Exxon crimes

[Louis Proyect <lnp3@xxxxxxxxx>]

Betrayed by an oil giant
15 years after the Exxon Valdez disaster, the coast remains polluted and 
compensation is unpaid
By Andrew Gumbel
The Independent, 25 March 2004

Shortly after the Exxon Valdez oil spill in 1989, a senior Exxon 
representative visited the devastated fishing communities of southern 
Alaska and promised them the company would do everything in its power to 
restore their livelihoods and "make them whole".

"We're Exxon, we do it right," is the slogan that has stuck in the mind 
of Dune Lankard, a local Native American activist.

But 15 years to the day since a drunken sea captain drove his oil tanker 
on to a reef in Prince William Sound, covering one of the world's most 
pristine stretches of coastline with at least 11 million gallons of 
crude, the feeling among fishermen, environmentalist activists and the 
lawyers representing them is that Exxon has not only broken its original 
promise but has gone out of its way to betray them in pursuit of broader 
corporate interests.

Exxon, whose net income for 2003 is expected to top $21bn, has not paid 
out a penny of the $5bn (£2.7bn) in damages originally awarded to the 
fishing communities a decade ago, launching appeal after appeal and 
deluging the courts with paperwork. Despite intensive clean-up efforts, 
Prince William Sound remains polluted by large oil deposits that have 
destroyed its herring fisheries and wreaked havoc with the 
once-flourishing wildlife.

The town of Cordova, whose fishermen could once count on earning 
$100,000 a season, has become an outpost of despair, where debt and 
destitution have given rise to alcoholism, drug abuse, broken marriages 
and numerous suicides. About 1,000 of the original 32,000 plaintiffs in 
the class-action suit against Exxon have died, many of them succumbing 
to respiratory illnesses, brain tumours and cancers that a growing body 
of scientific evidence has linked to the spill and the subsequent clean-up.

Of the survivors, many hang on, ever more despondently, for the Exxon 
settlement money to arrive. Others have been forced to sell up and move 
away, returning in the summer months to fish what they can from the 
Snake river as the debt on their boats and their once highly valuable 
fishing permits continues to accumulate.

"Exxon has dodged its responsibility every step of the way," Mr Lankard 
said. "The company had every opportunity to go beyond the call of duty. 
Instead, they've understood that their hand gets stronger the longer 
they wait. And in the meantime, people are dying."

Yesterday, a large delegation of Cordovans and their supporters were in 
Washington to lobby the Bush administration to reopen the federal 
government's own suit against Exxon and force the company to pay out an 
extra $100m in environmental damages. That extra money was written into 
the original 1991 settlement for environmental damages - worth $900m - 
in the event that oil damage proved more extensive than foreseen.

The fear of environmental activists, however, is that both the Bush 
administration and Alaska's leading elected officials would prefer to 
defer to the oil industry and let Exxon off the hook. Alaska's attorney 
general, Craig Tillery, has said it may be "premature" to present a case 
for the extra $100m, which must be claimed by 2006.

Among those in Washington was Kory Blake, a third-generation Cordovan 
known before the spill as a "highliner" because he was one of the most 
productive commercial fishermen pulling herring and salmon out of the 
Sound. He had about $500,000 invested in his boat and in three 
commercial licences when the disaster struck.

At first, he was kept busy with the clean-up, on which Exxon spent an 
initial $2bn. Exxon also voluntarily paid an initial $300m in 
compensation to 11,000 individuals. But then in the early 1990s, just 
when everyone expected to start fishing again, it became clear that the 
herring stocks had not returned and the price of salmon - also slow to 
recover - started to go through the floor as canneries turned to other 
sources in Chile and Norway. Mr Blake had to sell his home to meet the 
annual $50,000 payments on his boat, and moved his family to a suburb of 
Anchorage, where his wife got a job as a school administrator.

Exxon's stonewalling - or what one expert, Steve Picou, professor of 
sociology at the University of South Alabama, calls "adversarial 
legalism" - goes back to the earliest days of the legal battles in 1990, 
when a company lawyer argued that the crude oil was not a pollutant 
under the Clean Water Act since it was a valuable commodity, not a waste 
product. In the class-action suit, Exxon threw up so many obstacles 
after the initial $5bn judgment that the case generated more than 7,700 
docket entries. In a letter written to the company in 1999 by the 
National Association of Attorneys General, the company was accused of 
actually profiting from the delay in payment because of the difference 
between the interest rate being charged by the courts and the much 
higher rate it enjoyed through its own internal financing systems. "Each 
year Exxon delays payment of its obligation," the letter said, "it earns 
an estimated $400m."

In 2001, the Ninth Circuit Court of Appeals overturned the damages 
award, prompting Cordova's mayor to kill himself. The award was largely 
reinstated a year later, but remains tied up in the appeals process for 
the foreseeable future.

Exxon's critics say the government missed several opportunities to 
pressure the company into settling, especially in 1999 when the Federal 
Trade Commission was considering Exxon's proposed merger with Mobil. The 
merger was approved without reference to the Exxon Valdez.

Exxon's attitude is that it has already done its duty. It strongly 
disputes suggestions that the spill involved significantly more than the 
acknowledged 11 million gallons, and has rebutted scientific evidence of 
continuing damage to marine and bird life with its own scientific 
studies demonstrating the opposite. "The environment in Prince William 
Sound is healthy, robust and thriving," a recent company statement said. 
"That's evident to anyone who's been there, and it is also the 
conclusion of many scientists who have done extensive studies of the 
Prince William Sound ecosystem."

Not only do the environmentalists strongly disagree, they see the events 
of the past 15 years as an ominous sign of how corporations will feel 
entitled to behave in future.

"They are making all these promises about treading with a light 
footprint and respecting the environment if they open up the Arctic 
National Wildlife Refuge to oil and gas exploration, yet they refuse to 
settle up on a mess they've already made," Dune Lankard said.

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