August 27, 2008

Partial Settlement Reached on Exxon Valdez Punitive Damages

The Associated Press is reporting (via the Seattle Post Intelligencer) that the parties in Exxon Shipping Co. v. Baker have reached a partial settlement.

As anyone reading this blog probably knows by now, the U.S. Supreme Court cut the punitive damages in that case down to $507 million earlier this year, but the parties have continued to fight about the amount of interest that should be added to that amount. The plaintiffs contend Exxon owes interest from the date of the original judgment, for a total of about $488 million. Exxon contends that it doesn't owe any interest at all, but if it does, the interest did not start running until June 25, 2008, when the Supreme Court issued its decision.

Apparently, Exxon has agreed to pay $383 million now, but intends to continue litigating over the interest issue. If all of the $383 million went to the 33,000 commercial fisherman in the plaintiff class, they'd get about $11,600 each. That's on top of roughly $500 million in compensatory damages Exxon already paid (approx. $15,000 per plaintiff). If the plaintiffs prevail on the interest issue, the additional $488 million plus the remaining balance of the punitive damages ($124 million), would come out to about $18,500 per plaintiff. So the maximum recovery per plaintiff seems to be around $45,000. Of course, a big chunk of the payments will go towards attorneys' fees and costs. At the end of the day, the plaintiffs might end up with less than $25,000 each, even in a best case scenario (i.e., including the maximum interest award that plaintiffs are seeking).