Supreme Court to Review Exxon Valdez Verdict

Eighteen years after the infamous Exxon Valdez oil spill, the Supreme Court granted review of the punitive damages award against Exxon Mobil in the resulting lawsuit. In granting review in Exxon Shipping Co. v. Baker, the Court indicated it would consider whether Exxon Mobil should face $2.5 billion in punitive damages in light of the fact that it has already paid over $3.4 billion in compensatory payments, cleanup costs, and penalties.

The suit was brought by fishermen, cannery workers, landowners, local governments, local businesses, and Native Americans and alleged private economic harm from the spill. The trial resulted in a punitive damages award of $5 billion. The Ninth Circuit Court of Appeals cut the punitive damages award in half in 1994, citing the fact that the spill was unintentional, the need to support moderate fuel prices, and the cleanup costs and penalties already incurred. The Supreme Court will decide whether Exxon Mobil should incur any additional penalties in the form of punitive damages. If the Court allows the award to stand, it will consider whether the remaining $2.5 billion award is excessive under due process.