Journalism in the Public Interest

A Year After Gulf Tragedy, Offshore Oil Companies Still Shielded by Liability Limits


(Deepwater Horizon Response/Flickr Images)

When the Deepwater Horizon disaster killed 11 men at sea last April and set off the worst oil spill in U.S. history, the tragedy exposed a number of weaknesses—not least of which were decades-old laws that limited the liability of major players.

The Oil Pollution Act capped the amount BP owed in damages for the spill at $75 million—a legal limit that, under public pressure, BP ultimately volunteered not to invoke.

BP and its contractors also were shielded by maritime laws that limited how much victims’ families could win by filing lawsuits. Because the deaths took place offshore, the companies could only be sued for future wages, minus taxes and expected living costs, and not for pain and suffering or other punitive damages commonly recoverable in fatal onshore accidents.

Transocean, the owner of the sunken rig, also has invoked a 160-year-old maritime law to limit its liability to about $27 million—the value of the rig—in personal injury and wrongful death cases. Whether that holds up in court remains to be seen.

In the year that has passed since the spill, efforts to raise or do away with these liability restrictions have failed. Lobbying by the oil industry, the U.S. Chamber of Commerce, and the cruise ship industry, together with opposition from some lawmakers from oil-producing states, delayed and ultimately killed legislation that would have lifted all three liability limits.

In January, the presidential commission investigating the Deepwater Horizon disaster released its final report and issued a few key recommendations, such as lifting the $75 million liability cap on economic damages.

Fran Ulmer was on that commission. In a call with reporters last week, she criticized Congress for its inaction on the liability limit.

“It hasn’t been changed in 20 years. It really shows you how inadequate it is,” Ulmer said. “If you don’t raise the liability limit, you’re in a situation where either taxpayers end up footing the bill, or injured parties do, which seems fundamentally unfair.”

BP has said the $75 million cap is “irrelevant” because the company already promised to pay “all legitimate claims” for economic damage. (Here’s how that turned out.) The American Petroleum Institute, the major oil industry trade group, told lawmakers last June that while “changes are needed” to the liability cap, removing it or raising it arbitrarily could kill jobs, reduce offshore production and harm U.S. energy security.

Tell that to Keith Jones, for whom the issue of oil company liability is personal. Jones’ son, Gordon Jones, died instantly in the April 20 blast, leaving behind his widow, Michelle, and two young sons. The Jones family has spent much of the past year fighting to get Congress to change the Death on the High Seas Act and put potential liability for offshore accidents on par with liability for onshore accidents. Litigation over Gordon’s death is ongoing.

Several Deepwater Horizon families have settled wrongful-death cases. Some received settlements in the $8 million to $9 million range, according to the Wall Street Journal.

Jones, who is also an attorney, told me that for the Deepwater Horizon incident, public attention, as well as the federal government’s civil suit against BP and its partners, have made larger-than-required settlements politically expedient. But that doesn’t mean that the law limiting liability shouldn’t be changed, he said.

“The sad truth is that pretty soon somebody else is going to get killed on high seas. It’s going to happen again,” Jones told me.

And if that incident causes less environmental damage and gets less attention, those victims’ families may have to contend with the liability limits, he said. Without the public pressure, those companies may not be willing to settle for any more than they must. 

“It needs to be changed,” Jones said. “If all these companies can care about is money, then they need to keep in mind that when they put men at risk, that costs money too. If you can’t bring yourself to consider it for any other reason, think of it that way.”

With most of our politicians (on both sides) in the pockets of the oil companies, we’ll NEVER see any change to these caps!  It’s sad that people have to fight to get what is owed to them for the death of a family member….who can put a dollar amount on someone’s death and the future they MIGHT have had?

Like organized crime, government and corporate are only concern about their financial position and future.  The human death and animal deaths do not register with these people, nor do they care.  It’s all about the #%@#&& money!

To avoid conflicting with the perspective that Corporate America has bought from our Supreme Court and our Congress, we should tell our soldiers…our policemen…to commit whatever war crime or brutality strikes their fancy, and not they as individuals but instead our government will assume “responsibility” for whatever bestial acts they commit.

Financial responsibility limited to the corporate entity is bogus.  Everybody talks about corporate responsibility, corporate ethics, corporate accountability, corporate profits, corporate campaign donations…


It is the individuals who run the corporations who direct that corporation down the path of buying elections and renting politicians…who direct that corporation to place profit over the preservation of this planet and its life - be that life human or not; be that life living or yet to come…or never to come because of the actions of the individuals who run that corporation.

It is the people who run the corporation who must be held accountable; who must be forced to be responsible.

Until we dispense with the utterly ludicrous concept of a corporation as a “person”, we - the human race - have nowhere to go but down.

Ever notice - with the exception of Koch Industries - that you don’t hear about big privately held corporations crapping all over our children’s futures?  You look at SC Johnson, M&M Mars, and so on and you find they’re working to eliminate any damage they do and even leave all that they touch improved.

But a publicly-held corporation?  What has a “stock certificate” become except the proof that you have given a CEO a shield against accountability and responsibility?  Against culpability?

What is a “share” in a public corporation, now, but evidence that you’ve give a CEO license to destroy?  A license, even, to kill?

Thanks Marian-

Yes, BP played some dangerous games with safety before Deepwater Horizon, even going so far as to hide a nearly identical blowout 17 months earlier.  If BP hadn’t covered up the earlier blow-out and several other spills and explosions caused by penny-pinching mania, it’s likely the 11 men on that rig would be alive. 

  I’ve just returned from a three-continent investigation of BP for Britain’s current affairs program, Dispatches.  The findings aren’t pretty.  And we’re not done

You can follow our investigation into BP, Deepwater Horizon and more, at:

N.B.  I’m going to label BP the industry Bad Boy. This is about an industry-wide system that condones silence, the withholding of life-and-death information.

Bill@ etf trend trading review

April 20, 2011, 5:51 p.m.

Hi, cool post. I think the effects of the oil spill in the Gulf will be long term, despite all the efforts that are taken… we should do all in our power not to allow things like that to happen.

This is just another case of the undue influence of lobbyists and our gutless congress!  Why can’t we develop “reasonable” laws for doing this kind of stuff.  No one is entitled to become obscenely rich from a misfortune.  And if criminality is involved, someone should go to jail.

I am so sick of this kind of thing.

Michael Iverson

April 21, 2011, 12:30 p.m.

ibsteve2u is totally correct. The corporation has standing an an individual in perpetuity also free speech and thanks to a totally corrupt supreme court now has unlimited capacity to control the outcome of elections. Thom Hartman on Free Speech Channel has uncovered the 1841 Supreme court ruling, which was changed by a clerk in the justice’s employ to affect a ruling which had no intention of doing what it finally did; this was because that clerk was an employee of the rail road whose corporate future was affected by the ruling and because of that “error” we are today suffering like it was foretold in Orwell’s “1984”. Congress needs to address this anomaly and put things right…..kill the corporation as an aberration just like one would eradicate a cancer or other highly toxic substance, which needs confinement. The problem with politicians is that they are greedy by nature and only wish to get enough money so that they can live comfortably and once they are “elected” they join a totally insulated class from the rest of us….they do not have to share our health system nor do they need our social security…..I guess our politicians are also cancers….WHAT DO YOU THINK?

No more underwater oil drilling. Those rats that work at this do not to pay for their mistakes should be in jail. Also Republicans belong in jail also .together with Haliburten.

tampa personal injury lawyers

Nov. 29, 2011, 11:49 p.m.

If you have been injured due to someone’s negligence ,it would best to mind all your actions because some insurance companies will do anything to save the money from compensating your injury. Best to always sought the best ones in town.

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