The reference to state or “maritime” law is a key choice of words in the debate surrounding the claims process…because maritime laws carry much different penalties for BP and other companies than they would face if this disaster had happened on land.
We’ve reported here before on efforts to change the laws (visit www.peoplebeforeprofits.org for background), but it’s worth understanding that maritime law has its own complexities. Having done lawsuits involving both state tort law and maritime rules, I think the cases at sea can be even tougher except that punitive damages may be available under general maritime law for those that qualify, where they are not in Louisiana.
For one thing, the “Limitation of Liability Act,” or LOLA, is an 1851 law that sought to motivate investment in American shipping. Now it’s being used to try and limit liability in this case. It’s why Transocean, shortly after getting a reported $400 million insurance check, turned around and asked a court in Houston to limit liability to $26.7 million.
And the Death on the High Seas Act (DOHSA) limits corporate liability in other ways, mostly by limiting the families to receiving what the deceased might have made over the years. In some cases where somebody doesn’t have direct dependents, liability can in theory be limited to the cost of a funeral.
To keep things more complex, there’s also the somewhat conflicting Jones Act, a sort of workers compensation for those who qualify as “seamen.” It allows for some liability, but nothing close to what a family would receive if this had happened on American soil.
And if all that seems a bit cold…despite recent efforts to give corporations all the rights of actual people, they are legally organizations. While criminal charges are being investigated, the only punishment for BP and the others is largely financial at the moment. I know a lot of people down in New Orleans who’d like to some folks go to jail.
No doubt the entire industry is watching for lessons to be learned. If BP can be held responsible for a disaster of this magnitude…and walk away with relatively light payments, then others will make future decisions accordingly. Make no mistake, that’s the way industry works…risk versus reward. Cutting corners will be a risk more are willing to take. More and bigger risks. Open season on the high seas.
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