State coastal chief assails lawsuit against oil, gas industry


Associated Press

NEW ORLEANS — A south Louisiana flood prevention board’s lawsuit against oil and gas companies is an assault on a vital job-producing industry and throws a monkey wrench into a coordinated state effort to save and restore Louisiana’s eroding coast, the state’s top coastal official told a legislative panel Wednesday.

“I’m not saying anyone deserves a pass,” Garret Graves said during a joint meeting of the House and Senate transportation committees in Baton Rouge. But, he questioned the legality of the lawsuit filed by the Southeast Louisiana Flood Protection Authority-East against 97 oil, gas and pipeline companies.

He also said oil and gas companies have provided land rights and donated money and in-kind services to coastal restoration efforts. “That relationship has just frozen,” Graves said. “And projects that were actually underway now are going to be impeded because of this lawsuit.”

He called the unprecedented suit a “stovepipe” approach that focuses on just one of many causes of coastal erosion, among them levee projects by the U.S. Army Corps of Engineers that have cut off sediment rich river flows to the coast.

Backers of the lawsuit said the industry has done much for the state but hasn’t been held sufficiently accountable for the damage done by dredging for canals and pipelines that have contributed greatly to the loss of wetlands that serve as a natural buffer against hurricane storm surge.

Stephen Estopinal, treasurer of the flood protection authority, likened the oil companies to free-spending rock stars who provided a boost to a local economy when they arrive for a concert.

“The businessmen make money. The people who sell things make money. The rock band makes millions of dollars, but before they leave they trash the hotel room,” Estopinal said during the meeting, held in a state Capitol committee room and carried live on the Internet. “I think the guy that owns the hotel room ought to have the rock band pay to fix it up.”

Gov. Bobby Jindal and Graves assailed the lawsuit as a boon to trial lawyers as soon as it was filed last month. The suit had a sympathetic ear from some at Wednesday’s hearing but most lawmakers who spoke were either skeptical or openly hostile to the lawsuit.

“Your job as a levee authority is not to hustle money,” Rep. Christopher Leopold, R-Belle Chasse, told flood authority members.

Some lawmakers were especially unhappy with the “poison pill” nature of the lawsuit. As spelled out in the committee, attorney Gladstone Jones and his associates took the suit on a contingency basis. If they lose they get nothing. If they win they could take a hefty percentage of damages that, according to speculation at the hearing, could total $10 billion.

But, if the lawsuit is withdrawn, the attorneys have to be paid by the taxpayer-supported flood authority for work done — a tab estimated at $300,000 and growing as of Wednesday’s meeting.

Flood authority vice president John Barry called it a fair arrangement, protecting the interests of a law firm that is spending huge amounts of time and money at the risk of losing the suit — and creating a disincentive for withdrawing the lawsuit under political pressure.

At times, Wednesday’s hearing sounded like a preview for what a trial might look like should the lawsuit proceed to the courtroom, with testimony touching at times on what type of restoration could, or should, be required of companies.

Graves and Sen. Robert Adley, R-Benton, acknowledged that oil and gas activity has a part in wetlands loss but said permitting and requirements have been tightened over the years to address that. Holding the industry accountable for decades of activity the state invited and permitted would be wrong, said Adley.

Graves said the SLFPAE’s decision to file a lawsuit — later officially opposed by all other members of the Association of Levee Boards of Louisiana — was made “in a vacuum.” He disputed as “complete fiction” the authority’s contentions that he never objected to the suit when told about it before it was filed.

No votes were taken at the hearing. It was a fact-finding meeting, Adley said, in preparation for steps the Legislature might take to address the lawsuit.

The SLFPAE board of commissioners filed the suit in Orleans Parish Civil District Court on July 24. It was transferred to federal court Tuesday at the request of defendant Chevron U.S.A Inc., but that move may be temporary.

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