48:3 Deepwater Horizon: Rethinking OPA’s Liability Limitations in the Wake of Environmental Disaster

Comment

Abstract

After the explosion of Deepwater Horizon in the Gulf of Mexico in April 2010, Congress considered legislation aimed at increasing the liability limits placed on companies responsible for oil spills. Particularly at issue was a provision of the Oil Pollution Act of 1990 that places a $75 million legal limit on a company’s liability for economic damages as a result of an oil spill.

This Comment reviews the relevant provisions of the Oil Pollution Act of 1990 and discusses the legislative proposals considered by Congress. It argues that eliminating the cap on damages, even retroactively, would have little or no impact on the amount of recovery achieved by injured parties claiming relief from the disaster. Should Congress pursue such action, it could seriously jeopardize the current structure of the oil drilling and production industry by arbitrarily imposing additional costs on operators. It concludes by proposing that action by Congress be measured, reasoned, and deliberate, focusing on active and ongoing regulation, rather than knee-jerk legislation, as a response to short-term public outcry.