Water Log 30:2

WATER LOGVolume 30, Number 2 July 2010A Legal Reporter of the Mississippi-Alabama Sea Grant Consortium

Special Oil Spill IssueFederal Judge Blocks Moratorium

Streamlining Oil Litigation in Court

A Look at Possible Criminal Charges Arisingfrom the Gulf Oil Spill

2 • JULY 2010 • WATER LOG 30:2

WATER LOG

Welcome to the redesigned Water Log! Wehope you enjoy the new look and welcomeyour comments, negative as well as positive.We would also like to introduce our two sum-mer law clerks, both from the University ofMississippi School of Law. LindseyEtheridge, a 3L, and April Hendricks, a 2L, areworking with the Mississippi-Alabama SeaGrant Legal Program this summer, providingresearch and contributing to Water Log.

This special edition of Water Log focuses onlegal issues surrounding the DeepwaterHorizon oil spill. Articles in this editionaddress the impact of multidistrict litigation onoil spill lawsuits, legal maneuvering surround-ing the drilling moratorium, vessel of opportu-nity contracts, and possible criminal chargesarising from the oil spill.

We also look at the implications of an unusualFifth Circuit decision, Comer v. Murphy Oil,on future oil spill litigation. In Florida, a courtdecision favoring commercial fishermen pro-vides a new means of recovery for pollution tomarine life. Lastly, we provide an overview ofthe U.S. Supreme Court’s decision in Stop theBeach Renourishment.

Thank you for reading Water Log. We hopeyou enjoy this special edition.

Niki Pace

Inside This Issue . . .Federal Judge Blocks Moratorium on

Deepwater Drilling............................................. 3

Streamlining Oil Spill Litigation in Federal Court. .................................................... 5

Federal Court Invalidates One-Sided Vessel Charter Agreement ............................................ 7

Florida Fishermen May Receive Damages from Pollutant Spill...........................................9

A Look at Possible Criminal Charges Arising from the Gulf Oil Spill .....................12

Fifth Circuit Dismisses Climate Change Lawsuit .............................................................. 14

U. S. Supreme Court Finds No Taking inFlorida Beach Renourishment Challenge ....16

Interesting Items ............................................... 19

BP Oil Spill Lecture SeriesTulane Law School

Beginning August 27, 2010, New Orleans, LA(contact editor for more information)

The ABA Section of Environment, Energy, and ResourcesLaw Fall Meeting

http://www.abanet.org/environ/fallmeet/September 29-October 2, 2010, New Orleans, LA

Clean Gulf Oil Spill Training Eventhttp://www.cleangulf.org/

October 19-20, 2010, Tampa, FL

• E V E N T S •

From the Editor’s Desk

Cover photograph courtesy of the U.S. Navy,photographer Mass Communication Specialist2nd Justin E.Stumberg/Released.

JULY 2010 • WATER LOG 30:2 • 3

April Hendricks, 2012 J.D. Candidate, Univ. ofMississippi School of Law

In the wake of the Deepwater Horizon explosion, the fed-eral government ordered an evaluation of the safety of deep-water drilling operations in the Gulf of Mexico. In order toimprove the safety of such operations and provide moresubstantial environmental protection, the Department ofthe Interior (DOI) and the Minerals Management Service(MMS) issued a six-month moratorium on deepwaterdrilling in the Gulf. A federal district court in Louisiana hassince set aside the moratorium, noting that the suspensionof deepwater drilling demonstrated the federal govern-ment’s arbitrary exercise of authority. The U.S. Court ofAppeals for the Fifth Circuit later rejected the federal gov-ernment’s request to stay the lower court’s ruling pendingthe full appeal of the decision.

BackgroundTo evaluate safety measures for offshore drilling rigs, a one-month drilling moratorium was established on May 6,2010; however, on May 27, President Obama extended themoratorium by six months, concurring with Secretary ofthe Interior Kenneth Salazar’s determination that a longermoratorium was necessary to ensure safe drilling proceduresin the Gulf of Mexico. In extending the moratorium, DOIcharacterized offshore deepwater drilling as “an unaccept-able threat of serious and irreparable harm to wildlife andthe marine, coastal, and human environment.”1 MMS’sorder imposing the moratorium defined deepwater drillingas any operation occurring at depths greater than 500 feet.This moratorium ordered 33 existing drilling rigs to ceaseoperation and prohibited MMS from granting additionaldeepwater drilling permits.2

Hornbeck Offshore Services filed suit to challenge themoratorium, alleging that the federal suspension of deep-water drilling threatened its continued ability to providevessel support to the offshore exploration and deepwaterdrilling industries. In June, a federal district court agreedwith Hornbeck’s argument and blocked the moratorium,holding that the suspension of all deepwater drilling in the

Gulf was arbitrary and capricious and, moreover, had a neg-ative impact on both the plaintiffs and the local economiesdependant on the oil and gas industry.3

District Court RulingThough the federal government may have the authority toimpose a drilling moratorium in the Gulf, the court notedthat such an order may not be arbitrarily handed down with-out valid explanations as to its breadth. The OuterContinental Shelf Lands Act (OCSLA) grants DOI theauthority to temporarily suspend any activity that poses “athreat of serious, irreparable, or immediate harm or damage tolife (including fish and other aquatic life), to property, to anymineral deposits (in areas leased or not leased), or to themarine, coastal, or human environment.”4 In finding forHornbeck, the court noted that, under the AdministrativeProcedure Act, DOI’s decision to impose the moratoriumunder the OCSLA could not be set aside unless this decisionwas “arbitrary, capricious, [or] an abuse of discretion.”5

Because DOI failed to clearly explain the reasoning behindissuing such an expansive drilling suspension, the court foundthat no clear relationship existed between the proposed threatsof injury and the “immense scope of the moratorium.”6

The court noted that DOI’s report regarding increasedsafety measures in the Gulf offered valuable recommenda-tions for offshore drilling; however, because DOI failed toaddress the actual danger posed by the 33 operating rigsaffected by the moratorium, the court found that the mora-torium arbitrarily suspended a vast amount of drilling.Moreover, the court took issue with the lack of coordina-tion between DOI and MMS in actually defining thebreadth of the moratorium. DOI’s report never explicitlydefined “deepwater” drilling, noting only that drilling atdepths greater than 1,000 feet presents dangers not experi-enced in shallow waters; however, MMS’s Notice to Lesseesspecifically suspended drilling at any depth greater than 500feet, with no explanation as to why drilling at this depthpresents greater risks to the coastal environment than indeeper waters. In an attempt to explain its rationale for rec-ommending the moratorium, DOI described various stud-ies which noted faulty equipment used on the offshore rigs;

F E D E R A L J U D G E B L O C K SM O R AT O R I U M

O N D E E P WAT E R D R I L L I N G


however, the court dismissed this argument as irrational,characterizing the government’s decision to impose amoratorium based on the failure of a single rig as “heavy-handed, and rather overbearing.”7

The court also noted that Hornbeck and similarcompanies stand to lose contracts and business oppor-tunities if drilling is restricted in the Gulf. ThoughDOI claims the moratorium will have only a minorimpact on these businesses, the court maintained thatthe moratorium will cause oil companies to move theirrigs outside of the Gulf, ultimately leading to lost jobsand business failures which will negatively impact theentire coastal region.8 Though DOI’s report substan-tially supports implementing new regulations to governoffshore drilling, the court held that a blanket morato-rium, based on the failure of a single deepwater rig, isnot warranted and unnecessarily punishes the otherdrilling companies operating in the Gulf withoutregard for their safety records.9

DOI’s ResponseIn response to the lower court’s decision to end themoratorium, DOI appealed to the Fifth Circuit, request-ing that the court enforce the deepwater drilling suspen-sion. Because the court will not hear DOI’s full appeal ofthe lower court’s decision until August 30th, DOIrequested that the Fifth Circuit stay the lower court’sinjunction lifting the moratorium pending the resolu-tion of the appeal. In making this request, DOI notedthat the suspension did not arbitrarily target certain rigsand emphasized that the affected rigs posed similarthreats as the Deepwater Horizon. DOI claimed that,because each of the 33 rigs affected by the suspensionused similar technology and techniques as theDeepwater Horizon, suspending their operations waskey to preventing further damage to the Gulf in theevent of another explosion.10 Though the possibility ofanother blowout is unlikely, DOI contended that thepotential for further damage necessitated the temporarysuspension to provide time to implement new safetymeasures.

While acknowledging that economic impacts to thedrilling industry are a valid short-term concern, DOIfurther asserted that its priority is ensuring the long-termsecurity of the nation’s coastal economy and marineenvironment. During the moratorium, DOI intended toassess the safety protocols for drilling in the Gulf andimplement new safety regulations if necessary.Accordingly, DOI maintained that enforcing the mora-torium was essential to promote the “Gulf ’s economic,

social, and ecological health” by ensuring that no furtherspills occur.11

On July 8th, the Fifth Circuit Court of Appeals, ina 2-1 decision, denied the federal government’s requestto temporarily stay the lower court’s decision while theappeal is pending. To qualify for a stay, DOI needed toestablish that irreparable injury would occur if the staywere not granted. Noting that DOI failed to showirreparable injury was likely, the court refused to restorethe ban on deepwater drilling in the Gulf. Specifically,the court found that DOI failed to show that drillingactivities would resume while the appeal was pending;however, DOI may seek emergency relief from the courtshould drilling commence.12

ConclusionAlthough the Fifth Circuit denied DOI’s motion for astay, the appeal remains on an expedited track; the FifthCircuit is scheduled to hear the matter the week ofAugust 30th. On July 12, DOI issued a second morato-rium on deepwater drilling based on growing evidencethat the oil industry cannot properly respond to andcontain a deepwater blowout.13 Unlike the drilling sus-pension lifted by the district court in Louisiana, the newmoratorium is not based strictly on depth; rather, DOI’snew decision suspends drilling operations based on thetype of blowout prevention technology being used. DOIhas indicated that the moratorium will last untilNovember 30 in order to allow for new safety regulationsto be implemented for deepwater operations.l

Endnotes1. Press Release, DOI, Interior Issues Directive to Guide Safe,

Six-Month Moratorium on Deepwater Drilling (May 28,2010) (on file with author).

2. Id. 3. Order at 22, Hornbeck Offshore Services v. Salazar, No. 10-

633 (E.D. La. June 22, 2010). 4. 43 U.S.C. § 1334(a)(1).5. 5 U.S.C. § 706(2)(A).6. Order, supra note 3 at 17.7. Id. at 19.8. Id. at 21.9. Id.10. Motion for a Stay at 14, Hornbeck Offshore Services v.

Salazar, No. 10-30585 (5th Cir. June 25, 2010).11. Id. at 21.12. Order at 2, Hornbeck Offshore Services v. Salazar,

No. 10-30585 (5th Cir. July 8, 2010).13. Press Release, DOI, Secretary Salazar Issues New

Suspensions to Guide Safe Pause on Deepwater Drilling(July 12, 2010) (on file with author).

S. Beth Windham, J.D.1

BP Exploration and Production Inc. (“BP”) moved tocentralize 70 lawsuits filed in federal court against themand others arising out of the April 20, 2010 explosionand fire onboard Transocean’s Deepwater Horizondrilling rig and the resulting oil spill before oneMultidistrict Litigation Court.2 The cases filed against BPrange from claims for personal injuries, to claims forinjury to business or commercial interests, to claims forinjury to real or personal property and have been filed inmore than seven jurisdictions including the WesternDistrict of Louisiana, the Eastern District of Louisiana,the Northern District of Florida, the Southern District ofMississippi and the Southern District of Alabama.According to BP, at least 59 of these oil spill cases arestyled as class actions.3

The Multidistrict Litigation Panel is empowered byfederal statutory authority to transfer civil actions involv-ing one or more common questions of fact pending indifferent districts for coordinated or consolidated pretrialproceedings.4 Since its inception in 1968, the Panel hascentralized 323,258 civil actions.5 After making the deter-mination that there are common questions of fact in civilactions pending in different districts, the Panel selectswhich judge or judges and court will conduct the pro-ceedings.6 Prior to transferring any actions, the Panelmust first determine that the transfers will be for the con-venience of parties and witnesses and will promote thejust and efficient conduct of such actions.7 The Panel canconduct proceedings for the transfer of an action uponits own initiative or by motion of a party in any actionin which transfer may be appropriate.8 Notice of hear-ings on whether the transfer is to be made is given to theparties in all actions in which transfers are contemplated.At the hearing, material evidence may be offered by anyparty to an action that would be affected by the pro-ceeding, and the Panel’s order of transfer is supported byfindings of fact and conclusions of law based upon therecord at the hearing.9

Transfer of the actions has the effect of placing thembefore a single judge whose role is to ensure that discov-ery on any non-common issues proceed at the same timeas discovery on common issues and to conduct pretrialproceedings in a streamlined manner.10 Centralizationeliminates duplicate discovery, prevents inconsistent pre-trial rulings and conserves the resources of the parties,their counsel and the judiciary.11 Once the pretrial pro-ceedings are completed, each action is remanded to thedistrict court from which it was transferred, unless it waspreviously terminated.12

BP requested that the Panel transfer the oil spill casesfiled against it and others to the Southern District ofTexas, Houston Division, with Judge Lynn N. Hughespresiding. According to BP, Judge Hughes was assignedthe first oil spill case to be filed in the Southern Districtof Texas, Houston Division and is experienced in manag-ing multidistrict litigation. The principle places of busi-ness of BP and Defendants Transocean, HalliburtonEnergy Services, Inc. and Cameron InternationalCorporation are also within that district.13 Interestingly,Plaintiff Nova Affiliated, S.A. has likewise moved for cen-tralization of certain oil spill actions in the U.S. DistrictCourt for the Southern District of Texas, while someplaintiffs have moved for centralization of certain oil spillactions in the U.S. District Court for the Eastern Districtof Louisiana.14

Situating the oil spill cases in the Southern District ofTexas could present a challenge to all parties seeking toappeal issues in the pretrial proceedings. On May 28,2010, the U.S. Court of Appeals for the Fifth Circuit, theappellate court for the Southern District of Texas, held thatit was unable to hear an appeal of a dismissal by the U.S.District Court for the Southern District of Mississippi in aclass action by owners of lands and property along theMississippi Gulf Coast. The action was against oil compa-nies, including BP, and energy companies and the plaintiffswere alleging the companies’ operations caused emission ofgreenhouse gasses that contributed to global warming andadded to the ferocity of a hurricane that destroyed their


StreamliningOOILIL SSPILLPILL LLITIGATIONITIGATION

in Federal Court

property. Specifically, the Fifth Circuit held that it didnot have a quorum to decide the case, after recusal ofone of the nine judges, who had properly vacated thepanel opinion and judgment.15 [For more informationon this case, see Fifth Circuit Dismisses Climate ChangeLawsuit on page 14]. It is unknown whether the samerecusal would occur regarding cases in the oil spill liti-gation, but if so, the Fifth Circuit would be unable toaddress any appeals coming out of the Southern Districtof Texas.

While the situs may be in dispute, the Panel will like-ly consolidate the federal oil spill actions to streamline theproceedings, which will presumably result in a quickerand more economic resolution to the federal claims. Theconsolidated proceedings will also affect some cases filedin state courts where there is diversity of citizenshipbetween the parties, and cases with certain types ofclaims, such as those involving a federal question, whichmay lead to removal to federal court, and thus transfer tothe consolidated proceedings.16

l

Endnotes1. Associate at the law firm of Aultman, Tyner & Ruffin, Ltd., in

Hattiesburg, Mississippi.

2. BP’s Motion to Transfer, In RE: Deepwater Horizon IncidentLitg., MDL Docket No. ___.

3. BP’s Motion for Stay of Proceedings Pending Transfer, Parkerv. Transocean, No. 1:10CV174-HSO-JMR (D. Miss. May 7,2010).

4. 28 U.S.C. §1407(a).5. JUDICIAL PANEL ON MULTIDISTRICT LITIGATION, ANNUAL

STATISTICS OF THE U.S. JUDICIAL PANEL ON MULTIDISTRICT

LITIGATION (2009).6. JUDICIAL PANEL ON MULTIDISTRICT LITIGATION, AN

INTRODUCTION TO THE JUDICIAL PANEL ON MULTIDISTRICT

LITIGATION.7. 28 U.S.C. §1407(a).8. Id. §1407 (c).9. Id.10. In Re Vonage Marketing and Sales Practices, Litigation, 505 F.

Supp. 2d 1375 (J.P.M.L. 2007).11. In re Imagitas, Inc., Drivers’ Privacy Protection Act Litigation,

486 F. Supp. 2d 1371, 1372 (J.P.M.L. 2007).12. 28 U.S.C. §1407(a).13. Motion to Transfer, supra note 2, at 2.14. U.S. Judicial Panel on Multidistrict Litigation, Notice of

Hearing Session, June 23, 2010. 15. Comer v. Murphy Oil USA, —-F.3d —-, 2010 WL 2136658

(5th Cir. May 28, 2010).16. 28 U.S.C. §§1332 and 1331.


Photograph of controlled burn courtesyof USCG, photographer Petty OfficerFirst Class John Masson.


Mary McKenna, 2011 J.D. Candidate, Univ.of Mississippi School of Law

Following the April 20, 2010 DeepwaterHorizon drilling rig explosion and resulting oilspill, British Petroleum (BP) offered fishermen,shrimpers and oystermen (collectively fisher-men) in Louisiana payment to voluntarily par-ticipate in oil spill clean-up and mitigationefforts. BP, however, required that the volunteerfishermen sign a Master Vessel Charter Agree -ment (the Agreement) before it allowed the fish-ermen to provide the emergency clean-up ser-vices. The Agreement contained several provi-sions that compromised the fishermen’s existingand future rights and potential legal claimsagainst BP and its affiliated entities.

Fisherman George Barisich sought emer-gency relief from a federal court to stop BP from forcingvolunteer fishermen to enter into an agreement that lim-ited their claims against BP. After an emergency hearing,the U.S. District Court for the Eastern District ofLouisiana ruled that the language of certain provisions ofthe Agreement was overbroad, after which BP agreed toenter into a stipulated judgment that deleted those provi-sions from the Agreement, making them null and void.1

The court also enjoined BP from seeking to enforce anysuch agreements already executed.

BackgroundOn May 2, 2010, Barisich filed an Emergency Motionfor Temporary Restraining Order (Motion for TRO) withthe U.S. District Court for the Eastern District ofLouisiana seeking a judgment (1) enjoining BP fromrequiring that he and others sign the Agreement beforeassisting in clean-up efforts, and (2) declaring theAgreement unconscionable and that any such Agree -ments already executed be null and void, and/or enjoin-ing BP from seeking to enforce any such Agreementsalready signed.2

The controversial Agreement, drafted by BP, requiredthe fishermen to provide clean-up efforts using their ownboats. Article 13(A) of the Agreement mandated that BPbe added as an “additional assured” on the volunteers’insurance policies,3 effectively transferring financialresponsibility for any damage to the volunteers’ vessel orfor other injuries, such as to crew members, to the vol-unteers’ insurance carrier. Article 13(F) of the Agreementprovided that the vessel owner “defend, indemnify andhold [BP] harmless from all claims … related to, any loss

or damage to any property or any injury to or death ofany person” arising from the vessel owner’s performanceunder the contract, providing the claim arose from anywillful misconduct, gross negligence or negligence by thevessel owner or its crew.4 Additionally, Article 13(I)(1)stated that if a vessel owner had a claim against BP, thevessel owner would provide BP with written notice with-in thirty days of learning of the claim,5 presumably reliev-ing BP of any liability as to the number and kind ofclaims filed outside of or after one month’s time from avessel owner’s knowledge of such a claim.

Furthermore, Article 22, regarding Publicity Releasesand Marketing, essentially prohibited vessel owners andtheir employees from making any “news releases, market-ing presentation, or any other public statements” withoutBP’s prior written approval. BP retained sole discretionover grants of approval.6 In effect, this article impeded thefishermen’s free speech rights. Similarly, an attachedAgreement Regarding Propriety and ConfidentialInformation required the vessel owner to “keep confiden-tial and not disclose to others … all Data developed, dis-covered, found or learned by it or disclosed to it.”7

ResolutionBarisich and BP agreed to a Consent Judgment(Judgment) which amended the terms of the Agreementto: (a) delete Article 13(I)(1) in its entirety; (b) deleteArticle 13(F) in its entirety; (c) delete Paragraph 5 in itsentirety; (d) delete Article 22 in its entirety; and (e) tomodify Article 13(A) by deleting it in its entirety exceptfor the beginning of the first sentence (which requires thevessel owner to maintain any insurance policies it was car-

Federal CourtInvalidatesOne-Sided

Vessel CharterAgreement


rying prior to entering into the Agreement).8 The delet-ed provisions became null and void, and the courtenjoined BP from enforcing the Agreement against anyvolunteers who had agreed to the deleted or modifiedprovisions in identical or substantially similar docu-ments. Additionally, the Judgment required BP toinform those volunteers who had agreed to the deleted ormodified provisions that the language had been deletedor modified and declared null and void. Likewise, theJudgment enjoined BP from requiring any volunteer tosign an Agreement containing the deleted or modified,null and void language.9

ConclusionThough oil spill litigation will continue, the court’s deci-sion bodes well for Gulf Coast fishermen. The judgmentmandated that BP abide by the amended Agreement,regardless of the state in which the document is enteredand regardless of the domicile or residence of the volun-teer who signs it.10 In other words, the Judgment appliesthe same protections to any U.S. citizen, not just thosefishermen in Louisiana.11 The court also clarified thatBarisich reserved all rights to challenge the remainingprovisions within the Agreement (or any other BP docu-ment requiring signature) on any basis available underlaw, while similarly reserving all rights and defenses to

BP.12 Such explicit reservation of rights foreshadows thatlitigation awaits.l

Endnotes1. Barisich v. BP, P.L.C., No. 10-1316 (E.D. La. May 4, 2010).

On June 22, 2010, this case was transferred and consolidatedwith other cases in Section “J” of this court awaiting a decisionof the Judicial Panel on Multidistrict Litigation.

2. Complaint at 8, Barisich v. BP, No. 10-1316 (E.D. La. May 2,2010).

3. Master Vessel Charter Agreement, attached to Complaint asExhibit A, at 5.

4, Id. at 6.5. Id.6. Id. at 8. 7. Id. at Exhibit C. 8. Consent Decree at 1-2, Barisich v. BP, No. 10-1316 (E.D. La.

May 4, 2010). 9. Id. at 2-3.10. Id. at 2. 11. The Court, however, specified that the Judgment does not

apply to those commercial enterprises that own or operatemultiple vessels that were in the business of oilfield support oroilfield clean-up or mitigation prior to Apr. 20, 2010. Nordoes the Judgment apply to vessels contracted for purposesother than mitigation or clean-up of oil from the DeepwaterHorizon explosion, or to any contracts entered into beforeApr. 20, 2010. Id. at 3.

12. Id.

Photograph of a “vessel of opportunity” courtesy of the U.S. Air Force, photographer Bryan Nealy.


Lindsey Etheridge, 2011 J.D. Candidate, Univ. ofMississippi School of Law

The Supreme Court of Florida recently held that com-mercial fishermen may seek damages for lost incomeresulting from spilled pollutants. The fishermen sought torecover monetary losses that occurred when a companyspilled pollutants into Tampa Bay, damaging marine andplant life. The court allowed the fishermen to recoverdamages despite the fact that they had suffered no prop-erty damage from the spill.1 As oil from the DeepwaterHorizon oil spill begins washing ashore in Florida, thisdecision may provide an additional avenue of recovery forcommercial fisherman in Florida.

BackgroundMosaic Fertilizer, L.L.C. (Mosaic), managed a phospho-gypsum2 storage area near Archie Creek in HillsboroughCounty, Florida. A portion of the storage area consists ofa pond enclosed by dikes, which contained wastewaterfrom a phosphate plant. The wastewater was contaminat-ed with pollutants and hazardous substances. The FloridaDepartment of Environmental Protection (FDEP)warned Mosaic in the summer of 2004 that the pond didnot meet its minimum size requirements. Additionally,both the FDEP and the Hillsborough CountyEnvironmental Protection Commission alerted Mosaicthat the amount of wastewater in the pond was on theverge of exceeding the safe storage level.3

On September 5, 2004, the wastewater in the pondrose to the top of the dike; the dike gave way and spilledpollutants into Tampa Bay. Howard Curd and severalother commercial fishermen (the fishermen) claimed thatthe spilled pollutants caused the loss of underwater plantlife, fish, baitfish, crabs, and other marine life. They didnot claim any property damage or ownership interest inthe injured marine life. Instead, they sought damages forloss of income and lost profits resulting from “damage tothe reputation of the fishery products the fishermen areable to catch and attempt to sell.”4 Damages such as lostincome and profits are considered “purely economic dam-

ages” because the damages occur without simultaneousproperty or bodily injury damages.

The fishermen filed suit under Florida Statute §376.313(3), which provides for individual causes ofaction for pollution of surface and ground waters.Additionally, the fishermen argued that Mosaic’s actionsconstituted negligence and triggered Florida’s commonlaw strict liability in that Mosaic used its property for anultrahazardous activity. The trial court ruled that the lan-guage of the statute did not permit the fishermen to claimmonetary losses unless they also suffered property damagefrom the pollution. For the same reason, the court foundthat the strict liability and simple negligence claims werenot allowed.5 The fishermen appealed to Florida’s SecondDistrict Court of Appeal, which affirmed the trial court’sorder dismissing the fishermen’s case against Mosaic. TheSecond District certified the following questions to theFlorida Supreme Court:

(1) Does Florida recognize a common law theoryunder which commercial fishermen can recoverfor economic losses proximately caused by thenegligent release of pollutants despite the factthat the fishermen do not own any property dam-aged by the pollution?

(2) Does the private cause of action recognized insection 376.313 permit commercial fishermen torecover damages for their loss of income despitethe fact that the fishermen do not own any prop-erty damaged by the pollution?6

Statutory Cause of ActionThe court began its analysis with the statutory claim.Florida Statutes Chapter 376 governs pollutant dischargeprevention and removal. Section 376.302 prohibits thedischarge of pollutants or hazardous substances into orupon surface or ground waters. Any person in violation isliable for any damage caused.7 The fishermen filed suitunder § 376.313(3), which allows individual causes ofaction for damages under certain sections in Chapter 376.

Florida Fishermen May RecoverDamages from Pollutant Spill

Photograph of shrimper courtesy of NOAA.

10 • JULY 2010 • WATER LOG 30:2

The section states, in pertinent part, “nothing contained in[the sections regarding pollution of surface and groundwaters] prohibits any person from bringing a cause ofaction…for all damages resulting from a discharge or othercondition of pollution…”8 At issue here was whether or notthis provision allowed the commercial fishermen to recoverlost income resulting from the pollution even though theysuffered no property damage.

To determine whether the statutory provision allowedfor this recovery, the court looked first to the plain languageof the statute. When the language of a statute is clear andunambiguous, the court does not need to look further todetermine legislative intent. After examining the statute andseveral other provisions regarding pollution of surface andground waters, the court determined that the languagewas clear and unambiguous; § 376.313(3) allows anyperson to recover for all damages suffered as a result of pol-lution.9 The statute calls for the liberal construction of itsprovisions and defines damages as “the documented extentof any destruction to or loss of any real or personal proper-ty, or the documented extent…of any destruction of theenvironment and natural resources, including all livingthings except human beings, as the direct result of the dis-charge of a pollutant.”10

The court concluded that the legislature deliberatelyomitted any language requiring ownership of property as aprerequisite to recover damages resulting from pollution.The only defenses to a cause of action under § 376.313(3)are “acts of war, acts by a governmental entity, acts of God,and acts or omissions by a third party,” with no mention ofa lack of property ownership as a defense.11 Section376.313(3) also states that “in any such suit… [a] personneed only plead and prove the fact of the prohibited dis-charge or other pollutive condition and that it hasoccurred.” In addition, the Florida Supreme Court previ-ously held that the cause of action does not require theplaintiff to plead or prove negligence in any form, only thatthe discharge occurred.12

After liberally construing the language of the statute andsurrounding provisions, the court found that § 376.313 allowsfor private causes of action by any individual able to demon-strate damages within the context of the statute. The courtconcluded that nothing in the statute prevents commercialfishermen from bringing an action pursuant to § 376.313(3)for purely economic losses.13

Common Law Causes of ActionThe court next considered whether Florida recognizes acommon law theory under which the fishermen couldrecover economic losses “proximately caused by the negli-

gent release of pollutants despite the fact that the fishermen[did] not own any real or personal property damaged by thepollution.”14 The lower court had found that the fishermen’scommon law claims were barred by two legal principles: (1)the economic loss rule and (2) duty of care. In reviewing thelower court’s decision, the court first addressed whether theeconomic loss rule applied to this situation. The economicloss rule is a judicially created doctrine that bars a negli-gence action to recover solely economic damages. The ruleis applicable in only two situations: (1) where the parties arein contractual privity, or (2) where the defendant is a man-ufacturer or distributor of a defective product that damagesitself. Finding that neither scenario applied to the facts ofthis case, the court determined that the economic loss ruledid not apply.15 Instead, the claims are governed by tradi-tional negligence law (including proof of duty, breach, andproximate cause) and principles of strict liability.

To that end, the court next turned to the issue of dutyof care, specifically whether Mosaic owed the fishermen aduty of care to protect their economic interests. A duty ofcare refers to the legal obligation to maintain a certain stan-dard of conduct to protect others against unreasonable risksand is a necessary element of negligence.16 In conducting itsanalysis, the court initially considered whether the fisher-men were altogether excluded from the class of personsowed a duty of care by the lack of personal or bodily injurydamages. In some jurisdictions, a person cannot recover foreconomic losses based on negligence when that person hasnot sustained bodily injury or property damage. Thisrequirement was designed to prevent a possible negligent actfrom leading to countless unforeseeable claims of lost eco-nomic opportunities.

The fishermen contended that their position is anexception to this general rule because they are licensed bythe state and have a “protectable economic expectation inthe marine life that qualifies as a property right.”17 Thecourt looked at several analogous cases where commercialfishermen were allowed to recover for injuries to marine lifeas a result of activities that occurred on land. In these cases,courts found that fishermen suffer a peculiar or special harmwhen waters are polluted in that they suffer a diminution orloss of livelihood.18 The court agreed and concluded thatMosaic did owe the fishermen a duty of care.

Finally, the court considered whether the fishermen fellwithin the foreseeable zone of risk for which Mosaic owed aduty. Under Florida law, the concept of foreseeability islinked to the question of whether a duty is owed. A personis not obligated to protect others from unforeseeable risks,only from reasonably foreseeable risks. The court has heldthat duties may arise from four general sources: (1) legisla-

JULY 2010 • WATER LOG 30:2 • 11

tive enactments or administrative regulations; (2) judicialinterpretations of such enactments or regulations; (3)other judicial precedent; and (4) a duty arising from thegeneral facts of a case. The fourth category encompasses“that class of cases in which the duty arises because of aforeseeable zone of risk arising from the acts of the defen-dant.”19

According to the court, the duty Mosaic owed thefishermen arose out of the nature of Mosaic’s business andthe special economic interest of the fishermen in the useof the public waters. Mosaic’s business of storing pollu-tants and hazardous contaminants created a foreseeablezone of risk, and Mosaic had a duty to protect those with-in the zone who might be harmed. The fishermen werewithin the zone of risk because they were licensed to fishin Tampa Bay, and they depended upon those waters toearn their livelihoods. It was foreseeable that, were thepollutants to spill into Tampa Bay and damage the marineand plant life, the fishermen’s special economic interest inthe waters would be harmed. The court declared the

spilling of the pollutants a “tortious invasion that inter-fered with the special interest of the commercial fisher-men to use those public waters to earn their livelihood.”20

This breach of duty allowed the fishermen to pursue anaction in negligence against Mosaic.

DissentOne Florida Supreme Court Justice dissented in part withthe majority opinion. Justice Polston agreed with themajority that the fishermen had a statutory cause ofaction under § 376.313, but disagreed that they couldrecover for purely economic losses under a negligence

action. The justice argued that the fishermen did not havea special interest that created a duty on Mosaic’s part toprotect them. He contended that if the fishermen wereallowed to recover in this case, then liability would belimitless. Other entities could begin claiming a specialinterest in the use of public waters, such as hotels andrestaurants near beaches, seafood truck drivers, and beachcommunity realtors. Justice Polston would have affirmedthe lower court’s decision that Mosaic did not owe thefishermen an independent duty of care to protect theirpurely economic interests.21

ConclusionThe court’s decision to allow recovery for purely eco-nomic damages resulting from pollution is of particularsignificance in light of the Deepwater Horizon oil spill.Although the Florida Supreme Court limited recovery tothose commercial fishermen whose livelihoods dependupon the polluted waters, the potential class of impactedcommercial fishermen arising from the oil spill is daunt-ing. However, to prevail on negligence, fishermen willneed to prove that they possess a unique interest in themarine life affected by the spill (separate from the inter-est of the general public) and that they belong in theresponsible parties’ foreseeable zone of risk.l

Endnotes1. Curd v. Mosaic Fertilizer, L.L.C., 2010 Fla. LEXIS 944 (June

17, 2010).2. Phosphogypsum is a by-product of processing phosphate rock

with sulfuric acid to produce phosphoric acid used in fertiliz-er.

3. Curd v. Mosaic, 2010 Fla. LEXIS at *3.4. Id. 5. Id. at *4.6. Id. at *4-5.7. FLA. STAT. § 376.302 (2010).8. Id. § 376.313(3).9. Curd v. Mosaic, 2010 Fla. LEXIS at *6-10.10. FLA. STAT. § 376.315, § 376.031(5).11. Id. § 376.308.12. Aramark Uniform & Career Apparel, Inc. v. Easton, 894 So.

2d 20 (Fla. 2004).13. Curd v. Mosaic, 2010 Fla. LEXIS at *14.14. Id.15. Id. at *17-18.16. Id. at *30.17. Id. at *20.18. Id.19. Id. at *31.20. Id. at *31-33.21. Id. at *33-50.

The court declaredthe spilling of

the pollutants a“tortious invasion . . .

12 • JULY 2010 • WATER LOG 30:2

Lindsey Etheridge, 2011 J.D. Candidate, Univ. ofMississippi School of LawNiki L. Pace, J.D., LL.M.

On June 1, 2010, U.S. Attorney General Eric Holderassured the American people that the Department ofJustice (DOJ) would “prosecute to the full extent anyviolations of the law” committed by BP and othersinvolved, namely, Transocean and Halliburton, in theDeepwater Horizon oil spill.1 To that end, DOJ isreviewing the actions of all parties involved (collective-ly responsible parties) for any possible violations or ille-gal behavior. The investigation includes a look intopotential violations of the Clean Water Act, theMigratory Bird Treaty Act, and the Endangered SpeciesAct, as well as the Oil Pollution Act of 1990. This arti-cle provides a look at likely criminal sanctions responsi-ble parties may face under environmental laws.

Clean Water ActIn passing the Oil Pollution Act of 1990, Congressamended the Clean Water Act’s (CWA) list of criminalviolations to include negligent discharge of oil.2 Asamended, § 311 of the CWA carries specific liabilityprovisions related to oil spills and contains an expressprohibition against harmful discharges of oil into navi-gable waters of the United States. Those discharging theoil may also face prosecution for failure to report an oilspill or providing false information regarding the spill.3

Additionally, the CWA prohibits the unauthorized dis-charge of pollutants into U.S. waters and violations ofestablished water quality standards. Those found in vio-lation of the Act may face criminal penalties.

In assessing a potential violation, the CWA distin-guishes among negligent violations, knowing violations,and knowing endangerment, with increasing penalties,respectively.4 A negligent violation is an act of ordinarynegligence which leads to a discharge of a pollutant.Ordinary negligence occurs when one fails to use suchcare as a reasonably prudent and careful person woulduse under similar circumstances.5 A knowing violation

requires the government to prove that the defendantknew the nature of his acts and performed them inten-tionally. It is not necessary to prove that the defendantknew his actions were unlawful.6 To show knowingendangerment, the defendant must possess actual knowl-edge or belief that his conduct placed another person inimminent danger of death or serious bodily injury.7

The CWA imposes a range of criminal penaltiesfrom fines as low as $2,500 and/or imprisonment for upto one year for negligent violations to fines as high as$250,000 and/or imprisonment for up to 15 years forknowing endangerment. In addition, when an organi-zation, as opposed to an individual, is convicted ofknowing endangerment, the organization can be subjectto a fine of up to $1 million.8 The decision to bringcriminal charges by the federal government is discre-tionary, not mandatory. In deciding whether to pursuecriminal prosecution, the government may consider fac-tors such as prior history of the violator, the preventa-tive measures taken, the need for deterrence, and theextent of cooperation.

Endangered Species ActThe Endangered Species Act (ESA) provides legal pro-tection for endangered and threatened species alongwith the ecosystems on which they depend (termed“critical habitat” by the ESA). The Act achieves theseprotections primarily through two provisions: § 7 (con-sultation) and § 9 (take prohibitions). Section 7requires consultation by federal agencies to ensure thattheir actions (including the issuance of permits) do notjeopardize endangered species.9 While this provision isunlikely to trigger enforcement actions against respon-sible parties, the Center for Biological Diversity hasissued its “Notice of Intent to Sue” several federal agen-cies, alleging agency failure to comply with § 7 withregard to oil spill related activities.

Responsible parties, however, may face substantialpenalties for violations of § 9. Section 9 forbids the tak-ing of an endangered species; the provision extends tothe territorial sea as well as the high seas.10 The ESA

AA LLooookk aatt PPoossssiibbllee

CRIMINAL CHARGESArising From the Gulf Oil Spill

JULY 2010 • WATER LOG 30:2 • 13

defines take as “to harass, harm, pursue, hunt, shoot,wound, kill, trap, capture, or collect, or to attempt toengage in any such conduct.”11 Regulations furtherbreak down the provision by defining harm as “an actwhich actually kills or injures wildlife,” and explainingthat “[s]uch act may include significant habitat modifi-cation or degradation where it actually kills or injureswildlife by significantly impairing essential behavioralpatterns, including breeding, feeding, or sheltering.”12

The ESA places criminal penalties on any person whoknowingly violates any provision. Criminal penaltiesconsist of a maximum fine of $50,000 and/or impris-onment for not more than one year, or both.Additionally, lessees of federal lands could face potentialrevocation of their leases if convicted of criminal viola-tions of the ESA.13

In the Gulf of Mexico, the U.S. Fish & WildlifeService has identified 38 protected plant and wildlifespecies that may be impacted by the oil spill, including29 endangered species. The species range from birds toreptiles and include the West Indian manatees, whoop-ing cranes, Mississippi sandhill cranes, gulf sturgeon,and four species of sea turtles.14 The National MarineFisheries Service also lists the endangered sperm whaleas potentially impacted by the oil spill.

Marine Mammal Protection ActMarine mammals receive additional protection underthe Marine Mammal Protection Act (MMPA). Enactedin 1972, the MMPA prohibits the taking of a marinemammal without a permit, much like the ESA, anddefines take to mean “harass, hunt, capture or kill….”15

The Act extends beyond U.S. waters to include thehigh seas as well. However, the MMPA includes threestatutory exceptions. Most notably, the Act permits,upon request, the authorization of the unintentionaltaking of “small numbers of marine mammals” inci-dental to activities such as outer continental shelf oiland gas development.16 This exception is limited,however, to instances that will have only a “negligibleimpact” on the species and its habitat. The MMPAcarries substantial penalties. Individuals face civilpenalties of up to $10,000 for each violation.Knowingly violating the act may garner an individuala fine as high as $20,000 per violation and/or one yearimprisonment.17

Migratory Bird Treaty Act The Migratory Bird Treaty Act (MBTA) prohibits thehunting, taking, capturing, killing, selling, and trans-porting of any native U.S. migratory bird, nest, or egg,at any time and by any means or in any manner.18 A vio-lation of the MBTA is a misdemeanor. Anyone con-victed is subject to a maximum fine of $15,000 or max-imum imprisonment of six months, or both.19

While the MBTA is primarily concerned withintentional hunting and capturing of migratory birds,many courts have held that a person may violate theAct without intent or knowledge; therefore a violationis, in effect, a strict liability crime.20 Courts have sim-ilarly held that a person’s activities, though notexpressly directed at the taking of any wildlife, violatethe Act if they have the incidental effect of killing pro-tected species.21 The language of the MBTA supports

this interpretation with itsuse of the phrase “by anymeans or in any manner” andincluding “kill” among theprohibited actions, whichdoes not necessarily indicateintent.22 How ever, a Louisianadistrict court ruled in 2009that the MBTA is not intend-ed “to apply to commercialventures where, occasionally,protected species might beincidentally killed as a resultof totally legal and permissi-ble activities.”23 In reachingthis conclusion, the districtcourt distinguished its hold-ing from other cases where

Criminal Charges continued on p. 15

Photograph courtesy of the USCG, photographer Petty Officer 2nd Class John Miller.

14 • JULY 2010 • WATER LOG 30:2

Niki L. Pace, J.D., LL.M.

On May 28, 2010, the U.S. Court of Appeals for theFifth Circuit issued an unusual procedural decision inComer v. Murphy Oil. Lacking a quorum to decide thecase, the court dismissed the appeal and reinstated thedistrict court’s dismissal on the grounds that the earlierdecision to hear the case en banc had vacated the originalFifth Circuit panel decision.1 The case was decided 5-3with two dissenting opinions.

The lawsuit originated from property claims follow-ing Hurricane Katrina. Residents of the Mississippi GulfCoast who suffered property damage during the hurri-cane filed suit against numerous members of the energy,fossil fuel, and chemical industries. The residents allegedthe oil companies contributed to climate change throughtheir greenhouse gas emissions which increased globalsurface temperatures causing sea level rise and contribut-ing to the ferocity of Hurricane Katrina. The residentsclaimed these events culminated in the destruction of pri-vate and public property.2

The case was originally dismissed by the district courton grounds of standing and political question. On appealto the Fifth Circuit, a three-judge panel reversed the dis-trict court and recognized a plausible link between green-house gas emissions and climate change sufficient for res-idents to establish standing. The panel also found that theclaims did not present non-justiciable political questions.3

In March, a quorum of nine members of the court votedto rehear the case en banc, meaning the case would bereheard by the full membership of the Fifth Circuit.When issued, the en banc ruling would replace the deci-sion of the three-judge panel.4

Following the decision to hear the case en banc, cir-cumstances changed. One of the nine judges comprisingthe quorum for this case was disqualified and removed.This left only eight judges, on a court of sixteen, whowere not disqualified from this case. With only eightjudges, the court was left without a quorum; without a

quorum, the court lacks authority to transact judicialbusiness.5

In reaching its decision to reinstate the district court’sopinion, the court considered and rejected five otheroptions: 1) asking the Chief Justice to appoint a judgefrom another circuit, 2) declaring a quorum under theFederal Rules of Appellate Procedure 35(a), 3) adoptingthe rule of necessity which would allow disqualifiedjudges to participate, 4) “dis-enbancing” the case andordering the panel opinion reinstated; and 5) holding thecase in abeyance until the composition of the courtchanges.6 For various reasons, the court considered eachof these options inadequate. Instead, the court chose tostrictly apply Local Rule 41.3 which states: “Unless oth-erwise expressly provided, the granting of a rehearing enbanc vacates the panel opinion and judgment of the courtstays the mandate.”7 Relying on this rule, the court deter-mined that the original panel decision was vacated at thetime the court, with a quorum, voted to re-hear the mat-ter en banc. Therefore, the court reasoned, the previous-ly vacated panel decision could not be reinstated.

Judge Eugene Davis, joined by Judge Carl Stewart,expressly objected to the majority’s strict application ofLocal Rule 41.3, arguing that the rule was misapplied inthis instance. Providing a separate analysis, Judge Dennisargued in his dissent that, under the appropriate defini-tion, the en banc court did have a quorum. He furtheropined that dismissal of the case “violates the rule thatfederal courts have an absolute duty to render decisions incases over which they have jurisdiction.”8

While the ruling itself deals with procedural issueswithin the Fifth Circuit, the broader implications of theopinion have led to speculation over its impact on futureoil spill litigation. Some commentators argue that manyof the Fifth Circuit judges have financial and/or personalinterests in the oil industry which may result in theirrecusal in future lawsuits arising from the DeepwaterHorizon oil spill. This may lead to an inadequate pool ofjudges to hear appeals. Should such circumstances occur,

Fifth Circuit DismissesClimate Change Lawsuit

JULY 2010 • WATER LOG 30:2 • 15

the taking occurred as a result of prohibited acts, imply-ing that the higher standard of strict liability would stillapply to violations resulting from the oil spill.

Oil Pollution Act of 1990While criminal charges for violating the OPA are foundin CWA § 311 (discussed above), the OPA provides for arange of other penalties. In addition to cleanup costs andother financial obligations, the OPA imposes civil penal-ties for failure to satisfy OPA’s financial responsibilityrequirement. This requirement obligates responsible par-ties to provide financial assurance to the federal govern-ment of their ability to meet potential financial obliga-tions under the OPA. These obligations include the abil-ity to pay for cleanup costs, damages to natural resources,and other costs.24

The statutorily defined obligation for an offshorefacility located in federal waters is $35 million.However, the President may require a higher amount,up to $150 million, where he determines the amount isjustified “based on the relative operational, environ-mental, human health, and other risks” posed by theoperation.25 Failure to comply with this provision mayresult in a maximum civil penalty of $25,000 per dayand/or judicial action against the responsible party,including a judicial order terminating operations.26 Theact also preserves the authority of state and federal gov-ernments to impose fines or penalties (both criminaland civil) for violations of other laws relating to the oilspill.27 Texas, Louisiana, and Florida each have state spe-cific oil spill laws that may apply.

ConclusionDOJ continues to investigate responsible parties for anypotential violations of these acts along with other crimi-nal statutes. Attorney General Eric Holder has vowed toprosecute those responsible to the fullest extent of thelaw, claiming “We will not rest until justice is done.”28

Meanwhile, the presidentially created BP DeepwaterHorizon Oil Spill and Offshore Drilling Commissionbegan proceedings mid-July in New Orleans. The

Commission is tasked with providing recommendationson preventing and mitigating any future offshore drillingoil spills.l

Endnotes1. Eric Holder, U.S. Attorney General, Remarks on the Gulf Oil

Spill (June 1, 2010) (transcript available at http://www.jus-tice.gov/ag/speeches/2010/ag-speech-100601.html).

2. 33 U.S.C. § 1319(c) (2010).3. Id. § 1321(b)(3), (5).4. Id. § 1319(c).5. See United States v. Ortiz, 427 F.3d 1278 (10th Cir. 2005);

United States v. Hanousek, 176 F.3d 1116 (9th Cir. 1999).6. United States v. Hopkins, 53 F.3d 533, 539 (2nd Cir. 1995).7. 33 U.S.C. § 1319(c)(3)(B)(i).8. Id. § 1319(c).9. 16 U.S.C. § 1536.10. Id. § 1538(a).11. Id. § 1532(19).12. 50 C.F.R. § 17.3 (2010).13. 16 U.S.C. § 1540(b), (c) (2010).14. U.S. Fish & Wildlife, Wildlife Threatened by Gulf Oil Spill,

(June 2010), available at http://www.fws.gov/home/dhoil-spill/pdfs/FedListedBirdsGulf.pdf.

15. 16 U.S.C. §§ 1372 & 1362(13).16. Id. § 1371(a)(5).17. Id. § 1375.18. 16 U.S.C. §§ 703-712 (2010).19. Id. § 707(a).20. See, e.g., Rogers v. United States, 367 F.2d 998, 1001 (8th Cir.

1966); United States v. Corbin Farm Serv., 444 F. Supp. 510,534 (E.D. Cal. 1978), aff ’d, 578 F.2d 259 (9th Cir. 1978);United States v. Moon Lake Elec. Ass’n, Inc., 45 F. Supp. 2d1070, 1073 (D. Colo. 1999).

21. See United States v. FMC Corp., 572 F.2d 902 (2d Cir. 1978);United States v. Apollo Energies Inc., 2009 U.S. Dist. LEXIS6160, 2009 WL 211580 (D. Kan. 2009).

22. 16 U.S.C. § 703(a) (2010).23. United States v. Chevron USA, Inc., 2009 U.S. Dist. LEXIS

102682, 2009 WL 3645170 (W.D. La. 2009).24. 33 U.S.C. § 271625. Id. § 2716(c)(1)(C).26. Id. § 2716a.27. Id. § 2718(c).28. Eric Holder, supra note 1.

it is unclear following Comer how the court will handleappeals in the future. Already, one federal judge has facedcriticism for hearing a challenge to the drilling moratori-um while owning stock in certain oil companies.l

Endnotes1. Comer v. Murphy Oil USA, —- F.3d —-, 2010 WL 2136658

(5th Cir. May 28, 2010) (en banc).

2. Comer v. Murphy Oil USA, 585 F.3d 855 (5th Cir. 2009)(vacated).

3. Id.4. Comer v. Murphy Oil USA, 2010 WL 2136658 at *3.5. Id.6. Id. at *3-*4.7. Id. at *4.8. Id. at *8 (Dennis, J., dissenting).

Criminal Charges from p. 13

April Hendricks, 2012 J.D. Candidate, Univ. ofMississippi School of Law

In June, the U.S. Supreme Court ruled on beachfrontproperty owners’ challenge to a beach renourishment pro-ject, finding for the State of Florida. The property owners,through the organization Stop the Beach Renourishment,claimed the state had taken their property rights withoutcompensation in violation of the U.S. Constitution.Because the restored portion of the beach became stateowned land, the homeowners argued that they lost theirright to have their property touch the water.1 Rejectingthis argument, the Supreme Court unanimously ruledthat no taking occurred. The Court remained divided,however, on the issue of judicial takings.

BackgroundIn 1995, Hurricane Opal caused significant damage tolocal beaches around Walton County, Florida. To repairthe damaged beaches, Walton County and the City ofDestin (collectively Walton County) decided to under-take a restoration project in 2003. Walton Countyplanned to restore approximately 6.9 miles of beach using75 feet of newly added sand and sought the appropriatepermits from the Florida Department of EnvironmentalProtection (FDEP) under the Beach and ShorePreservation Act (BSPA).

Concerned that the project would alter their proper-ty rights, local beachfront property owners formed Stopthe Beach Renourishment, Inc. (STBR) to voice theirconcerns. After unsuccessfully challenging the permitsthrough the FDEP administrative process, the group filedsuit and a lengthy legal battle ensued. The lower courtagreed with STBR’s contention that the beach restorationproject infringed upon their right to have their propertytouch the water as well as their right to receive accretionsto their property through gradual accumulations of land.2

The Florida Supreme Court reversed the lower court,finding that, as long as landowners can access, use, and

view the water, littoral owners have no specific right fortheir property to remain in continual contact with theocean.3 Accordingly, the renourishment plan proposed byWalton County did not amount to a taking of thelandowners’ beachfront properties.4 The members ofSTBR considered the Florida Supreme Court’s decisionto be an unconstitutional taking of their littoral rightsand appealed to the U.S. Supreme Court, which grantedthe petition for review.

Littoral Property RightsUnder Florida law, the state owns in trust for the publicany land submerged beneath navigable waters, and themean high-water line generally separates state-ownedlands from littoral property (land abutting the ocean, sea,or lake).5 The state holds title to any property seaward ofthe mean high-water line, while littoral owners hold titleto land above (inland of ) that line. Littoral owners mayreceive title to dry land added to their property by accre-tion, a process by which new land gradually emerges;however, when the new land is the result of suddenchanges, this new land belongs to the state, not the lit-toral owners. Sudden events that cause a change in thesurrounding land are known as avulsions.

In Florida, beach restoration activities are governedby the Beach and Shore Preservation Act. When a renour-ishment project is undertaken, the BSPA provides that anerosion control line (ECL) will serve as the boundarybetween privately owned property and lands owned bythe State. After the ECL is established, the common lawrule that upland property owners are entitled to accre-tions ceases to operate. Any newly created beach belowthe ECL becomes the property of the state.

Takings ClaimThe Takings Clause of the Fifth Amendment of the U.S.Constitution prohibits private property from being“taken for public use, without just compensation.”6 Inother words, the government cannot take private property

16 • JULY 2010 • WATER LOG 30:2

U.S. Supreme CourtFinds No Taking

in Florida Beach Renourishment Challenge

JULY 2010 • WATER LOG 30:2 • 17

without paying the owner fair market value for that prop-erty. The Supreme Court notes that the Takings Clauseapplies as readily to littoral rights, as discussed in the pre-sent case, as to estates in land. Though takings claims gen-erally involve the state or a private entity receiving title toland through eminent domain, any state action that consti-tutes the taking of private property without compensationviolates the Takings Clause of the Fifth Amendment.7

STBR contended that the ruling of the FloridaSupreme Court comprised an unconstitutional taking oftheir littoral rights without just compensation. They point-ed to two littoral rights in particular: the right to futureaccretions and the right to have their property line remainin contact with the water. The Supreme Court determinedthat the Florida Supreme Court could only violate theTakings Clause by nullifying established property rights.Since the landowners failed to show that the FloridaSupreme Court’s decision was contrary to well-establishedcommon law principles, no judicial taking occurred.8

To determine if these two alleged rights are establishedproperty rights in Florida, the Court discussed two basictenets of Florida property law. First, the state has the rightto fill the area with sand to restore the beach under theBSPA because the state owns the land seaward of the meanhigh-water line. Second, if a sudden change, or avulsion,uncovers land seaward of the landowners’ properties, thestate holds the title to this newly exposed land, regardless ofwhether the land separates the water from upland property.Florida law provides no exception to the principle of avul-sion for situations where the state, as owner of the newlyexposed beach, actually caused the avulsion to occur byphysically filling the area with dredged sand.9 In otherwords, Florida law authorizes the state to restore its beach-es, and the state, in doing so, suddenly exposes land as istypical of avulsive processes. Thus, the Court found thatunder traditional common law principles the landowners’right to future accretions was subordinate to the state’s rightto fill its seabed.10

In discussing the landowner’s assertion of the right tohave their property touch the water, the Court stated thatthe landowners misinterpreted the dicta on which they soheavily relied from Board of Trustees of Internal ImprovementTrust Fund v. Sand Key Assoc., which states that propertyowners have “the right to have the property’s contact withthe water remain intact.”11 The Court noted that this rightis always included in the right of an upland landowner toaccess the water, and the state’s ownership of the restoredbeach does not disrupt the landowner’s ability to access,use, and view the ocean.12 Thus, neither this right nor theright to receive future accretions supercede the state’s right

to maintain its own land. Accordingly, the Florida SupremeCourt’s decision to allow the state to restore the beachesadjacent to these properties does not constitute the takingof these landowners’ littoral rights.

Judicial TakingsIn deciding the present case, the Supreme Court for thefirst time addressed whether a court’s ruling can result in ajudicial taking. A judicial taking refers to the concept thata court decision that deprives someone of his or her prop-

erty rights without compensation could constitute a takingunder the Fifth Amendment. No justice questioned thatthe Florida Supreme Court had not effectuated a judicialtaking; however, the eight justices participating in thisopinion could not agree as to whether defining the conceptof a judicial taking was essential to resolving this dispute.

The plurality, which included Justices Scalia, Thomas,and Alito as well as Chief Justice Roberts, maintained that, inorder to articulate when a judicial taking occurs, the actionsthat constitute such a taking must be properly defined.13 Theplurality went on to note that the Takings Clause is directedmore toward the action of taking, rather than the party initi-ating the taking. Thus, this clause prohibits the state fromtaking private property without just compensation, regardlessof the branch effectuating the taking.14 Accordingly, the plu-rality determined that the judiciary is fully capable of violat-ing the Fifth Amendment by taking private property withoutcompensating the property owner.

The plurality explored and rejected each of the varyingstandards for judicial takings proposed by the parties, ulti-mately finding that if a court “declares that what was once

. . . the Supreme Courtfor the first time

addressed whether a court’s ruling can result in a judicial taking.

18 • JULY 2010 • WATER LOG 30:2

an established right of private property no longer exists, ithas taken that property,” just as the state may take privateproperty through regulation or eminent domain.15

Applying this standard to the present case, the pluralitydetermined that the actions of the Florida Supreme Courtdid not constitute a taking of the littoral owners’ properties.

In addition to the plurality, the Court issued two sep-arate concurrences on the issue of judicial takings. JusticesKennedy and Sotomayor suggested that the issue of judi-cial takings would be better addressed under the DueProcess Clause. Kennedy contended that establishing astandard for judicial takings is unnecessary, on the groundsthat the Due Process Clause provides a simpler way of pre-venting courts from depriving landowners of their proper-ty, without reaching the issue of just compensation. In par-ticular, Kennedy noted that, under the Due ProcessClause, court decisions that change the property rights thatowners expect to retain are “arbitrary or irrational” andshould be discarded.16

Justices Breyer and Ginsburg simply indicated that,because the Florida Supreme Court had not executed a tak-ing of the property at issue, the standard for judicial takingsneed not be defined at this time. Breyer notes that the plu-rality’s proposed standard for evaluating judicial takingscould flood federal courts with litigation seeking to over-turn state court property law decisions, an area that is gen-erally unfamiliar to federal judges. Because deciding whatconstitutes a judicial taking is not required to determine theoutcome of the instant case,Breyer’s concurrence takes a cau-tious approach that refuses to sub-ject federal courts to a large num-ber of potentially complex law-suits.17

ConclusionThis case marks the first time thatthe U.S. Supreme Court has ad -dressed the issue of whether a courtdecision can constitute a taking ofproperty without just compensa-tion. Though the Court unani-mously decided that the decision ofthe Florida Supreme Court did notamount to a judicial taking, theCourt remained badly divided onthe issue of whether it was necessaryto specifically define a judicial tak-ing. Because the Court split 4-4 on

this issue, the plurality’s proposed standard is not a bindingprecedent. Consequently, the issue of whether a judicial tak-ing can actually occur remains open for debate. Despite theCourt’s split on judicial takings, this decision is a clear vic-tory for Florida’s beach renourishment authority.l

Endnotes1. Stop the Beach Renourishment, Inc. v. Florida Dept. of Envtl.

Protection, 2010 WL 2400086, *17 (June 17, 2010).2. Save Our Beaches, Inc. v. Florida Dept. of Envtl. Protection, 27

So. 3d 48, 57 (Fla. Dist. Ct. App. 2006).3. Walton County v. Stop Beach Renourishment, Inc., 998 So.2d

1102, 1120. (Fla. 2008).4. Id. 5. Id. at 1105 n.3.6. U.S. Const. amend. V.7. Stop the Beach Renourishment, Inc., 2010 WL 2400086, at *78. Id. at *19.9. Id. at *16.10, Id. at *17.11. 512 So.2d 934, 936 (Fla.1987).12. Stop the Beach Renourishment, Inc., 2010 WL 2400086, at *18.13. Id. at *9.14. Id. at *8.15. Id.16. Id. at *21 (Kennedy, J., concurring in part and concurring in the

judgment).17. Id. at *25 (Breyer, J., concurring in part and concurring in the

judgment).

Photograph of beach renourishment courtesy of USACE.

Interesting ItemsAround the Gulf…Florida Governor Charlie Crist has called for a special session of the state legislature to consider a ban on offshore oildrilling in Florida by constitutional amendment. If approved, the amendment would allow voters to decide if they wanta permanent ban on offshore oil drilling in state waters. Already, offshore drilling is banned by Florida statute but couldbe repealed by legislative action. By adopting the ban as a constitutional amendment, legislators would be unable to alterthe ban without voter approval amending the constitution. The special session is scheduled for late July.

In June, the U.S. Fish and Wildlife Service (FWS) proposed the designation of critical habitat for the Mississippi gopherfrog after two environmental groups announced their intent to sue over the issue earlier this spring. The gopher froghas been listed as endangered under the Endangered Species Act (ESA) since 2001 but critical habitat was not desig-nated at that time. Critical habitat is defined by the ESA to include areas essential to the conservation of the species.Once an area is designed critical habitat, section 7(a)(2) of the ESA affords the habitat legally enforceable protectionswhich include prohibitions against the destruction or adverse modification of the critical habitat. The proposed criticalhabitat designation consists of 1,957 acres located in Forrest, Harrison, Jackson, and Perry Counties, Mississippi.Although the frog is currently found only in Mississippi, the historical range of the Mississippi gopher frog extends overAlabama, Mississippi, and Louisiana. Typical habitat consists of sandy longleaf pine forest and isolated temporary wet-lands used for breeding. The proposed rule is available at 75 Fed. Reg. 31387.

On June 30th, the Center for Biological Diversity and other environmentalgroups filed suit against BP, alleging that the oil corporation violated the ESA byburning various species of sea turtles alive during cleanup efforts in the Gulf ofMexico. The Deepwater Horizon explosion occurred as newly hatched turtles,including the critically endangered Kemps Ridley sea turtle, were migrating to sea.After the explosion, BP began using controlled burns to prevent the oil fromspreading further throughout the Gulf; however, these burning operations beganbefore rescuers could evacuate the endangered turtles from the area. According tothe Center for Biological Diversity, many turtles have been harmed or killed bythe burns, adding to the approximately 435 turtles already killed due to the oilspill. The conservation groups sought a temporary restraining order preventingfurther burns until greater protections for the turtles were achieved. On July 2nd,the conservation groups reached an agreement with BP and the Coast Guard toensure that measures will be taken to rescue sea turtles prior to burning theoil slicks. Animal Welfare Institute v. BP, No. 2:10-cv-01866 (E.D. La. 2010).

The U.S. Court of Appeals for the Fifth Circuit ruled that a vessel’s master has a duty to prudently monitor and inter-pret available weather information and that failure to do so may constitute negligence. This litigation arose from a ves-sel breaking free during Hurricane Katrina and colliding with barges and tugboats along the Mississippi River. The ves-sel master mistakenly believed that Hurricane Katrina was near the Virgin Islands and sailed the vessel to New Orleans,directly into the hurricane’s path. Here, the court declined to apply the in extremis negligence standard to the operatorsbehavior where the facts demonstrated that the vessel master “had ample time and information to know not to endan-ger the vessel by bringing it into the Port of New Orleans.” Under the in extremis standard, an operator is affordedgreater discretion when destructive natural forces force the operator to make immediate hard choices between compet-ing options. However, the standard does not apply where, as here, the captain had ample time to avoid the peril. CrescentTowing v. Chios Beauty, 2010 WL 2510126 (5th Cir. June 23, 2010).l

JULY 2010 • WATER LOG 30:2 • 19

Photograph of oiled turtles broughtin for treatment and rehabilitationcourtesy of USFWS.

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WATER LOG

WATER LOG is a quarterly publication reporting onlegal issues affecting the Mississippi-Alabamacoastal area. Its goal is to increase awareness andunderstanding of coastal issues in and around theGulf of Mexico.

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