deepwater horizon - some observations oprofessor erik røsæg oscandinavian institute of maritime...
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Deepwater Horizon- some observations
oProfessor Erik RøsægoScandinavian Institute of Maritime Law
[email protected]/erikro
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The parties
o BP – operator
o Transocean – owner of rig
oHalliburton – cement contractor
o Cameron - owner of blow-out preventer
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Criminal and administrative penalties
oNegligent pollution is an offenceoClean Water Act 33 USC 26 III
oWhich negligence standard?
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Civil liability and limitation
o OPA= 33 USC 40 I; CWA = 33 USC 26 IIIo Strict statutory liability to USCGo Torts
o Strict liabilityo TransOcean not responsible for spills directly
from the well (after average)?o Feinberg fund
o Secure claimso More liberal than courtso Requires settlement with BPo USD 20 bn; 3 bn actually paid in
o Oil Spill Liability Trust Fund (26 USC I 98 A)
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Limitation
o Separate limits for USCGo Transocean has filed for limitation for
death/personal injuries (46 USC App 8; Jones Act = 46 USC III § 30104)
o No other filings for limitation at this stageo Breaking of limits – violated federal safety
regulationso Personal injuries: Value of vessel after incident +
pending freighto USD 75 millo USD 26.8 mill paid to Transocean from hull insurers
o Adverse publicityo OPA limits (33 USC 40 I § 2704)o Reform proposals
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The problem of frivolous claims
o “Spillionaires”o “Vessels of opportunity”o Ice to vessel engaged in
skimming
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Claims – principles
o Hadley v Baxendale – remoteness (156 E.R. 145; (1854) 9 Ex. 341)
o Robins Drydock & Repair Co. v. Flint – proprietary interest (275 U.S. 303)
o OPA loss of profits recoverable if “due to …” (33 USC 40 I § 2702)
o Jones Act –potential dependents (wife of deceased 9 months pregnant)
o Mitigation o Ignorance of law – TV ads, billboards etco Retroactive law reforms?
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Claims – natural resources
oNatural resourcesoRestoring (how to clean the
wetlands?)o Loss of useoAlternative amenities
o Long term ecological effects (cp. herring not returned to Prince Williams Sound)
o Possible oil at sea bottom
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Claims – public bodies
o Loss of taxesoUse of public servants (firemen
etc)
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Claims - other
oMoratorium of drilling – loss of other oil companies
o Loss of ‘way of life’o Indochinese refugeesoDecrease in bikini waxingo Strip clubs in the town of
Hummer
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Direct action against insurers in Louisiana
o BP insurance strategy(1993) 6 JACF 3, 4-15
o Accident in Louisianao International watersoEEZ irrelevant
o Policy entered into or delivered in Louisiana (La RS 22:1269)
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Recourse
o Knock for knockoWillful misconduct or gross
negligence
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Removal organization
o Preident – USCG – on scene coorinator (local czar)
o Jones Act – cabotage exception(46 USC V D § 55113)
o Role of BP
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Procedure
oMulti-district litigation panelo Consolidated in New Orleans