Democracy for Vancouver

For John Roberts, there’s nothing playful about being the devil’s advocate:

Chief Justice John Roberts was pained.

Exxon Mobil, the giant oil corporation appearing before the Supreme Court yesterday, had earned a profit of nearly $40 billion in 2006, the largest ever reported by a U.S. company — but that’s not what bothered Roberts. What bothered the chief justice was that Exxon was being ordered to pay $2.5 billion — roughly three weeks’ worth of profits — for destroying a long swath of the Alaska coastline in the largest oil spill in American history.

“So what can a corporation do to protect itself against punitive-damages awards such as this?” Roberts asked in court.

The lawyer arguing for the Alaska fishermen affected by the spill, Jeffrey Fisher, had an idea. “Well,” he said, “it can hire fit and competent people.”

The rare sound of laughter rippled through the august chamber. The chief justice did not look amused.

…[I]t was clear that the court’s main motive in hearing this case was to cut the jury award. When Fisher said he thought the justices had agreed to hear the case because of an unsettled aspect of maritime law, Scalia cut him off.

“That,” the justice said, “and $3.5 billion.”
…
A jury awarded them $5 billion in punitive damages — a record level, for a record disaster — and an appeals court cut that in half. Now, the Supreme Court seems inclined to deal another insult to the victims (as many as a fifth of whom have already died) by cutting the award further.

Arguing for the Alaskans, Fisher, a tall and lanky Stanford professor with unruly gray hair, pointed out to the justices that the spill “destroyed an entire regional economy.” Yet Exxon fired only one person, Capt. Joseph Hazelwood, who even the oil company admitted was drunk at the time of the accident, while executives received bonuses and pay raises. “What you have today are 32,000 plaintiffs standing before this court, each of whom have received only $15,000 for having their lives and livelihood destroyed and haven’t received a dime of emotional-distress damages,” Fisher argued.

Several justices, however, seemed more concerned about the emotional distress of the Exxon executives…

Roberts seemed the most agitated as he argued that Exxon wasn’t responsible for the captain’s unauthorized drunkenness. “I don’t see what more a corporation can do,” he said. “What more can the corporation do other than say ‘Here is our policies’ and try to implement them?”

That’s why they call it strict liability, guys: because you can’t shrug off liability simply because you didn’t intend to hurt anyone.

Exxon is doing a dangerous, potentially calamatously hazardous business and profiting handsomely by it. Part of their investment risk, then, is that one of their ship captains might drive one of Exxon’s enormously profitable tankers up on a reef.

I, myself, cannot see the value in risking so much for mere profits - but I am a tree-hugging, coast-loving commie without need of a $145,000 a day retirement package.

Exxon took the risk and won big - while fucking up one of the most pristine coastal areas in the world. Part of the cost of doing business is paying the goddamn punitive damages when corporate practices lead to disaster.

Were I a justice, my only question for Exxon would be: how many hundreds of millions have you paid your lawyers over the past 19 years while trying to keep this punitive damage award at bay? (Answer: $781 million, so far.) And how much of the Alaskan Coast and its inhabitants could have been made whole if you had spent those millions on a settlement instead?

Because mens rea - state of mind - matters, particularly in punitive damages cases. If Exxon’s corporate state of mind had been to protect the natural resources it exploits as carefully as it protects its profits, the M/T Exxon Valdez might never have found Bligh Reef, and there would be no need for punitive damage awards at all.