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In re Oil Spill by the Oil Rig "Deepwater Horizon"

ELR Citation: 46 ELR 20059
Nos. 2179, (E.D. La., 03/11/2016) (Barbier, J.)

A district court granted an oil company's motion to dismiss claims filed against it for economic losses stemming from the government's moratorium on offshore drilling in the aftermath of the Deepwater Horizon disaster. The oil company is a responsible party under OPA, and the plaintiffs—oilfield service companies that do business in Gulf of Mexico waters—claimed it should be held liable for their economic losses. But the moratorium was not an unavoidable mandatory response to the oil spill. Rather, the moratorium addressed the risk of possible future blowouts and oil spills from other wells and was motivated by the perceived weakness of industrywide safety measures. Although there can be no doubt that the government would not have imposed the moratorium had the Deepwater Horizon disaster not occurred, the plaintiffs' losses did not result from the discharge or substantial threat of discharge of oil following the oil rig blowout and spill; they resulted from the perceived threat of discharge from other wells. The plaintiffs' claims are therefore consequential economic losses caused by the government-imposed moratorium, and such claims are not compensable under OPA because they did not “result from” the discharge of oil, the moratorium was not an OPA “incident,”and the losses were not “due to the injury, destruction, or loss of real property, personal property, or natural resources.”