Yes, you read the title of this post correctly: Transocean Ltd., the company that owned the Deepwater Horizon Gulf Oil Rig that blew up last year and proceeded to spew at least 200 millions of gallons of oil into the Gulf of Mexico, is actually awarding financial bonuses to its senior executives for – of all things – the “best year in safety performance in our company’s history.”
I’ve seen a lot of examples of corporate arrogance, lies, greed and deceit, but this has to rank up there with some of the worst. This company contributed to probably the worst environmental disaster and toxic tort this nation has ever seen, with the full effects not yet even being fully measured or fully felt. Its negligence, documented as being fueled by corporate cost-cutting, resulted in the deaths of 11 oil rig workers. It partnered with two other companies – BP PLC and Halliburton, Inc., who flagrantly and consistently lied to the public and to the government about the true nature and extent of the disaster. It contributed to thousands of people losing their jobs or their careers in the commercial fishing and hospitality industries, who are still suffering economically – and it has the audacity to hand out millions in cash bonuses to its executives. As has been said before, “You can’t make this stuff up.”
In regulatory papers filed with the Securities and Exchange Commission (SEC) last Friday Transocean noted “the tragic loss of life” in the Gulf when the rig operated by BP PLC exploded last April. Large of them, wasn’t that? Despite the devastating fiasco that occurred on their rig, the company got out its bean counters, and found a way to claim that it still had an “exemplary” safety record, because supposedly Transocean “met or exceeded” certain internal (i.e., its own) safety objectives regarding the frequency and severity of its accidents. “Safety” accounts for approximately 25 per cent of senior executives’ total cash bonuses at Transocean. Apprarently, greed and negligence account for the other 75 per cent. CEO Steve Newman’s bonus (alone) last year amounted to $374,062. In case you’re curious, the total pay works out as follows: A base salary of $850,000; “perks” of $622,057, which includes housing and vacation allowances (and other things); on top of the $374,062 bonus. Folded into this figure are also Transocean stock options valued at $1.9 million and deferred shares valued at $2 million.
In contrast, the average fisherman’s annual income in Louisiana, which was destroyed as the result of this ecological disaster? About $45,000.00. Annual income for a hotel room attendant, also destroyed from the loss of tourism dollars? About $32,000.00.
A commission appointed by President Barack Obama last year concluded that the explosion which set off the largest offshore oil spill in U.S. history, and which arguably represents the largest toxic tort in memory, was caused by a series of time and corporate cost-cutting decisions made by Transocean, BP and Halliburton Inc. The commission concluded these cost-cutting decisions created an “unacceptable amount of risk.” The response of Transocean and these other two huge, multi-billion dollar corporations to these findings? Denial of almost any and all legal liability. Stonewalling. Obfuscation. The legal process to determine ultimate liability and civil damages will take several years – which is just the way these companies want it. A certain federal law called the Jones Act, which governs liability for a variety of maritime civil actions and injuries, allows these companies to shield themselves from more serious legal and financial liability. The immediate punishment by the government for this gross negligence and corporate arrogance? Let’s put it this way: They’re all still in business. In fact, they’re handing out huge bonuses to their senior executives, for – -of the most insulting things they could claim – a “superior safety record.”
While most people may not have hear of it, the Jones Act is an interesting piece of federal legislation, that incorporated a great deal of tort “reform” in its passage. What this means is that it shielded a lot of maritime business operators from civil liability for various types of damages and personal injuries, and placed caps on the remaining types of damages that were allowed. That law, with all its tort “reforms”, is what is allowing these companies to thumb their noses at the people in the Gulf whose lives were so damaged by this cataclysmic environmental disaster, and at the larger American public.
Remember that the next time you hear someone from the Chamber of Commerce or the local hospital shout that what America needs is more “tort reform.”