I’ve written a considerable amount in the past about how big corporations and insurers regularly engage in cost-benefit decisions that show little regard for the safety and welfare of average Americans and consumers. If anyone has any doubts about this truth, (notwithstanding the myriad factual examples of corporate greed and disregard for Americans’ safety that have been previously offered by me and many other informed writers,) then consider this: TransOcean Corp., the owner of the Gulf oil rig that blew up on April 20 this year, spewing millions of gallons of crude oil into the Gulf of Mexico in the process, has wasted no time whatsoever in racing to federal court in Houston, Texas, to deny and/or limit liability for the incalculable environmental, financial, and physical damages that have resulted from this calamity.
Eleven rig workers are dead, millions of gallons of crude oil are spewing unstopped into one of the world’s most environmentally sensitive fishing grounds, and numerous industries and countless jobs have been impacted long into the future. The economic and financial harm that are likely to result from this spill could easily run into the billions of dollars, and this company has raced into court to deny that it is in any way responsible for this catastrophe, and to in any event limit its liability to a grand total of $26.7 million. Yes, that’s right: $26.7 million. Why the rather peculiar figure of $26.7 million, you might ask? That’s the claimed value of the rig sitting at the bottom of the ocean. That’s all TransOcean says it should be held laible for – if anything at all – as the result of this calamity. To put it to scale, that’s about 1/100th of what the total damages in this horrific event may eventually come to.
Worse, a federal judge in Houston granted TransOcean’s request, suspending all pending cases against it for the time being. On what basis does TransOcean make this claim? Under an ancient maritime law that allows vessel owners to limit their liability to the value of the vessel and its freight. Known as the Limitation of Liability Act, the law was passed in the mid-1800’s to protect U.S. maritime vessel owners, eliminate risk in some crisis situations, and aid in U.S. competition with foreign ships. Yes, that is the law that TransOcean claims applies to it now, in 2010, in the middle of one of the worst ecological catastrophes on record.