Swamp Thing: Lawsuit Blaming Oil Companies For Wetland Loss Might As Well Blame The Plaintiffs

07 30, 2013 by Forbes

The multibillion-dollar lawsuit that Louisiana plaintiff lawyers launched against the oil industry last week is based upon a compelling theory: In their century-long quest for oil and gas, drillers helped destroy the state’s protective wetlands by digging a network of canals that introduced “corrosive salt water” into the delicate ecosystem.

The 24-page lawsuit on behalf of several local levee boards names a laundry list of oil companies that have done business in Louisiana, from Alta Mesa Services to Yuma Exploration, including majors like BP BP -3.2%, Chevron CVX -0.31% and ExxonMobil. It blames them for causing erosion and loss of plant life that is causing the wetlands to shrink at a rate of more than 30 square miles a year.

There’s a few problems here: First, the Louisiana Supreme Court appears to have ruled out such claims in a 2005 decision. Second, lawyers tried the same arguments when they sued the Army Corps of Engineers for Hurricane Katrina damages to New Orleans, and got poured out of court. Finally, global warming and flood-control levees themselves probably have more to do with Louisiana’s shrinking coastline than anything the oil companies have done.

“This is just the latest chapter in the Louisiana entitlements saga,” said Ed Richards, a professor of public-health law at the Louisiana State University Law Center and expert on flood-related litigation. “A lot of the bad science that was developed for the Katrina levee cases is being recycled here.”

Richards is no right-wing climate-science denier. His concern is lawsuits like this distract Louisiana residents from the fact that the state’s wetlands are doomed to disappear into the Gulf of Mexico for other reasons, and the remediation measures the levee boards want the oil companies to pay for might only accelerate the process.

Some scientific background: Southern Louisiana and the City of New Orleans sit on a vast delta which, like the rest of the world’s great river deltas, is surprisingly young. The land formed 8,000 to 10,000 years ago when the Mississippi River was flush with runoff from retreating glaciers and the Gulf of Mexico sea level was hundreds of feet lower than it is today. A long period of relatively stable and rising temperatures, accompanied by rising sea levels, caused the sediment in the Mississippi to pile up where it entered the Gulf.

When the delta first started forming, Richards told me, “the Louisiana coastline was probably halfway to Cuba.”

As the sediments piled up and sea levels rose, several things happened. The river’s velocity slowed down and the weight of the sediments pushed the surface down in the process known as subsidence. Subsidence can be accelerated by industrial processes such as pumping groundwater out of sandy aquifers, although it is unlikely that simply pumping oil out of rock thousands of feet below the surface has much of an effect. Richards’ late colleague, the LSU geologist Roy Dokka, showed that there has been significant subsidence — more than two feet in the New Orleans area since 1955 — even in areas with no oil drilling.

By the 19th century loggers got into the act, clear-cutting the cypress forests that once dominated the landscape south of New Orleans and digging canals to haul the valuable lumber out. Richards said the star-shaped pattern of the lumber canals can still be seen in aerial photos, overlaid by the straight canals oil drillers started digging in the early 1900s. What had been forest subject to flooding several times a year quickly became wetlands as the cypress trees were removed, he said.

“What you see with the Louisiana coast is pretty much all invasive species subsequent to the cypress,” Richards said. “The oil companies didn’t start this process, and they didn’t cut the big trees.”

In the lawsuit, the levee boards blame the oil companies for destroying the wetlands and increasing the financial burden on them to protect residents from floods:

"These activities have changed not only the topography of the coastal lands, but the location, flow and natural pulsing patterns of the waters moving through those lands, and the process of sediment deposition that naturally renourishes them. The result has been to accelerate land loss and leave much of those coastal lands that remain in a diminished and vulnerable state."

But that same charge could be made against the government, for constructing hundreds of miles of levees that keep the Mississippi within its banks and prevent the flooding that used to dump sediment across thousands of square miles of low-lying delta land.

In addition to scientific objections, there’s a big legal barrier in the way of this lawsuit. The Louisiana Supreme Court, in a 2005 decision called Terrebonne Parish v. Castex, rejected a lawsuit by a local school board trying to force an oil company to restore marshlands it owned to their original state. The school board, like the levee boards, argued drillers cut canals that destroyed vegetation and caused the land to flood. But nothing in the drilling lease provided for such remediation, the court held, and the court declined “to order piecemeal restoration of the coast in some fashion” instead of leaving that to legislators and environmental experts.

The lawsuit by the levee boards relies on Louisiana state law, including Civil Code 656, which protects the “natural servitude of drain.” But the state Supreme Court considered similar state laws in the Terrebonne case and rejected them in favor of a simple analysis of the leases oil companies signed in order to drill.

The whole lawsuit, Richards told me, might be an effort to answer the “political question about whether the majority on the Louisiana Supreme Court has changed.” Terrebonne was decided 4-3 and Chief Justice Pascal Calogero, who wrote the opinion, has since retired.

The levee boards, like Terrebonne Parish, want the oil companies to pay for billions of dollars worth of projects designed to halt the erosion of the Louisiana coast. But Richards is skeptical they’d help, and in some case they might actually make things worse. Most of the canals were cut by pushing mud into banks called spoils on either side. Those have since become home to trees and wildlife that would lose their habitats if they were bulldozed back into the canals.

The last time disaster struck New Orleans, plaintiff lawyers organized thousands of homeowners to sue the Army Corps of Engineers, claiming its negligence caused the levees to collapse and flood the city. A federal judge allowed those lawsuits to proceed, even granting class-action status in defiance of prohibitions in the Federal Tort Claims Act. The Fifth Circuit in New Orleans first ruled for the plaintiffs as well, then reconsidered, deciding that the 1927 Flood Control Act gave the government absolute immunity from suits over flooding damage.

This being Louisiana, and the defendants being corporations instead of the government, this case might also survive a trial judge’s scrutiny. But the plaintiffs will have a tough time getting around Terrebonne Parish, unless the Louisiana Supreme Court has changed its views on contract law. And even if they win, it’s unlikely the billions of dollars they get from the oil companies will halt the steady erosion of Louisiana’s coastline.

“It’s an absolutely fascinating confluence of environmentalists and state people denying the reality of ocean rise, climate change and science,” Richards says of he lawsuit. Down in Louisiana, he adds, “we’re all about other people’s money.”