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June 1st, 2016
environmental
UNITED STATES SUPREME COURT REFUSES TO HEAR EXXON’S PETITION FOR WRIT OF CERTIORARI BASED UPON ALLEGED DUE PROCESS VIOLATIONS

In May 2016, the U.S. Supreme Court denied Exxon’s petition for writ of certiorari seeking review of a $236 million trial judgment against it in a groundwater contamination case in New Hampshire.  The Court’s refusal to review the issues raised by Exxon leaves in place a verdict Exxon claims violates its due process rights.  

 

 

 

 

 

 

 

In its petition, Exxon contends the New Hampshire Supreme Court violated due process when it affirmed the jury’s decision that the company should pay $236 million to clean up contamination caused by the gasoline additive methyl tertiary butyl ether (MTBE).  Exxon Mobil Corporation, et al. v. State of New Hampshire, No.15-933, U.S., document #15-160216-001C.

 

New Hampshire sued 16 oil companies over the additive in 2003, claiming they knew it would contaminate water supplies and be difficult to clean up, but ignored those risks. The state settled with 15 of the defendants for a total of $136 million in consideration. Only Exxon went to trial.

After a three-month trial, a state jury found Exxon liable for pollution linked to the additive and awarded the state $236 million for testing and cleanup costs. On appeal, Exxon argued the case should have been dismissed at the outset, because remediation for gas spills was dealt with exclusively by state-mandated funds.

 

Around $195 million of the judgment set aside for future cleanups was placed in trust, but the New Hampshire Supreme Court reversed that ruling on October 2, 2015, ordering the funds released to the state.

 

The state Supreme Court held the laws creating cleanup funds did not preclude the state from seeking damages. The Court also rejected Exxon's argument that the trial court had deviated from precedent set by other courts considering MTBE cases by allowing statistical evidence of the contamination.

 

Exxon argued the Supreme Court should grant certiorari and hear the case because it was held liable in a “trial by formula” based on aggregate, statewide proof, which violated its right to due process.   Exxon also claimed its use of MTBE was the only feasible way to comply with New Hampshire's program to oxygenate gasoline in order to reduce air pollution as mandated by the Clean Air Act. In its petition, Exxon argued a state tort law penalty cannot be imposed for complying with a federal mandate.

 

 

New Hampshire argued Exxon had waived its arguments that its federal due process rights were violated through the use of statistics to extrapolate the company's share of liability for MTBE contamination. New Hampshire also challenged Exxon's claim that its use of MTBE was the only feasible way to comply with the state's Clean Air Act-mandated program to oxygenate gasoline, saying federal courts have consistently held that the law does not preempt state actions imposing liability for manufacturers' decisions to use MTBE.

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