A federal judge last week granted a Texas-based oil company’s request to seek punitive damages in litigation against the owners and managers of a tanker ship that struck the company’s oil platform located off of Louisiana’s coastline.
Judge Donna Phillips Currault of the Eastern District of Louisiana approved Cox Operating LLC’s request to file the amended complaint against the managers of the foreign-owned tanker Atina. The filing comes in the wake of a National Transportation Safety Board (NTSB) report published in November that found the ship captain’s lack of sleep was largely to blame for the accident that caused tens of millions of dollars in damage.
“This ruling effectively doubles Cox's compensatory repair claim from about $150 million to $300 million (not including loss of production, etc., as that’s not allowed in the punitive equation),” Edward Poitevent II, an attorney for the Louisiana Oil & Gas Association, told the Louisiana Record in an email. “The judge took one day to decide.”
The petitioners opposing Cox’s amended claim contended it should be rejected because it failed to allege the actions of the Atina’s crew were sufficient to warrant punitive damages. They also argued that the incident in the Gulf was “simply a garden-variety negligence situation that does not rise to the level of reckless conduct or callous disregard for the rights of others, or the civil equivalent of a crime,” according to the petitioners’ court filings.
But Phillips Currault disagreed with that position in her Jan. 19 opinion.
“When a party intentionally makes a dangerous decision that is motivated by profit reasons, that conduct suffices to move the case past simple negligence to the type of willful, wanton or reckless conduct necessary to support a punitive damages claim under general maritime law,” she said.
The probable cause of the tanker striking oil and gas platform SP-57B was Atina’s operating company failing to ensure that there was sufficient time to transition from one tanker master to another, according to the NTSB report. This led to the new master’s acute fatigue since he had had no sleep for more than two days while he traveled from his home in Turkey to join the ship, the report said.
“The NTSB report confirmed what everyone knew,” Poitevent said. “The Atina captain hadn't slept for 50 hours before he hit Cox's platform near the mouth of the Mississippi River. If that's not ‘egregious,’ then nothing is.”
The estimated cost of the platform damage is $72.9 million, while the Atina sustained nearly $600,000 damage as a result of the crash, the report said.