Hopes dashed as SC limits Exxon oil spill damages

A jury decided in 1994 that Exxon should pay $5 billion in punitive damages. In 2006, a federal appeals court cut that verdict in half. Wednesday’s decision to reduce the amount to one equal to about four days worth of Exxon Mobil’s last quarter profits was hailed by the business community and decried by environmentalists and Alaskans.

Justice David Souter wrote for the court that punitive damages may not exceed what the company already paid to compensate victims for economic losses, or $507.5 million.

The ruling, which reduced the amount owed by 80 per cent, comes almost two decades after the Exxon Valdez supertanker ran aground, spurting 11 million gallons of crude into the fishing waters of Prince William Sound that Cordova residents rely on for their livelihood.

Robert J Kopchak lost a quarter of his earnings when the Pacific herring fishery crashed in the early 1990s. He still owed thousands of dollars on two herring permits that are worthless today. “It really hurts,” he said of Wednesday’s ruling. “It gives big business the formula they need to calculate the cost of their actions when they destroy the environment. This gives them the formula to calculate their risk, period.”

Sylvia Lange, also of Cordova, used to fish commercially for salmon and haul for the doomed herring fishery. But for her, the spill was about more than lost money. It also was about the end of Alaska Native traditions and a subsistence lifestyle for several villages in the region.