• United States Files Motion to Lift Stay in Transocean Limitation of Liability Proceeding
  • June 15, 2010
  • Law Firm: Balch Bingham LLP - Birmingham Office
  • Specifically, the United States requested that the court lift or modify its injunction to clarify that, with respect to the Deepwater Horizon incident, the Limitation of Liability Act and Rule F “shall neither apply to nor affect the following claims, actions, causes of action, or proceedings”:

    (1) any claims brought under the Oil Pollution Act of 1990, whether direct or indirect;

    (2) any claims brought by the federal, state or municipal governments or any other civil and administrative penalties;

    (3) any claims brought pursuant to the Park System Resource Protection Act, the National Marine Sanctuaries Act, the Clean Water Act, the Rivers and Harbors Act, and the Comprehensive Environmental Response, Compensation, and Liability Act.

    The United States’ memorandum accuses Transocean of failing to advise the court that the Limitation of Liability Act may not enjoin environmental claims brought by the U.S. government, states, or by private citizens under federal and state environmental laws.  In addition, the United States cites to United States v. CF Industries, Inc., 542 F. Supp. 952, 956-57 (D. Minn. 1982), to show that Transocean’s attempt to extend the liability limitation to OPA claims is contrary to established law.  In this case, defendant filed a petition under the Limitation Act, and, in response, the United States instituted an independent proceeding in which it asserted a civil penalty claim under the Clean Water Act (CWA).  The limitation petitioner argued that the United States had improperly filed suit in a separate proceeding from the limitation action, and that the injunction issued by the limitation court applied to all proceedings, including the United States’ civil penalty claim.  The court held, however, that because the civil penalty assessment under the CWA was not subject to limitation under the Limitation Act, the limitation court had no jurisdiction whatsoever over the United States’ civil penalty claim.  Because the court lacked jurisdiction, the injunction was meaningless.  The United States notes however, that in this case, out of respect for the Court, it has filed this motion rather than proceeding independently as in CF Industries.