After waiting four days, Gov. Bobby Jindal on Friday finally signed controversial legislation that provides an avenue for killing a coastal erosion lawsuit filed by a New Orleans-area levee board against 97 oil and gas companies.
In so doing, he dismissed warnings from some legal experts, Attorney General Buddy Caldwell and some parish officials that the measure will imperil claims against BP arising from the 2010 Deepwater Horizon oil spill.
Jindal signed Senate Bill 469 just hours before dealing a second blow to the Southeast Louisiana Flood Protection Authority-East, which sued the oil and gas companies for their destruction of wetlands, by replacing Tim Doody, the board’s longtime president and a supporter of the suit, with someone who has previously worked in the energy industry.
Both killing the levee authority’s lawsuit and filling the board with members who would oppose pursuing the case have been among the Jindal administration’s top priorities since the suit was filed last summer. So it came as little surprise that Jindal decided to sign SB469 and tried to short-circuit a growing chorus of voices that the measure represented a serious risk to the tens of billions of dollars in lawsuits pending against BP.
Gladstone Jones, the lead attorney on the authority’s suit, said that in signing the bill Jindal put both the New Orleans area’s flood protection and the potential BP settlements in peril.
“For his own agenda, Gov. Jindal has now put over 1 million people, their lives and their property at risk,” Jones said in an emailed statement. “Further, he may very well have cost those same people and their communities billions of dollars. We now move to the judicial branch, where we will sort this out.”
Jindal’s executive counsel, Thomas Enright, drafted a lengthy memo Thursday night that outlined his legal advice to Jindal for signing the legislation. In particular, Enright wrote, the BP disaster, which happened 50 miles offshore, falls under the federal Oil Pollution Act and federal law preempts state law when there is a conflict. Additionally, he said, the BP accident was “clearly outside the coastal zone,” which is what SB469 deals with directly.
SB469, sponsored by Sen. Bret Allain, R-Franklin, and strongly pushed by Sen. Robert Adley, R-Benton, was one of almost 20 bills filed in this year’s legislative session seeking to derail the lawsuit by the levee authority and similar cases filed by Jefferson and Plaquemines parishes or to give the governor the ability to directly control the makeup of the flood protection authority’s board. None of the other measures made it through the legislative process.
Limits made retroactive
The new law puts limits, which it says are retroactive, on which government agencies can file suits for damage done by oil and gas companies. Some of that language in the bill could broadly be interpreted to apply to areas outside the coastal zone, according to opponents of the measure.
The bill’s primary target was the suit by the levee authority, which oversees flood protection systems on the east banks of Orleans, Jefferson and St. Bernard parishes. Lawyers for the authority, however, have argued that as written, the bill would impact the BP litigation but leave their suit intact.
That suit charges that oil and gas companies should pay to restore the wetlands destroyed or damaged by drilling, dredging and pipeline activities in southeast Louisiana over the last eight decades. It says that damage has led to massive erosion of coastal areas that otherwise would have served to reduce storm surge from tropical storms and hurricanes. Any money collected from the suit would go toward repairing that damage and paying the lawyers working the case.
The Jindal administration and the oil and gas industry have been fierce opponents of the suit.
Calls to veto SB469 began ramping up this week after a group of law professors released a memo — which had 80 signatories by Friday — arguing the language of the bill was so broad that BP could try to use it to kill suits stemming from the Deepwater Horizon spill. Caldwell asked Jindal to hold off on signing the bill while his office studied it; he eventually said he had determined there was a potential risk to those cases and the bill should be vetoed.
He was soon joined by local government officials, including Jefferson Parish President John Young and St. Bernard Parish President Dave Peralta — both leaders of heavily Republican parishes. The New Orleans City Council also urged Jindal to veto the bill in a resolution passed Thursday, and state Rep. Pat Connick, R-Marrero, sent the governor a request to veto the bill Friday morning.
Young, who lobbied successfully to keep the parish suits from being included in SB469, said that as written the bill could have “adverse impacts” on the parish’s suit against BP and potentially prevent parishes from suing for damage by oil companies in their coastal waters.
No motions filed
Neither BP nor any of the 96 other defendants in the flood protection authority’s suit had filed a motion to dismiss the flood authority’s suit based on SB469 as of Friday evening. But some officials said they expect to see both it and oil-spill cases challenged in the near future.
“It will, at the very least, cause delay while any uncertainty or legal dispute over what effect SB469 may or may not have,” said Young, one of several parish presidents who asked for the bill to be vetoed. “It will delay the prosecution and resolution of the case, delay the recovery of damages. It’s been four years (since the oil spill). The last thing we need at this point is any litigation based on the potential effect of SB469.”
Jindal’s news release said SB469 clarifies that only entities authorized under the Coastal Zone Management Act may bring litigation to assert claims arising out of state-permitted activities. These parties include parishes and the state. It further requires that dollars recovered through litigation must be spent on coastal restoration.
Jindal said in his statement: “This bill will help stop frivolous lawsuits and create a more fair and predictable legal environment, and I am proud to sign it into law. It further improves Louisiana’s legal environment by reducing unnecessary claims that burden businesses so that we can bring even more jobs to our state.”
Environmental groups accused Jindal of betraying Louisiana’s residents and letting oil and gas companies off the hook.
“This legislation is governance at its worst: poorly written, for the worst of reasons, with no public benefit and having potentially staggering unintended consequences,” said Steve Murchie of the Gulf Restoration Network, based in New Orleans. Jindal “has undermined the efforts of everyone working to restore coastal Louisiana. Not only has he refused to ask the oil and gas industry to live up to their legal obligations, or contribute to coastal restoration in any meaningful way, he has actively blocked others from simply enforcing the law.”
Russel Honoré, the retired U.S. Army general best known for bringing order to New Orleans after Hurricane Katrina, spent many hours in the State Capitol arguing against the legislation, using his celebrity to rally opponents and appearing on national television news programs like “The Rachel Maddow Show” on MSNBC.
“Who will pay to defend this law in court? Him or us the taxpayers?” Honoré said upon learning that Jindal had signed the law. “Don’t understand the governor’s passion for this law.”
‘A false controversy’
Business and industry groups, on the other hand, praised Jindal’s action.
Chris John, the former congressman who runs the Louisiana Mid-Continent Oil and Gas Association, which represents big oil companies, wrote to Jindal on Thursday that opponents of the legislation “are attempting to create a false controversy regarding the bill’s effect.”
John said suggestions that the measure would impact claims against BP were a red herring. “Sen. Allain could not have stated it more plainly: ‘It’s not our intent with this legislation to affect any claims by the parishes or the state against BP or anybody else.’ ”
As head of the Louisiana Association of Business and Industry, Stephen Waguespack — a former chief of staff for Jindal — lobbied for SB469 and other bills that would limit lawsuits against the oil and gas industry.
In a prepared statement, Waguespack said, “Throughout the legislative process, the attorneys pushing the lawsuit made it clear that they would stop at nothing to protect their contract — and we will continue to see those promised tactics play out in the media and court system in the days and weeks to come. While not unexpected, it is disappointing that opponents to SB469 failed to persuasively make these arguments throughout the process, and are instead choosing to do so now after the Legislature has passed the bill and the three-month session is complete.”
While the energy industry and other influential business groups, such as the Louisiana Association of Business and Industry, had all been supportive of the bill, there are indications BP was more aggressive than other oil and gas companies. Several lawmakers said they received emails from BP employees but not from those of other energy companies asking them to support SB469 and another measure dealing with lawsuits over pollution from oil exploration.
A second blow
In a second blow to the flood protection authority Friday, Jindal announced that Tim Doody, a St. Bernard Parish resident who has served on the authority since it was created, will be replaced by Tyrone Ben, a fellow St. Bernard resident who works for the Guidance Center, an outpatient behavioral health and counseling center. Doody is the fourth member of the authority who supported the suit to be replaced since the case was filed.
With Doody’s replacement, only five of the nine members of the board are on record in favor of continuing the suit. Two more members, one who supports the suit and one who opposes it, are expected to be up for renomination later this year.
Ben, who was urged to apply for a seat on the board by former St. Bernard Parish President Craig Taffaro, currently an official in Jindal’s administration, said he did not have a “political agenda” in applying for the seat.
Based on his experience working for oil and gas companies, Ben said, he is inclined to believe that because energy companies needed to receive permits for their work, they were already being regulated and the lawsuit was not necessary. However, he said he was willing to listen to those who disagree.
“I don’t know anything on the other side of the argument,” Ben said. “I would be open-minded. I would be willing to listen. Evidently they had something that compelled them to file it in the first place.”
Jindal officials have said opposition to the suit would be a “litmus test” for all new appointees to the authority, and Ben said he was asked about the case by Jindal administration officials prior to his appointment.
“I said if my selection was predicated on that, I might not be the best person for the job,” he said.
Because he was appointed after the session ended, Ben will not have to face Senate confirmation until next year’s session. Jindal’s other three appointees were all confirmed by the Senate this year.
‘Heartbreak for citizens’
Citizens for 1 Greater New Orleans founder Ruthie Frierson, whose organization is credited in large part for passage of the 2006 constitutional amendment creating independent, professional flood protection authorities for the east and west banks of the New Orleans area to replace the often overtly political levee boards that existed previously, said the decision to replace Doody was “heartbreak for all the citizens” of the area.
“You are a true example of being a hero,” Frierson wrote to Doody. “In spite of overwhelming adversity, you have spent every day and night since the storm working to rebuild, reform and renew the communities and people of Southeast Louisiana. On numerous occasions through these years, (former authority member) John Barry has said he knew of no one who deserved more praise and thanks for working tirelessly to protect and rebuild our Greater New Orleans area.”