. This will not be reviewed again. They’ll pick the number and tell us what it is,” predicted Dave Oesting, lead attorney for the plaintiffs.

The residents claimed they were harmed when the Valdez struck a charted reef and spilled crude oil along about 1,500 miles of coastline. They alleged that the captain was drunk and that Exxon knew he had a drinking problem. The jury found Exxon and Valdez captain Joseph Hazelwood reckless in the accident.

Company willing to pay $25 million
Exxon argues it should have to pay no more than $25 million in punitive damages.

The corporation, which reported third-quarter earnings of $10 billion, says it has spent more than $3 billion to settle federal and state lawsuits and to clean the Prince William Sound area.

In two previous appeals, the 9th U.S. Circuit Court of Appeals ordered U.S. District Judge H. Russel Holland of Anchorage to reduce the judgment against Exxon, saying it was unconstitutionally excessive.

Holland begrudgingly complied in 2002, reducing it to $4 billion. Exxon appealed, and Holland was ordered to revisit the decision again. He called Exxon’s actions “reprehensible,” and set the figure at $4.5 billion plus interest.

Decisions in the 9th Circuit usually come weeks or months after the oral arguments. The appeals court has twice questioned the award, sending it back to the trial judge to reduce the fine.

Accrued interest could bring the total amount to nearly $9 billion, Oesting said.

‘The same kind of goo’
In the region itself, pockets of relatively fresh Exxon Valdez oil remain on shorelines as distant as Katmai National Park, about 300 miles from the site where the supertanker disgorged 11 million gallons of crude oil, according to government scientists who presented their studies at a conference this week in Anchorage.

“This stuff isn’t changing at all. It’s just the same kind of goo that got deposited there in 1989,” said Jeff Short, a National Oceanic and Atmospheric researcher.

According to the group that administers the settlement money paid by Exxon to the governments, only seven of 30 marine species, resources or services have recovered to pre-spill levels. Whether the spill is to blame and whether remnant oil is causing harm remains unsettled.

But a scientist who has worked for Exxon says that even if there are isolated pockets of lingering oil, it is not getting into the food chain.

“Is it ecologically relevant? No,” said David Page, the Bowdoin College biochemistry professor who has studied the spill on the company’s behalf.

“To say that it’s somehow causing damage when it’s part of the baseline, that’s not really scientifically correct,” said Page, who added that natural oil that seeps along Alaska’s coastline overshadows any lingering Valdez oil.

But Prince William Sound residents believe the spill triggered a cascade of environmental ills.

“As subsistence fishermen and hunters, we still see the effects of that oil spill just about daily,” said Gary Kompkoff, head of the tribal council in Tatitlek, a tiny Native village just a few miles from the Exxon Valdez grounding site.

He cited a dramatic fall in the number of herring as one of the most serious effects because herring make up much of the diet for other sea life. “If the herring don’t return, then we have nothing to harvest,” he said.

A decision in the case is not expected for several months.