Court Slashes Exxon Valdez Damages

The U.S. Supreme Court yesterday cut the $2.5 billion punitive damages award in the 1989 Exxon Valdez oil spill to just over $500 million.

The court declared that punitive damages collected from Exxon Mobile Corp. should not exceed the actual damages from the environmental disaster, which were about $507 million.

About 33,000 Alaskans, including commercial fishermen, Native Alaskans, landowners, businesses and local governments, are in line to share in the award. With the new decision they will receive approximately $15,000 a person. They would have collected $75,000 each under the $2.5 billion judgment.

Sens. Lisa Murkowski and Ted Stevens and Rep. Don Young (R-Alaska) were quick to criticize the decision, releasing a joint statement saying:

"We are extremely disappointed that the Supreme Court has chosen to reduce the punitive damages amount from $2.5 billion to $507.5 million. Three times previously, lower courts have ruled on the amount of damages and the Supreme Court, in our opinion, should have allowed the $2.5 billion judgment to stand. Today's ruling adds insult to injury to the fishermen, communities and Alaska natives who have been waiting nearly 20 years for proper compensation following the worst environmental disaster in our nation's history. As a result of today's ruling, we are redoubling efforts to get signed into law the delegation plan to give the 33,000 victims of the 1989 Exxon Valdez oil spill the ability to increase retirement contributions and to provide tax relief through income averaging of the individual settlement amounts."

Overall, Exxon has already paid $3.4 billion in fines, penalties, cleanup costs, claims and other expenses resulting from the spill.

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