WASHINGTON Lawyer Jeffrey Fisher closed his arguments at the Supreme Court over money damages awarded after the Exxon Valdez oil spill by invoking the thousands of Alaskans whose "lives and livelihood (were) destroyed" and are waiting to be paid.
During an intense 90 minutes Wednesday of give-and-take on Exxon's appeal of a $2.5 billion punitive damages award, the justices appeared closely divided.
The case could come down to a 4-4 vote, which would mean that a lower court judgment allowing the unprecedented $2.5 billion award would be affirmed. Punitive damages generally are assessed on top of actual damages to punish and deter misconduct. The Supreme Court's ninth justice, Samuel Alito, owns Exxon stock and is not participating in the dispute.
Key questions are whether such damages were permissible for the 1989 Exxon Valdez incident and, if so, whether they should be limited.
Justice Ruth Bader Ginsburg and the other liberal justices were skeptical of Exxon's arguments that the award should be voided because punitive damages are not allowed under maritime law. Chief Justice John Roberts and the other conservative justices were more doubtful of the Alaskans' stance that a ship owner could be punished for the actions of a captain. The captain left his post just before the crash dumped 11 million gallons of oil into Prince William Sound.
A jury in 1994 found captain Joseph Hazelwood and Exxon reckless. Evidence showed that Hazelwood, who had a record of alcohol-related problems, had been drinking before the incident. The jury awarded $287 million in actual damages and $5 billion in punitive damages. A federal appeals court cut Exxon's $5 billion assessment in half.
This lingering chapter revolves around commercial losses of a class of more than 32,000 commercial fishermen, business operators and landowners, Native Alaskans and municipalities. The high court's decision could broadly affect the shipping industry as well as other businesses and environmentalists.
Exxon's lawyer Walter Dellinger argued that the oil giant has been punished enough, noting that Exxon already has paid $3.4 billion in cleanup costs. That, he said, "is enough to deter anybody for anything."
But Fisher said those payments did not cover the specific economic losses of the Alaskans who brought the case. He said nothing in longstanding maritime law prevented the jury from punishing Exxon for the reckless acts of the vessel's captain.
Roberts asked whether shipping companies could be held accountable for employees' misconduct even when the companies have policies against drinking on the job and other misconduct. "What more can the corporation do other than say, 'Here is our policies,' and try to implement them?" he asked.
Fisher argued that Exxon did not truly implement its alcohol policy. He noted that it emerged at trial that Hazelwood had an alcoholism problem: "We showed 33 instances in the record of Exxon employees drinking with Hazelwood or learning that he drank," Fisher said.
Ginsburg referred to Exxon's decision to let him continue to operate the vessel and said: "So the jury could have found: Never mind the captain. Exxon, itself, is a grave wrongdoer because it allowed the tanker to be operated by a captain who was certainly not fit."