Exxon Gets Boost in Appeal Over MTBE Verdict

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By Steven M. Sellers

Feb. 23 — Exxon Mobil's effort to persuade the U.S. Supreme Court to review a state court $236 million ground water contamination verdict got a boost Feb. 22, when the Washington Legal Foundation filed an amicus brief arguing the state case was preempted by federal law.

The Washington, D.C.-based foundation amplified Exxon's arguments in a Supreme Court petition filed in January, contending the company was hamstrung by New Hampshire's claims that the company had a duty to avoid polluting the state's waters with methyl tertiary butyl ether—a now-banned gasoline additive. MTBE was the only feasible means to meet federal gasoline oxygenation mandates in the 1990s, and the state-law duty conflicted with that mandate, the foundation contends.

The state case amounts to “jackpot justice,” according to a Feb. 22 statement by WLF chief counsel Richard Samp.

“For 15 years, oil refiners added MTBE to their gasoline because federal environmental officials required them to do so,” Samp said. “Yet, because they obeyed federal law, these refiners now face billions of dollars in legal claims arising under state law.”

The New Hampshire court wrongly discounted the “factual impossibility” of complying with the state duty and the federal mandate, the WLF said. WLF supports policies in favor of business interests, according to its website.

WLF's preemption argument underscores a broader theme in Exxon's petition that may pique the court's interest. The company contends the “trial by formula” facilitated an “abstract, aggregate, statewide case” that denied its right to present an individualized defense, according to the petition.

New Hampshire relied on its role as protector of that state's waters to justify statistical approximations used to prove injury and damages in private and public water statewide, an approach that skirted Supreme Court cases on the proof required in class actions, Exxon claims.

New Hampshire's reply to the petition is due March 23, according to court records.

To contact the reporter on this story: Steven M. Sellers in Washington at ssellers@bna.com.

To contact the editor responsible for this story: Nicholas Datlowe at ndatlowe@bna.com.

For More Information

The amicus brief is available at http://src.bna.com/cNM.