Exxon Mobil seeks reduction in $5 billion punitive damage award

Posted: Thursday, June 13, 2002

ANCHORAGE (AP) -- Exxon Mobil Corp. filed a motion Wednesday in federal court seeking to reduce a $5 billion punitive damage award from the Exxon Valdez oil tanker spill.

Exxon Mobil spokesman Tom Cirigliano said the company is following up on a decision by a panel of the 9th U.S. Circuit Court of Appeals last November.

The appeals court panel found that the $5 billion awarded by an Anchorage jury in 1994 to thousands of commercial fishermen, Alaska Natives, property owners and others harmed by the spill was excessive. It ordered the Anchorage court to reduce the award.

The appeals court later refused to review its decision. Exxon Mobil had until Monday to file its motion.

Exxon Mobil argues that the punitive damages should be $25 million -- the amount of the fine imposed by the government for the spill. It also says the punitive damages should not exceed $40 million, or twice the compensatory damages awarded to private plaintiffs.

''Pocket change,'' said Patience Anderson Faulkner of Cordova, when asked about the amounts suggested by Exxon Mobil. ''It is going to amount to no money at all.''

Faulkner worked with lawyers on a class action suit following the spill to chronicle the damage and submit claims against the company.

Faulkner said the effects of the spill continue to devastate the community of about 2,500 people at the southeastern end of Prince William Sound. A fishing permit before the spill cost more than $200,000, she said. Now one cost $40,000 and two-thirds of the purse seiners have given up.

Exxon Mobil has maintained that Prince William Sound fully recovered from the massive oil spill years ago.

The spill occurred in 1989 when the 987-foot oil tanker ran aground on a reef, spilling nearly 11 million gallons of crude. It was the worst spill in U.S. waters in history.

A report issued earlier this year by the Exxon Valdez Oil Spill Trustee Council found that the area, while not yet recovered, was on its way. The council was set up in 1991 to oversee the restoration of resources hurt by the spill using the $900 million paid by Exxon to settle civil charges.

Molly McCammon, the trustees' executive director, said 13 years after the spill more oil than expected remains in the sound but there has been no discussion about additional cleanup. The council funded additional cleanup in 1998.

Scientists with the National Marine Fisheries Service in January said an estimated 10,000 gallons of oil remains buried under the shoreline.

Exxon Mobil says immediately following the spill Exxon -- which acquired Mobil Corp. in 1999 in an $81 billion merger -- paid $300 million to more than 11,000 Alaskans and businesses.

Exxon also paid $2.2 billion on the cleanup from 1989 to 1992, when the state and the Coast Guard declared it was complete. And it paid $1 billion in settlements with the state of Alaska and the federal government.

Cirigliano said Exxon Mobil has paid about $3.5 billion as a result of the spill.

''Certainly we can say $3.5 billion dollars is certainly a deterrent to Exxon Mobil or any other company to make sure this never happens again,'' he said.

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