BP, Deepwater Contractors Push Back

By Margie Burns

The explosion of British Petroleum’s Deepwater Horizon oil rig in the Gulf of Mexico, killing 11 workers and threatening the future of the Gulf Coast, has not chastened the corporate world into refraining from push-back.

BP is being sued by a number of groups, including its own shareholders, both in the US and around the world, and the company is lawyering up as well as continuing to lobby against any future increase in liability. So are BP allies, including fellow future defendants Transocean, which owns the Deepwater Horizon oil rig, and Halliburton, which poured the faulty cement implicated in the explosion. The three companies, which openly pointed fingers at each other in congressional hearings, are paying millions to gear up for their fight against the public.

So is the Chamber of Commerce, which has touted an unprecedented war chest for the 2010 fall elections, to oppose candidates it does not want. The Chamber has been pushing hard for months, so far unsuccessfully, against John “Jack” McConnell, a plaintiff’s attorney who made his living by suing corporations, to prevent McConnell’s being confirmed for the federal district court in Rhode Island. Nothing like being prepared: After all, the oil slick from Deepwater Horizon may eventually work its way up the East Coast. Not just the Gulf Coast, but every eastern shoreline in North America, and every sea bed near the shorelines, may ultimately be affected.

While it is the trial lawyers who make the news, law firms that do environmental defense work are quietly hiring bigtime, right now. Northern Virginia firm McGuireWoods, for example, a Republican-connected law firm in the Washington , D.C., suburbs, recently picked up a former aide to GOP Sen. Richard Burr of North Carolina.

Like BP, Transocean has also been lawyering up, while lobbying intensively to prevent legislation that could increase its civil liability. Since May 13, Transocean has been trying in federal court to cut its future losses from the BP oil spill down to $27 million. Transocean, which owns the oil rig that exploded in the Gulf of Mexico, filed a motion in federal court in the Southern District of Texas, invoking an 1851 maritime law. As reported by the National Law Journal, “Citing an 1851 law aimed at shipping mishaps, Transocean said its damages should be limited to $26.7 million in unpaid drilling fees earned before the April 20 explosion, noting the Deepwater Horizon rig is otherwise worth nothing now.

“The Limitation of Liability Act of 1851 states that the owner of a ship — or, in this case, offshore oil rig — is only liable for the value of the ship post-accident. This is the same law the owners of the Titanic used to limit their liability.”

Nothing like following the example set by the Titanic.

Halliburton, former Vice President Dick Cheney’s old company, is also lobbying, politicking and hiring, and had to file amended disclosure reports June 4. Halliburton had reported less than half the actual amount it spent on lobbyists in 2010 — $50,000 in the first quarter as opposed to the actual $120,000. The amended reports for the past 15 months correct the discrepancies. The company’s lobbying expenditures include $320,000 paid to Jackson Lewis, the law firm known informally as the worst of the worst of union-busting (euphemized as “workplace law”) firms.

Halliburton has now hired D.C. law and lobbying firm Patton Boggs. At this writing, Patton Boggs, regarded as a D.C. lobbying powerhouse, is announcing its acquisition of another lobbying firm. In a move that will probably heighten cynicism about both major parties ahead of the fall elections, former senators John Breaux (D-La.) and Trent Lott (R-Miss.), who joined to form lobbying firm Breaux Lott after leaving office, finalized the deal to sell their firm to Patton Boggs July 1. The negotiation talks, reportedly ongoing for months, presumably picked up speed in the wake of the Deepwater Horizon oil rig disaster.

The companies that caused the BP disaster in the Gulf of Mexico are going to need all the help they can get. Along with the loss of life, ever expanding areas of the Gulf are off limits to fishing — the only livelihood for many small communities along the coast. Travel and tourism to what is called the Third Coast has already been affected; the Washington Post has reported that East Coast beach towns are feeling the positive blowback, for now, of increased revenue from tourists who would typically have gone south.

Entire pods of dolphins have been sighted dead and dying, viewed on cable television network MSNBC, in the toxic haze caused by burning oil in the Gulf. Sea turtles are reportedly being killed as well in what BP calls controlled burns. The Miami Herald reported July 1 that a Louisiana fishing captain, Mike Ellis, hired to rescue sea turtles, said in an interview posted on the Internet that the boats hired by BP were corraling oil in fire-proof booms and igniting it before surveying for the turtles. Through June 28, the Herald reports, the US Fish and Wildlife Service had recovered 436 dead sea turtles from the coastline and four on the water.

There has been action on the BP blowout on the governmental and legal front. The Senate voted June 16 to eliminate the federal tax deduction for companies paying punitive damages — a move previously called for by President Obama. Rep. Henry Waxman (D-Calif.) introduced legislation June 29 named “Blowout Prevention Act of 2010,” “To protect public health and safety and the environment by requiring the use of safe well control technologies and practices for the drilling of high-risk oil and gas wells in the United States, and for other purposes.” The bill would require demonstrated ability to prevent and contain leaks before drilling; would institute blowout preventer requirements; would require regulations ensuring safe wells and cementing; and would require well control and blowout prevention inspectors.

Reps. Waxman, Ed Markey (D-Mass.) and Bart Stupak (D-Mich.) also wrote letters June 28 to the CEOs of the ExxonMobil, ConocoPhillips, Shell, and Chevron oil companies, requesting information on the companies’ oil spill response plans. In their letters to Rex Tillerson of ExxonMobil, Marvin Odum of Shell, John Watson of Chevron, and James Mulva of ConocoPhillips, the congressmen point out that “No oil company appears to be better prepared for a disastrous oil spill than BP was.”

Conversely, the GOP and Fox News Channel have been campaigning indirectly to get BP, Transocean and Halliburton off the hook and to get the taxpayers on the hook, for the costs of the oil gusher.

Margie Burns is a Texas native who now writes from Washington, D.C. Email margie.burns@verizon.net. See her blog at www.margieburns.com.

From The Progressive Populist, August 1, 2010