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Litigation
Insights May 27, 2010
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Litigation Practice
Group Leader
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Deepwater
Horizon Oil Spill to Produce Decades of Litigation
The April 20,
2010 Deepwater Horizon oil rig explosion in the Gulf of Mexico killed
eleven people and created a massive oil spill that is currently
impacting the coasts of Louisiana and Mississippi and is threatening
the coasts of Alabama, Texas and Florida. A number of unknowns,
such as the size of the spill, changing ocean currents, and the
effectiveness of repair attempts, have made it difficult to predict
the ultimate impact of the disaster. Nonetheless, even in the
face of these uncertainties, the litigation floodgates have already
blown open. To date, more than 100 federal court cases have
been filed across the Gulf Coast. Defensive pleadings have also
been filed in various tribunals that are either aimed at curbing the
number of lawsuits or controlling the vast geographic sprawl of the
cases.
Thus far, the plaintiff's bar has brought a number of wrongful death
lawsuits in addition to an array of putative class actions
representing a wide and overlapping cross-section of people and
business interests, including fishermen, beachside condominium owners
and managers, restaurants, and seafood processors. One suit
filed in early May by an Arkansas plaintiff even seeks to represent
anyone in the country who made a nonrefundable deposit on vacation
property in the area. Barring a near term resolution to the oil
spill, experts predict a geometric expansion in the number of people
and business interests throughout the country who will be affected by
the oil spill, including insurance companies that provided insurance
to current and future defendants.
On the defense side, at least two of the initial defendants have
taken action to stem the tide of lawsuits against them. On May
7, 2010, BP filed a motion in the United States District Court for
the Southern District of Mississippi that seeks to stay a decision of
the Judicial Panel for Multidistrict Litigation regarding over 70
federal lawsuits against BP. BP has asked the Mississippi federal
court to consolidate lawsuits in Houston. BP's motion is
opposed by a competing plaintiff's motion which seeks a Multidistrict
Litigation. Also, the oil rig operator, Transocean Ltd., filed
a proceeding on May 13, 2010 in Houston under the Limitation of Shipowner's Liability Act,
(Act of Mar. 3, 1851, ch. 43 § 3, 9 Stat. 635), which is a 19th
century federal law that Transocean argues limits its exposure to
$26.8 million - or the value of the sunken rig - despite Transocean
having already collected $401 million to date from its rig insurers.
The Exxon Valdez oil spill that occurred in Alaska on March 24, 1989
spawned nearly two decades of litigation. As environmental
damage from the Deep Horizon spill continues to expand, another
decades-long legal battle to determine liability and damages for the
Deepwater Horizon spill seems inevitable.
If you have
questions regarding this article or topic, please contact the
contributor or your Clark Hill attorney.
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For further information
about the content of this Litigation Insight Update, please contact
Dan Scully. To find out more about Clark Hill and our Litigation
team, visit clarkhill.com
or call 800.949.3124
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