New Jersey Governor Christie gives “appalling and disturbing” gift to Exxon after liability determined in trial (in exchange for what?): Settles $8.9 Billion damages lawsuit for $250 Million

 Christie’s Office Drove Exxon Settlement, Ex-Official Says by Benjamin Weiser, March 4, 2015, The New York Times
For more than a decade, the New Jersey attorney general’s office conducted a hard-fought legal battle to hold Exxon Mobil Corporation responsible for decades of environmental contamination in northern New Jersey.

But when the news came that the state had reached a deal to settle its $8.9 billion claim for about $250 million, the driving force behind the settlement was not the attorney general’s office — it was Gov. Chris Christie’s chief counsel, Christopher S. Porrino, two people familiar with the negotiations said. One of those people, Bradley M. Campbell, was the commissioner of New Jersey’s Department of Environmental Protection in 2004 when the lawsuits against Exxon were filed. Mr. Campbell, in an Op-Ed article appearing in The New York Times on Thursday, wrote that “even more troubling” than the decision to settle the lawsuit were “the circumstances surrounding the decision.”

He goes on to say that former colleagues of his in the state government told him that Mr. Porrino “inserted himself into the case, elbowed aside the attorney general and career employees who had developed and prosecuted the litigation, and cut the deal favorable to Exxon.”

The settlement, first reported by The Times on Friday, came two months after the attorney general’s office, in a court brief, argued vigorously for $8.9 billion in damages, saying, “The scope of the environmental damage resulting from the discharges is as obvious as it is staggering and unprecedented in New Jersey.”

The state, which litigated the case through the administrations of four governors, based its damages claim on what it said was contamination and loss of use of more than 1,500 acres of wetlands, marshes and meadows in northern New Jersey, at two refinery sites, in Bayonne and Linden (known as Bayway).

Exxon, in its brief, said that the state’s arguments “ignore the evidence, science and the law,” and claimed that no damages should be awarded. Spokesmen for Mr. Porrino and Exxon declined to comment on Wednesday. … The other person who described Mr. Porrino’s role spoke on the condition of anonymity because the deal was not yet public.

The settlement has drawn broad criticism from environmental advocates and state lawmakers.

Vincent Prieto, the New Jersey Assembly speaker, and John F. McKeon, chairman of the Assembly’s Judiciary Committee, both Democrats, said on Wednesday that they planned to hold a hearing on the deal on March 19.

“The reported settlement is appalling and disturbing,” Mr. McKeon said. “The Christie administration appears more interested in rewarding Exxon Mobil — for whatever reason [Kick back?] — than protecting taxpayers and our environment.”

And Stephen M. Sweeney, the State Senate president, and Senator Raymond J. Lesniak, also Democrats, said on Tuesday that the Senate would seek to intervene in the lawsuit and try to block the deal from being approved.

Much of the criticism has focused on the lack of a public rationale for why the state would choose to settle a lawsuit that it had invested so much effort and time in trying to win; environmentalists fear that Mr. Christie, a Republican, wants to use the money for other budgetary needs. Indeed, a state appropriations law, proposed by Mr. Christie last year, says that any funds beyond the first $50 million collected in damages or other environmental recoveries shall go to the state’s general fund. When state lawmakers tried to amend the proposal to steer more money back toward environmental restoration, Mr. Christie vetoed the effort.

The settlement and the closing briefs followed a 2014 trial that lasted over eight months in which liability was no longer an issue, and a judge was to decide how much Exxon should pay in damages. The judge, Michael J. Hogan, was believed to be ready to rule when a deputy state attorney general, Richard F. Engel, emailed the judge and asked for a delay, citing the settlement talks.

Mr. Porrino, who has been the governor’s chief counsel since January 2014, had previously served for two years as director of the Division of Law in the attorney general’s office, placing him in an oversight position over the Exxon litigation.

Mr. Campbell led New Jersey’s environmental agency from 2002 to 2006. Earlier, he served as a lawyer in the Justice Department, then as an associate director of the White House Council on Environmental Quality under President Bill Clinton. Later he was the regional administrator of the Environmental Protection Agency’s mid-Atlantic region. Mr. Campbell said he would not comment beyond his Op-Ed article.

The deal was to be submitted for public comment in April and then to Judge Hogan for approval in May, “unless comments received during the public notice and comment period necessitate a change,” Mr. Engel said in his letter last month.

In the Op-Ed piece, Mr. Campbell calls the decision to settle for “roughly three cents on the dollar” after years of litigation an “embarrassment to law enforcement and good government.” [Emphasis added]

ExxonMobil settlement must be blocked by Ahbury Park Press, March 2, 2015
What makes the news of the settlement even more disturbing is that the liability in the case had already been determined at trial. The only matter to be determined was the amount of the damages. And last month, when a state Superior Court judge was believed close to rendering a decision on the damages, the Christie administration twice petitioned the court to hold off because settlement negotiations were under way, according to the Times.

Why, you might ask, would a settlement be pursued before a judge had rendered a decision on an amount that most believe would have been far higher than the sum agreed to in the settlement?

Two theories have been advanced. The first is that the money could be used to help offset the state’s budget deficit — the classic one-time fix Christie has often railed against. A provision of this year’s budget allows the state to divert anything above $50 million from natural resources damage suits to the general fund. In other words, not only would New Jersey be getting only pennies on the dollar from the settlement, but potentially none of the money would be used to repair the environmental damage.

Another theory is that this is just one more example of how Christie’s decisions and actions pertaining to New Jersey issues are determined first and foremmost by how he thinks they will play with conservative Republicans nationally and by major corporate and individual donors, including the Koch brothers and other wealthy oil and gas industry contributors. You don’t have to be a conspiracy theorist to give credence to either of those scenarios.

Fortunately, the settlement is subject to approval by the state Department of Environmental Protection, which is required to take public input into account during a 30-day comment period once the agreement is published April 6. The agreement then will be subject to final approval by the court.

Strong opposition to the agreement by some state lawmakers can be expected. State Sen. Ray Lesniak, D-Union, already has expressed his indignation at the settlement. He says he will pursue every opportunity to challenge it, including an appeal of the decision to a higher court. [Emphasis added]

A Christie giveaway to corporate polluter? by Bob Jordan, February 27, 2015, Ashbury Park Press
The parties have not announced the deal publicly and it still must be approved by a judge, according to the New York Times, which reported the settlement Friday and said New Jersey will receive around $250 million.

However, the proposed settlement still is also subject to a public process. The notice of the consent judgment is scheduled to be published April 6 and there will be a 30-day public comment period that the state Department of Environmental Protection must consider.

If the DEP signs off, the consent agreement then goes to a judge for approval.

Jeff Tittel, head of the state chapter of the Sierra Club, said the proposed settlement represents “pennies on the dollar.”

“All along the judges were ruling in favor of New Jersey. The administration had no reason to settle, other than balancing the budget and giving away the store to Exxon at the expense of New Jersey’s environment,” Tittel said.

Christie this week proposed a budget for the fiscal year that begins July 1 that is balanced but does not take into account a $1.6 billion pension payment a state Superior Court judge recently said is due. The state plans to appeal the payment ruling.

Christie, a potential but undeclared candidate for president, is in California Friday and Saturday on a political trip. …

A Democratic lawmaker, Assemblywoman Annette Quijano of Union County, in a statement said it is “confounding as to why the state would settle for such a low figure after all the time and resources spent litigating this case over a decade and with the judge expected to rule soon.”

“Residents in my district and the surrounding areas have seen their quality of life altered by damage that will likely never be undone,” Quijano said. “This settlement figure does not even come close to restoring these lands to their natural state.” [Emphasis added]

Exxon Settles $9 Billion Pollution Case in New Jersey for Far Less by Benjamin Weiser, Alain Delaquérière contributed research, February 27, 2015, The New York Times
A long-fought legal battle to recover $8.9 billion in damages from Exxon Mobil Corporation for the contamination and loss of use of more than 1,500 acres of wetlands, marshes, meadows and waters in northern New Jersey has been quietly settled by the state for around $250 million.

The lawsuits, filed by the State Department of Environmental Protection in 2004, had been litigated by the administrations of four New Jersey governors, finally advancing last year to trial. By then, Exxon’s liability was no longer in dispute; the only issue was how much it would pay in damages.

The stakes were high, given the enormous cost the state’s experts had placed on restoring and replacing the resources damaged by decades of oil refining and other petrochemical operations, as well as of the public’s loss of use of the land. “The scope of the environmental damage resulting from the discharges is as obvious as it is staggering and unprecedented in New Jersey,” the administration of Gov. Chris Christie said in a court brief filed in November.

But a month ago, with a State Superior Court judge believed to be close to a decision on damages, the Christie administration twice petitioned the court to hold off on a ruling because settlement talks were underway. Then, last Friday, the state told the judge that the case had been resolved.

The parties have not announced the deal publicly, and it still must be approved by the judge. But some legal and environmental experts who were told about the agreement asked why New Jersey would suddenly settle a case that it had fought strenuously for more than a decade.

Richard B. Stewart, a New York University law professor and a former head of the Justice Department’s environmental division under President George Bush, noted the “striking disparity between the damages claimed, which have been exhaustively litigated, and the settlement amount,” particularly with a judicial ruling expected soon. Mr. Stewart said that it was hard to assess the agreement without knowing the evidence, but that “it raises questions.”

The documents that made reference to the settlement, which had not been filed publicly, were obtained after a request by The New York Times. They do not reveal the settlement amount; the figure was provided by two people who were told about it, and who spoke on the condition of anonymity because the deal was not yet public.

Debbie Mans, the executive director of the New York/New Jersey Baykeeper, characterized the proposed deal as “a travesty” and called on the judge to “reject the settlement outright.”

The deal comes at a time when Mr. Christie, a potential contender for the Republican presidential nomination in 2016, is experiencing the lowest approval ratings of his tenure, and has been forced to defend his decision to reduce state pension payments.

The damage to the Bayonne and Linden (known as Bayway) sites dated back many years. “Contamination of the land and water at the Bayway and Bayonne refineries began as early as the 1870s in Bayonne and the early 1900s in Bayway and continues to this day,” the state’s expert report says.

“Today, many of these dredge fill areas still look and smell like petroleum waste dumps,” the report continues. “Spilled materials from pipeline ruptures, tank failures or overflows, and explosions have resulted in widespread groundwater, soil and sediment contamination.”

The attorney general’s office said in its brief in November that the sites had been “adversely affected by or buried under the discharge of hazardous substances,” including over 600 identified chemicals.

On the Bayway site, a 2007 court opinion noted, marshland adjacent to a creek was “now mostly covered with a tar of petroleum products or filled with other hazardous constituents and debris.” Another 45 acres comprised “sludge lagoons,” onetime tidal marshes used as hazardous waste disposal facilities.

It’s painfully clear that Mr. Christie does not represent the interests of NJ residents.

The state had set the cost of primary restoration of the sites at $2.6 billion; the state also sought $6.3 billion for what it described as compensatory or “loss of use” damages, intended “to make the public whole.”

The damages trial, held before Judge Michael J. Hogan in Mount Holly, N.J., lasted from January through September 2014. The judge was to rule once the closing briefs were filed in November.

Exxon had vigorously contested the lawsuit, and in its brief after the trial said that it had long ago taken responsibility for cleaning up the contamination; that there were “fully functioning” marshes, forests and wildlife on the sites; and that, because they had been closed to the public for years, the state was seeking a windfall “for something the public never lost.” Exxon argued that the state’s arguments “ignore the evidence, science and the law” and that no damages should be awarded.

It was unclear when the settlement talks began. A deputy state attorney general, Richard F. Engel, emailed Judge Hogan on Jan. 29, saying the parties were engaged in “serious settlement negotiations” and asking him to “defer the issuance of a decision in this matter.”

Two weeks later, Mr. Engel again wrote to the judge, saying “a few critical points” still needed to be resolved and asking that he delay his decision until Feb. 20.

By then, Mr. Engel added, “we are confident that we will have an agreement or our efforts to settle will have ended.”

Then last Friday, Mr. Engel wrote to Judge Hogan, saying the parties had reached a settlement “which is memorialized in a final, agreed upon, consent judgment.”

Mr. Engel said the agreement would be submitted for public comment in April and would then be submitted for court approval in May, “unless comments received during the public notice and comment period necessitate a change.” If the settlement is approved, Judge Hogan will presumably not release his opinion, and whatever damages he would have set will not be made public. [Emphasis added]

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