BP: Beyond Prosecution (Mother Jones)

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http://motherjones.com/environment/2010/06/bp-chamber-commerce-louisiana

BP: Beyond Prosecution


How the oil industry and Chamber of Commerce convinced La. lawmakers to go easy on BP.

— By Josh Harkinson



Wed Jun. 30, 2010 3:00 AM PDT

On May 1, less than two weeks after the Deepwater Horizon rig exploded, Louisiana Attorney General Buddy Caldwell announced that he would "ensure that BP and other liable parties take full financial responsibility" for the unfolding disaster. Yet even as Caldwell prepares to go after the oil company for billions in damages, his hands are tied. He says the case could cost as much as $100 million over several years. That's money his state, which is facing a $320 million budget deficit, not to mention the economic imact of the spill, just doesn't have.

As any lawyer who advertises on late-night TV could tell you, there's an easy solution to that problem. Forty-eight states allow their attorneys general to hire private attorneys on a contingency basis. In other words, if outside lawyers help the state win a big civil case, they get a cut of the cash. This tactic can be a win-win for states, particularly when deployed against well-funded adversaries, since it comes with few financial risks and the potential for big rewards. In the 1990s, private attorneys suing tobacco companies on contingency won billions of dollars on behalf of state governments (while pocketing as much as a quarter of the settlements).

But that approach is a non-starter in Louisiana, one of two states that bar their AGs from pursuing contingency lawsuits. (The other is Wisconsin.) Just last week, an effort to greenlight a contingency case against BP failed in the state legislature. So did a proposal to tax the company and another that would have allowed Louisianans to sue it for punitive damages. These bills' deaths underscores just how much influence the oil and gas industry wields in the state even as it faces the worst environmetal disaster in its history. The contingency bill's demise "is devastating for the state of Louisiana," writes Attorney General Caldwell in an email to Mother Jones. He adds that he'll still prosecute BP as best he can. "We will continue to fight for the state even if all we have is a slingshot and a stone."

The contingency bill was introduced on the same day that the Deepwater Horizon's well blew out. After it passed the state senate in early June, it was condemned by the Louisiana Oil and Gas Association, the US Chamber of Commerce, and its local affiliate, the Louisiana Association of Business and Industry—all of which count BP as a member. In a joint email, the Chamber and LABI write that they oppose contingency lawsuits "that can be used as fishing expeditions and harassment tools against business and industry."

In response to such concerns, Louisiana legislators amended the bill to limit its scope to the the Deepwater Horizon case. They also exlcluded damages to natural resources and capped attorneys fees at $100 million. But the oil and business lobbies wanted an even lower cap, says Senate president Joel Chaisson, a Democrat who represents an area west of New Orleans. According to him, their lobbyists worked with House speaker Jim Tucker and state Rep. Tim Burns, both Republicans, to stall the bill until the legislature adjourned for the summer last week, effectively killing it. Burns says he'd accepted the $100 million cap but wanted more time to make sure the bill prevented conflicts of interest in how private attorneys would be hired. Tucker did not return a request for comment. "Those lobbyists played far too great a role in this process," says Chaisson, who blames them for blocking "the most important bill of the session."

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