BATON ROUGE – More than a year after the release of a paper describing the many lawsuits against the energy industry by a "handful of powerful plaintiffs' firms" over coastal erosion, two experts in the field say that so far the winners are the attorneys and political cronies.
"These unfounded lawsuits generate exorbitant fees for these attorneys and large plaintiff awards, driving up the cost of doing business in the Pelican State," Louisiana Lawsuit Abuse Watch Executive Director Lana Sonnier Venable told the Louisiana Record. "Subsequently, businesses often must pass these costs on to their customers in order to survive. The bottom line is that Louisiana taxpayers wind up paying the cost of litigation through higher prices for goods and services."
Meanwhile, attorneys in the cases and some of Democrat Gov. John Bel Edwards' political supporters look to be sitting pretty, Venable said.
Louisiana Lawsuit Abuse Watch Executive Director Lana Sonnier Venable
| Photo courtesy of Louisiana Lawsuit Abuse Watch
"If successful, these attorneys stand to gain millions," she said. "There is additional interest due to the involvement of Gov. Edwards and his leading campaign fundraisers hired to represent the state in these suits. The governor has also encouraged other parishes to file additional lawsuits but thus far, none have signed on.
"This is another example of bypassing the administrative process established by the state to address alleged permit violations and other regulatory issues, clogging our courts with issues that should be addressed through the legislative process. Policymaking that occurs in the courtroom and outside the Capitol sends the wrong message about our state."
The money is just too good for plaintiffs' attorneys to ignore, Louisiana Oil & Gas Association President Gifford Briggs said during a separate Louisiana Record interview.
"Billions and billions of dollars," he said. "The plaintiffs have a 16-point compensation schedule, that basically ends up with them [the attorneys] having a 30 percent contingency fee. It's not that hard to see why they are so interested in the litigation."
That isn't good for Louisiana, Briggs said.
"It is frivolous lawsuits like these that are contributing to Louisiana being deemed one of the top litigious hellholes in the nation," he said. "Trial lawyer and bogus lawsuits are costing future jobs for working families and tax revenue that is vital to the function of our local communities and the state. The oil and gas industry should be celebrated and not attacked for it successes and contributions to Louisiana."
Venable and Briggs' comments come more than a year after release of a legal industry paper detailing litigation against energy producers in Louisiana's coast zone.
Laura S. Brown, an energy and environmental litigation attorney in Liskow & Lewis' New Orleans office, and Chevron Senior Counsel Jennifer Ferratt released their paper, "Coastal Erosion Litigation in Louisiana" during the Institute for Energy Law's First National Young Energy Professionals' Law Conference in New Orleans last spring.
In that paper, Brown and Ferratt described the vital importance of Louisiana's coastal zone, the devastation wrought by hurricanes such as Katrina, Rita and Gustav and observed for several years prior "handful of powerful plaintiffs' firms have initiated a wave of complex litigation against the energy industry."
Those firms had by then filed dozens of lawsuits against hundreds of oil and gas and pipeline companies, according to the report.
"These lawsuits arguably represent the biggest threat to ongoing efforts by those with a genuine interest in coastal sustainability," the report said.
"The first of these types of suits filed by the Southeast LA Flood Protection Authority-East in 2013 were repeatedly rejected by Louisiana courts and eventually thrown out by the U.S. Supreme Court," Venable said. "These unfounded lawsuits wasted valuable time and money that could have been much better spent on restoring Louisiana’s critical coast."
That hasn't stopped litigation in the parishes, Venable said.
"Lawsuits like the current parish suits, led by a handful of politically powerful, well-connected plaintiffs' lawyers and environmentalists, breed unpredictability for business, hurt our economy and cement Louisiana’s reputation as one of the worst states to be sued in the U.S.," she said. "These lawsuits assert a wide variety of legal theories apparently intended to keep the cases in state courts perceived to be friendlier to the plaintiffs.
"Earlier this year, the suits were returned to federal court, based on industry’s argument that the alleged activities were conducted decades prior to 1980, before the Louisiana State and Local Coastal Resources Management Act. Development activities were governed only by federal regulation and complied with all laws in place at the time."
Those lawsuits aren't going to stop, Briggs said.
"The lawyers are going to continue to file as many suits as they possibly can in as many parishes as they can," he said. "They have picked five cases in Plaquemines to move forward with first. I'm sure they are the cases they feel the best about."
A handful of cases are scheduled for trial in March but await final jurisdiction before further action can be taken, Venable said.
"These cases are expected to set the stage for what happens next with the multitude of others filed by coastal parishes against the oil and gas companies," she said.
Depending on that outcome, it could open a floodgate to Louisiana coastal litigation against energy companies that would make the present group of cases look like a trickle, Venable said.
"Based on the outcome of these initial suits, countless others could be filed, impacting continued growth in the state's oil and gas sector," she said. "Louisiana taxpayers should be concerned. Not only does the energy industry provide jobs for generations of families, it also puts millions in taxes into state coffers and generates millions in royalties that factor prominently into our state budget. The importance of this is no more evident than in this year’s three special sessions intended to keep Louisiana from falling off yet another fiscal cliff."