The Supreme Court issued its verdict in the Exxon Valdez case today. The justices reduced punitive damages from $2.5 billion to $507.5 million. That works out to about $15,000 per plaintiff.
"The punitive damages award against Exxon was excessive as a matter of maritime common law," wrote Justice David Souter in the majority opinion. "In the circumstances of this case, the award should be limited to an amount equal to compensatory damages."This is clearly a big win for ExxonMobil, which has used its financial advantages to delay paying punitive damages for fifteen years while whittling down its size to the point that it is only a tenth of what the jury awarded.
The court was divided five to three.
The 32,677 plaintiffs in the case have been waiting for their compensation since 1994, when a jury in Anchorage returned a $5 billion punitive-damages award against Exxon Mobil Corp. The company has been appealing the verdict since then. In 2006, the 9th U.S. Circuit Court of Appeals cut the award to $2.5 billion. Exxon appealed that decision to the Supreme Court, which heard oral arguments in the case on Feb. 27.
Business groups such as the American Petroleum Institute and the U.S. Chamber of Commerce had hoped that the Supreme Court would use the Exxon Valdez case as a way to curb what they believe are large punitive damages against corporations.
Former Alaska governors, the current governor, the congressional delegation, supertanker captains, environmentalists, state lawmakers, Alaska Natives and experts in maritime law all joined with the 32,677 plaintiffs in asking that the Supreme Court uphold the $2.5 billion verdict.
See also: Exxon Valdez spill by the numbers (via)
Update: Here are reactions from residents of Cordova, Alaska, home port of many of the fishermen affected by the spill.