Prior to the Deepwater Horizon oil spill, the largest oil spill in U.S. history occurred on the night of March 23-24, 1989 when the hull of the tanker vessel Exxon Valdez ruptured after striking Bligh Reef in Prince William Sound, Alaska. Ultimately, the Exxon Valdez discharged approximately eleven million gallons of North Slope crude oil into the waters of Prince William Sound (Sound). The oil spread across nearly 1,500 miles of shoreline in the Sound and the Gulf of Alaska in the ensuing months, traveling, with the aid of wind and rough seas, as far as 600 miles to the south and west.
Under the direction of the U.S. Coast Guard and with advice from federal and state agencies and local communities, Exxon mounted a cleanup that extended into 1994 and cost the company more than $2.5 billion.
Environmental Impact of the Spill:
Effects of the Spill on natural resources and services included, in addition to the oiled shorelines and resultant loss of plants and invertebrates inhabiting them:
- the death of hundreds of thousands of seabirds and ducks
- the death of approximately 300 bald eagles
- the death of thousands of sea otters and harbor seals
- losses to two pods of killer whales
- disruption of the Prince William Sound herring and other commercial fisheries
- damage to many Native Alaskan archeological sites
- disruption to recreational, tourism and subsistence gathering services, and loss of passive uses
Civil Judicial Enforcement:
The Spill spawned thousands of private claims, many of which were prosecuted by private attorneys through a class action lawsuit. Initially, that action resulted in a jury award against Exxon of $287 million in compensatory damages and $5 billion in punitive damages. The punitive damages award was reduced to $507.5 million after appeals by Exxon. Nearly all of the monies from these awards have been distributed to the plaintiffs.
The Environmental Enforcement Section (EES) lawyers from the Department of Justice’s Environment and Natural Resources Division (ENRD), in partnership with attorneys from other divisions in the Department and the State of Alaska, negotiated with Exxon regarding the natural resource damages attributable to the Spill. The settlement of the claims of the United States and the State of Alaska (the Governments) that was approved by the U.S. District Court for the District of Alaska required Exxon to pay $900 million over ten years, beginning in December of 1991. The expenditure of these settlement monies for restoration of the natural resources and services affected by the Spill has been overseen by three federal and three State natural resource trustee agencies – the U.S. Department of the Interior; the U.S. Department of Agriculture; the National Oceanic and Atmospheric Administration of the Department of Commerce; the Alaska Department of Fish and Game; the Alaska Department of Law; and the Alaska Department of Environmental Conservation. The settlement also contained a “Reopener for Unknown Injury,” pursuant to which the Governments have demanded that Exxon pay an additional $92 million in natural resource damages owing to the continued presence in many Spill area beaches of lingering Exxon Valdez oil.
The Legal Impact of the Spill:
In addition to this huge settlement, the Spill led to important legal and policy changes in which the ENRD played a role. In 1990, with advice from ENRD, Congress passed the Oil Pollution Act (OPA) to strengthen safety requirements for oil tankers in U.S. waters and provide clearer, tougher remedies when oil spills occur. New natural resource damages assessment rules adopted by NOAA under OPA (also with advice and legal support from ENRD) endorsed using the cost of restoration projects as the preferred measure of damages, instead of relying on economic tools to place a value on lost natural resources.