BP, 8 other companies sued by Justice Dept. over gulf oil spill
Thursday, December 16, 2010
The Justice Department sued BP and eight other companies Wednesday over the Gulf of Mexico oil disaster, the federal government's first legal filing in its broad investigation of the worst oil spill in U.S. history.
The lawsuit accuses BP and other firms of violating federal regulations and failing to prevent the April 20 explosion and fire, which destroyed the Deepwater Horizon offshore drilling rig. It seeks civil penalties under the Clean Water Act and a second federal statute for cleanup costs and widespread damage to the environment.
Although the Justice Department did not spell out an amount, legal experts said the case could expose the companies to tens of billions of dollars in fines, under civil environmental laws. Justice officials emphasized that the filing - on the day of a deadline for civil filings - is a first step and that aggressive civil and criminal probes into the disaster are continuing.
"Even though the spill has been contained, even though it is no longer the focus of round-the-clock news coverage and the subject of front-page headlines," said Attorney General Eric H. Holder Jr. at a news conference Wednesday, "the department's focus on investigating this disaster, and preventing future devastation, has not wavered."
Scott Dean, a spokesman for London-based BP, said the government's filing in federal court in New Orleans was expected and "does not in any manner constitute any finding of liability or any judicial finding that the allegations have merit." He said the company - whose stock price dropped sharply during Holder's announcement, then partially recovered by day's end - is cooperating with all government inquiries.
Other companies involved in the spill and named in the lawsuit affixed much of the blame on BP. Brian Kennedy, a spokesman for Transocean, which leased the Deepwater Horizon rig to BP, said: "Responsibility for oil and natural gas discharged from a well lies solely with the well's owner and operator. . . . Transocean is indemnified in this matter."
John Christiansen, a spokesman for Anadarko Petroleum Corp., a minority owner of the well, said the company was "not involved in the operations or decisions that occurred on the drilling rig." MOEX Offshore, another minority owner, said in a statement that it had "no authority or responsibility to direct activities on the Deepwater Horizon."
The Justice Department civil probe is on a parallel track with a criminal investigation that Holder said is "very serious." Law enforcement officials and other sources have said the criminal investigation is focusing on BP, Transocean and engineering giant Halliburton, which was in charge of cementing the well.
Sources said the FBI and other investigators are examining whether, in addition to violating environmental laws, company officials made false statements to regulators, obstructed justice or falsified test results for devices such as the rig's failed blowout preventer. Another line of inquiry, sources said, is whether the companies' cozy relationship with federal regulators contributed to the disaster.
Halliburton, which has declined to comment on the investigation, was not named in the civil lawsuit. The suit is expected to become part of broad civil litigation pending in U.S. District Court in New Orleans. Nearly 400 lawsuits against BP and other companies - filed on behalf of fishermen, environmental groups and others in the Gulf of Mexico region - have been consolidated before the same judge.
Justice Department officials said their participation will give them access to documents and other materials handed over in pretrial discovery, which will aid the government's broader civil and criminal probes. Officials said the timing of their filing was related to Wednesday's deadline set by the judge.
The 27-page document says the companies failed to use the safest drilling technology and to maintain equipment "necessary to ensure the safety and protection of personnel, equipment, natural resources, and the environment." It offers little evidence for those assertions, but officials said additional grounds - and defendants - could be named later.
Roger Marzulla, an environmental lawyer who headed the Justice Department's environment division in the Reagan administration, said it appeared that "the government got rushed by the court's deadline. They filed as generic a complaint as possible and figured 'we'll sort it all out later.' "
Experts said the legal standard to prove liability under the Clean Water Act and the Oil Pollution Act - the other law under which the government sued - is low. "You just have to show that an event occurred and that a particular entity or person is responsible," said William Carter, a former federal environmental prosecutor. "Anything short of an act of God - a lightning bolt hitting something - and that person is going to be responsible for the cleanup."
Under the Clean Water Act, if the government can prove that BP or other companies engaged in "gross negligence," each firm could be fined up to $4,300 per barrel of oil spilled. Nearly 5 million barrels were spilled into the gulf, according to federal estimates.
"Tens of billions of dollars is certainly a legitimate prospect here," Marzulla said.