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Sweet Lake Land & Oil Co. v. ExxonMobil Corp.

ELR Citation: 41 ELR 20316
Nos. 2:09 CV 1100, (W.D. La., 09/29/2011) (Kay, M.J.)

A district court held that an oil company cannot be held liable for punitive damages in a property owner's case against it for soil and groundwater contamination. The company operated oil and gas wells on the property, and it stored hazardous and toxic materials produced from the wells in an unlined pit. A state statute that was enacted in 1984 and repealed in 1993 allowed plaintiffs to collect punitive damages if their injuries were caused by a defendant's wanton or reckless disregard for public safety in the storage and handling of hazardous substances. Here, the company stopped operating all but one of its wells in 1977 and did not begin operating the remaining well until after 2006. In addition, the company ceased using the pit in 1973, and the pit was closed in 1989. Because the property owner failed to present evidence that the company conducted oil or gas operations on the property while the statute was in effect, it is not entitled to punitive damages. The court rejected the owner's argument that the company's placement of hazardous and toxic substances in the pit was a continuous tort until the pit was closed in 1989. Prior case law provides that the tort terminated when the company stopped disposing of materials into the pit in 1973. The company's failure to close the pit, therefore, is not a continuing tort. The court therefore granted the company's motion for summary judgment on the issue of punitive damages.