"You are so lucky. You have got Exxon. We take care of our problems." - Exxon public relations spokesman shortly after the Valdez spill.
Within weeks of the Valdez spill, Exxon set up a "claims program" to provide fishermen and others with relief payments. Exxon hired many local fisherman and residents to assist in spill clean-up, and spent $3.5 billion in clean-up costs without government coercion. Then, nothing. Those damaged by the spill were forced to file lawsuits which stretched for years.
Exxon's handling of the Valdez disaster was a driving force behind Congress' adoption of the Oil Pollution Act of 1990, an act with many positives and a few potentially horrific negatives. One real potential pitfall of the Act is the $75 million liability cap it imposes on the party deemed legally responsible for the spill. The cap can be set aside if the responsible party is found to be grossly negligent, reckless or in violation of a federal regulation.
Will BP engage in years of obstructionism and legal argument over the cap's applicability in hopes of hanging on to the billions of damages likely caused by the spill? Or, will BP choose pay the damages it has caused without all that fighting?
In this AP news story, (http://news.yahoo.com/s/ap/20100504/ap_on_go_pr_wh/us_gulf_oil_spill_liability/print), BP's CEO Tony Hayward makes this commitment with regard to the company's intention to enforce the $75 million cap: "It's got nothing to do with the caps. All legitimate claims ... will be honored." BP has explained on its website that it will honor "legitimate and objectively verifiable claims for ... loss and damage caused by the spill."
Maybe BP will attempt to enforce the cap. Maybe it won't. This much is certain: A whole lot of interest can be earned on several billions dollars during the years lawyers duke it out over legal issues. Color me cynical.