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Class Action Lawsuit Seeks Punitive Damages for Oil Spill

A class action lawsuit was recently filed in the U.S. District Court in New Orleans seeking punitive damages from BP, Transocean Ltd., Cameron International, and Halliburton in relation to the BP oil spill in the Gulf of Mexico.

The lawsuit was brought by Corliss Gallo, a man owning land on Grand Terre Island, who claims that his property suffered environmental damage due to the oil leak and the related clean-up effort. His complaint alleges the “outrageous conduct” of the defendants constituted gross negligence and their conduct showed willful, wanton, and reckless indifference for the rights of property owners such as himself.

This suit is reportedly the first to address the issue of punitive damages in relation to the BP oil spill and will likely set the stage for a legal battle related to a 2008 U.S. Supreme Court decision. In the Exxon vs. Bakerdecision, the court limited the punitive damages related to the Exxon Valdez oil spill to a 1-to-1 ratio between compensatory and punitive damages. In effect, the decision reduced the punitive damages awarded in that case from $5 billion to $507.5 million.

However, in the Exxon case, the court seemed to leave open the question of whether higher punitive damages might be awarded if the defendant’s conduct was particularly egregious or was the result of malicious or dangerous actions undertaken with the purpose of increasing financial gain.

It appears the class action brought be Gallo will argue that the BP oil spill fits the exception laid out in the Exxon case. In its initial investigation of the spill, the Coast Guard has indicated that the initial explosion on the Deepwater Horizon rig may have taken place because various companies knowingly took risks by not utilizing certain safety equipment and also failed to keep certain safety features in good repair.

This class action is likely to become part of the multidistrict litigation to be heard before Judge Carl Barbier in federal district court in New Orleans.

Related Resources:

Oil spill class action call for punitive damages (New Orleans Times Picayune)

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