A high-profile court case in the United States, involving British-based oil multinational BP, has hardly been reported here. Yet it tells us so much about how giant companies and the law operate.
In April 2007 toxic chemicals poured into the air at the BP refinery in Texas City. Workers started to feel dizzy and fell ill with a variety of symptoms.
They researched what had happened and came to the conclusion they had been exposed to carbon disulfide while working on two refining units.
The plant had a terrifying safety record. A 2005 explosion had killed 15 people and injured 170.
The chief government official investigating the explosions—appointed by George Bush and therefore no die-hard opponent of oil firms—said the accident was preventable and that “risk denial and risk blindness” had not been addressed.
Subsequent legal action saw BP forced to pay $2 billion in compensation—the US’s largest ever safety fine.
The company was determined not to repeat that experience. So when in 2007 around 140 staff asked for $5,000 each to cover hospital costs arising from the fume emissions, BP suggested to the press that the entire incident might be a hoax by “disgruntled workers”.
Bosses said this “odour event” was not toxic and that workers could have just $500 each.
The multinational’s lack of care enraged a group of workers who decided to go to court—and they won. They won big.
A jury decided BP was guilty of gross negligence and ordered the firm to pay punitive damages of $100 million to the ten workers who brought the case.
If BP had paid the 140 the $5,000 they had asked for it would have cost it just $700,000. Now it was looking at a possible bill of $1.4 billion.
But BP bosses were determined to change the decision. BP spokesperson Ronnie Chappell said the company was “shocked and outraged” by the verdict, which was “unjustified, improper and unsupportable”. So BP appealed against it.
Last week, soon after BP announced profits of $14 billion for 2009, the case came to court again—this time without a jury.
US district judge Kenneth Hoyt set aside almost all of the damages that had been won in the first court case. His ruling included the finding that “the nature of refinery work is that workers are subject to a variety of toxic odours at all times. The defendant, the employees and contractors are fully aware of the potential hazards that exist in a refinery.”
Judge Hoyt was very familiar with BP. He had enjoyed an all-expenses-paid trip to an “educational event” part-funded by the oil giant.
The three-day long programme was hosted by the George Mason Law and Economic Center (LEC), an organisation that hosts judicial conferences and is funded by the big business firms that appear in court before federal judges.
LEC is no stranger to controversy. Three years ago, federal Judge Andrew Kleinfeld reduced the penalty against Exxon Mobil for the Valdez oil spill in 1989 that saw 11 million gallons of oil ooze into Prince William Sound. He had been on LEC trips partially funded by Exxon.
A jury had ordered Exxon to pay $5 billion damages. A series of judges’ rulings left it facing a bill of one tenth of that sum.
Tony Buzbee, an attorney for the workers in the BP case, says the decision to slash the damages gave the industry “a free pass from gross negligence.
“The judge acknowledges that BP is a bad actor, but, for whatever reason, decides that a jury who hears three weeks of evidence should be ignored.
“As far as this court is concerned, BP and any other person or entity, can injure, kill, pollute with impunity as long as they monitor for it.”
Buzbee is bringing more cases to court, and is determined to bring BP to justice. But for the moment the company can relax, particularly if you are BP’s chief executive Tony Hayward who has just grabbed a 41 percent pay rise to just over £4 million a year.