Gulf Judges’ Oil Ties May Present Conflicts of Interest
Since BP's ruptured well began spewing crude into the Gulf of Mexico, more than 150 lawsuits have been filed in federal courts seeking damages for the harm that the environmental disaster has dealt to the livelihood of coastal fishermen and business owners. But finding judges to hear these spill-related lawsuits against BP, Halliburton and Transocean may be a challenge. More than half of the "64 active or senior judges in key Gulf Coast districts in Louisiana, Texas, Alabama, Mississippi and Florida" have ties to industry, according to The Associated Press.
Some judges own stocks or bonds in the companies named in the lawsuits. Some are related to plaintiffs' attorneys. Others even receive royalties from oil and gas companies. One judge, according to financial disclosure statements, is a member of Houston's Petroleum Club, an "exclusive, handsome club of, and for, men of the oil industry," reported AP.
Last week, half of the active federal judges in the New Orleans district recused themselves from hearing spill-related cases and several judges in Alabama have done the same, citing conflicts of interest. Judges must recuse themselves from presiding over lawsuits that involve a company in which they have a direct financial interest, but AP points out that the rule has its nuances:
For example, a judge does not have to step aside if the investments are part of a mutual fund over which they have no management control. Mere ties to companies or entities in the same industry, no matter how extensive, also don't require disqualification, according to legal experts.
Attorneys on both sides of the lawsuits have pushed for the cases to be consolidated before one judge. BP has recommended a Houston-based judge, Lynn Hughes, for his experience presiding over multidistrict litigation. According to McClatchy, Hughes has gone on paid trips lecturing for a petroleum geologists' association that has worked with BP and other industry players. He has also collected royalties for mineral rights from several oil companies, including ConocoPhillips and Devon Energy.
Some plaintiffs' lawyers have suggested a New York-based judge, Judge Shira Scheindlin, to be brought in because she has also handled multidistrict litigation, has no oil and gas investments, and has a background in environmental lawsuits.
A hearing next month will determine whether to the cases should be consolidated and, if so, which judge should handle the litigation.