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Puerto Rico v. SS Zoe Colocotroni

Citation: 10 ELR 20882
No. Nos. 78-1543, 79-1468, 628 F.2d 652/15 ERC 1675/(1st Cir., 08/12/1980)

The First Circuit Court of Appeals remands a district court ruling awarding damages to Puerto Rico for injuries to its natural resources sustained as a result of an oil spill from appellants' ship. Considering first several procedural issues, the court rules that the district court did not abuse its discretion in striking appellants' pleadings on the question of liability. Appellants' persistent noncooperation with the court and opposing counsel during discovery proceedings justified such a sanction under FED. R. CIV. P. 37(b). Though it was therefore unnecessary for the district court to make findings on the question of liability, the making of such findings did nto prevent it from fairly determining an appropriate damages award. In addition, the court finds that in light of Puerto Rico's expansive long-arm statute, the district court had personal jurisdiction over appellants. Moving to the substantive issues, the court rules that Puerto Rico and its Environmental Quality Board have a valid cause of action to recover damages for injuries to natural resources. Declining to decide whether a state's inherent regulatory power authorizes it to bring suit for injuries to such resources, the court finds that a Puerto Rico statute specifically permits such suits. The court concludes, however, thatt the lower court calculated the amount of the damages in an improper manner. It was correct to reject the diminution-in-value approach proposed by appellants, but it was error to multiply the total number of organisms killed by the spill times the cost of their replacement by biological supply houses. Recent federal legislation dealing with the issue suggests that the proper standard of compensation is the cost reasonably to be incurred by the sovereign to restore or rehabilitate the environment in the affected area to its pre-existing condition, or as close thereto as is feasible without grossly disproportionate expenditures. The case is remanded for reestimation of damages on this basis.

Counsel for Appellants
Owen McGivern, John W. Wall, Peter S. Dealy,
Gary G. Schmidt
Donovan, Leisure, Newton & Irvine
30 Rockefeller Plaza, New York NY 10020
(212) 489-4100

Daniel J. Dougherty, Mary Louise Montgomery
Kirlin, Campbell & Keating
120 Broadway, New York NY 10005
(212) 732-5520

Counsel for Appellees
Nicolas Jimenez, William A. Graffam
Jiminez & Fuste
G.P.O. Box 6104, San Juan PR 00918
(809) 767-1030

Jose A. Quiles, U.S. Attorney
P.O. Box 3391, San Juan PR 00904
(809) 753-4656

Alice Daniel, Ass't Attorney General; William G. Kanter, Allen van Emmerick
Civil Division
Department of Justice, Washington DC 20530
(202) 633-3354

Counsel for Amici Curiae Nat'l Wildlife Federation
Kenneth S. Kamlet
National Wildlife Federation
1416 16th St. NW, Washington DC 20036
(202) 797-6800

Counsel for Amici Curiae Commonwealth of Massachusetts
Francis X. Bellotti, Attorney General; Stephen M. Leonard
One Ashburton Pl., Boston MA 02108
(617) 272-2200

Before Coffin, Campbell and Wyzanski,* JJ.