Jindal postpones signing bill that would have killed lawsuit against oil companies

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wwltv.com

Posted on June 2, 2014 at 4:05 PM

Updated Wednesday, Jun 4 at 6:21 AM

David Hammer / Eyewitness News
Email: dhammer@wwltv.com | Twitter: @davidhammerWWL

BATON ROUGE – Gov. Bobby Jindal agreed Monday to postpone signing a controversial bill that would kill the lawsuit brought by a New Orleans area levee board against 97 oil and gas companies.

The move came after legal scholars raised concerns about whether the legislation would inadvertently derail pending state and local oil spill claims against BP – and after Jindal’s office had announced he would sign it.

Jindal called a news conference Monday to sign Senate Bill 469, to nullify a levee board lawsuit that the governor considers “frivolous.”

But less than three hours after inviting reporters to the news conference in Baton Rouge, he instead announced that "out of an abundance of caution," he agreed to give Attorney General Buddy Caldwell more time to review the bill’s ramifications.

Senate Bill 469 already passed both houses of the Legislature, after some other proposals did not move forward. It was put together largely by Jindal’s former executive counsel, Jimmy Faircloth. When asked by WWL-TV if the oil industry played a role in crafting the legislation, Jindal said several “stakeholders” participated.

The bill, if signed by the governor, would retroactively strip any levee board of the authority to file a lawsuit like the one by the Southeast Flood Protection Authority – East, which seeks to make oil and gas companies pay for their share of coastal restoration costs and -- theorizing that the damage they caused added to the stress on the levee system -- also asks the companies to cover additional operation and maintenance costs the board has incurred.

Over the weekend, four law professors issued a memo stating that the broader language of SB 469 could inadvertently jeopardize claims already filed by the state of Louisiana and some parishes and other agencies against BP, for economic and natural resources damages caused by the oil giant’s 2010 oil spill, which raged for 87 days and fouled hundreds of miles of coastline.

The scholars were led by Robert Verchick of Loyola Law School and Zygmunt Plater of Boston College, who was chairman of the Alaska Oil Spill Commission’s Legal Task Force after the 1989 Exxon Valdez tanker spill. It was that incident that led to the federal law under which Louisiana is suing BP, the Oil Pollution Act of 1990.

“The state of Louisiana under OPA has already lodged claims for natural resources damage, based on BP,” Verchick said. “But SB 469 appears to instruct the state that it may not pursue claims other than those for property damage.”

Last week, the Bureau of Governmental Research questioned if Senate Bill 469 would leave the state in a weaker position to make claims, particularly claims for ongoing costs of operation and maintenance of the levee systems.

“SB 469 basically eliminates all causes of action except those that are specifically listed, basically actions related to permit violations under the Coastal Management Act,” BGR President Janet Howard said.

BGR sent lawmakers a series of questions about who would have the authority to make the claims lodged by the levee board, but did not receive a response.

Asked by WWL-TV, Jindal said, "The state still has its standing."

Jindal, while giving Caldwell additional time to review, was confident that the bill would not hurt either the state’s ability to keep suing BP or to possibly pursue separately some of the claims asserted by the levee board.

“We’re certainly not going to do anything that impedes the ability of our people to file and pursue their legitimate claims resulting from the 2010 explosion, the BP explosion,” Jindal said. “It’s our attorneys’ opinion that this law – the bill that was passed – would not do that. It’s obviously a state law, and the (BP) claims are being filed under federal law.”

Faircloth said that’s a key point that should remove any concerns raised by the law professors. The economic and environmental damage claims against BP were filed under the federal Oil Pollution Act and it clearly supersedes any state laws.

Also, Faircloth said the bill he helped write is about lawsuits arising from events in the Coastal Zone, not the BP spill, which originated in federal waters 50 miles offshore.

Verchick said that BP could easily contest the state’s authority to pursue its claims against it, however, based on its operations in the Coastal Zone that failed to keep oil out of Louisiana’s marshes. Faircloth said OPA expressly pre-empts state law and the 5th Circuit Court of Appeals has already ruled to that effect.

“The opinion (by the professors) is clearly grounded in advocacy for the levee lawsuit, rather than an objective analysis of the law,” Faircloth said.

Verchick acknowledged that he is in favor of the flood authority lawsuit, but said he supports it because it’s the strongest effort to collect money he believes is owed to support critical coastal restoration.

While Verchick acknowledged that OPA trumps state law, he said preemption only ensures that Louisiana still has claims. But Verchick remained concerned that SB 469 would essentially prevent Caldwell and his high-priced outside lawyers from “pursuing” those claims any further.

Faircloth said the language of the bill was carefully tailored to safeguard the BP claims and local governments were consulted. Still, after spending millions already on outside law firms in the BP litigation, Caldwell is now taking more time to consider the warnings.

 

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