POINTE 脌 LA HACHE, La. (AP) 鈥� Oil company Chevron must pay $744.6 million to restore damage it caused to southeast Louisiana's coastal wetlands, a jury ruled on Friday following a landmark trial more than a decade in the making.
The case was the first of to reach trial in Louisiana against the world鈥檚 leading oil companies for their role in accelerating land loss along the state鈥檚 coast. The verdict 鈥� which Chevron says it will appeal 鈥� could set a precedent leaving other oil and gas firms on the hook for billions of dollars in damages tied to land loss and environmental degradation.
What did Chevron do wrong?
Jurors found that energy giant Texaco, acquired by Chevron in 2001, had for decades violated Louisiana regulations governing coastal resources by failing to restore wetlands impacted by dredging canals, drilling wells and billions of gallons of wastewater dumped into the marsh.
鈥淣o company is big enough to ignore the law, no company is big enough to walk away scot-free,鈥� the plaintiff鈥檚 lead attorney John Carmouche told jurors during closing arguments.
A 1978 Louisiana coastal management law mandated that sites used by oil companies 鈥渂e cleared, revegetated, detoxified, and otherwise restored as near as practicable to their original condition鈥� after operations ended. Older operations sites that continued to be used were not exempt and companies were required to apply for permits.
But the oil company did not obtain proper permits and failed to clean up its mess, leading to contamination from wastewater stored unsafely or dumped directly into the marsh, the lawsuit said.
The company also failed to follow known best practices for decades since it began operating in the area in the 1940s, expert witnesses for the plaintiff鈥檚 testified. The company 鈥渃hose profits over the marsh" and allowed the environmental degradation caused by its operations to fester and spread, Carmouche said.
The jury awarded $575 million to compensate for land loss, $161 million to compensate for contamination and $8.6 million for abandoned equipment. The amount earmarked for restoration exceeds $1.1 billion when including interest, according to attorneys for Talbot, Carmouche & Marcello, the firm behind the lawsuit.
Plaquemines Parish, the southeast Louisiana district which brought the lawsuit, had asked for $2.6 billion in damages.
Chevron's lead trial attorney Mike Phillips said in a statement following the verdict that 鈥淐hevron is not the cause of the land loss occurring鈥� in Plaquemines Parish and that the law does not apply to 鈥渃onduct that occurred decades before the law was enacted.鈥�
Phillips called the ruling 鈥渦njust鈥� and said there were 鈥渘umerous legal errors.鈥�
Houston-headquartered Chevron more than $3 billion in earnings for the fourth quarter of 2024.
How are oil companies contributing to Louisiana鈥檚 land loss?
The lawsuit against Chevron was filed in 2013 by Plaquemines Parish, a rural district in Louisiana straddling the final leg of the Mississippi River heading into the Gulf of Mexico, also referred to as the Gulf of America as declared by President Donald Trump.
Louisiana鈥檚 coastal parishes have lost more than 2,000 square miles (5,180 square kilometers) of land over the past century, according to the , which has also identified oil and gas infrastructure as a significant cause. The state could lose another 3,000 square miles (7,770 square kilometers) in the coming decades, its coastal protection agency has .
Thousands of miles of canals cut through the wetlands by oil companies weakens them and exacerbates the impacts of sea level rise. Industrial wastewater from oil production degrades the surrounding soil and vegetation. The torn up wetlands leave South Louisiana 鈥� home to some of the nation鈥檚 biggest ports and key energy sector infrastructure -- more vulnerable to flooding and destruction from extreme weather events like hurricanes.
Phillips, Chevron's attorney, said the company had operated lawfully and blamed land loss in Louisiana on other factors, namely the extensive levee system that blocks the Mississippi River from depositing land regenerating sediment 鈥� a widely acknowledged .
The way to solve the land loss problem is 鈥渘ot suing oil companies, it鈥檚 reconnecting the Mississippi River with the delta,鈥� Phillips said during closing arguments.
Yet the lawsuit held the company responsible for exacerbating and accelerating land loss in Louisiana, rather than being its sole cause.
Chevron also challenged the costly wetlands restoration project proposed by the parish, which involved removing large amounts of contaminated soil and filling in the swaths fragmented wetlands eroded over the past century. The company said the plan was impractical and designed to inflate the damages rather than lead to real world implementation.
Attorney Jimmy Faircloth, Jr., who represented the state of Louisiana, which has backed Plaquemines and other local governments in their lawsuits against oil companies, told jurors from the parish that Chevron was telling them their community was not worth preserving.
鈥淥ur communities are built on coast, our families raised on coast, our children go to school on coast,鈥� Faircloth said. 鈥淭he state of Louisiana will not surrender the coast, it鈥檚 for the good of the state that the coast be maintained.鈥�
What does this mean for future litigation against oil companies?
Carmouche, a well-connected attorney, and his firm have been responsible for bringing many of the lawsuits against oil companies in the state. Industry groups have accused the firm of seeking big paydays, not coastal restoration.
Louisiana鈥檚 economy has long been heavily dependent on the oil and gas industry and the industry holds significant political power. Even so, Louisiana鈥檚 staunchly pro-industry Gov. Jeff Landry has supported the lawsuits, including bringing the state on board during his tenure as Attorney General.
Oil companies have fought tooth and nail to quash the litigation, including unsuccessfully lobbying Louisiana鈥檚 Legislature to pass a law to invalidate the claims. Chevron and other firms also repeatedly tried to move the lawsuits into federal court where they believed they would find a more sympathetic audience.
But the heavy price Chevron is set to pay could hasten other firms to seek settlements in the dozens of other lawsuits across Louisiana. Plaquemines alone has 20 other cases pending against oil companies.
The state is running out of money to support its ambitious coastal restoration plans, which have been fueled by soon-expiring settlement funds from the , and supporters of the litigation say payouts could provide a much-needed injection of funds.
Tommy Faucheux, president of the Louisiana Mid-Continent Oil & Gas Association, said the verdict against Chevron 鈥渦ndermines Louisiana鈥檚 position as an energy leader鈥� and 鈥渢hreatens our country鈥檚 trajectory to America-first energy dominance across the globe.鈥� He warned that 鈥渂usinesses here are at risk of being sued retroactively tomorrow for following the laws of today.鈥�
Attorneys for the parish said they hope that big payout will prompt more oil companies to come to the table to negotiate and channel more funding towards coastal restoration.
鈥淥ur energy is focused on securing appropriate verdicts and awards for every parish involved in these actions,鈥� Carmouche said in a statement. 鈥淚f we continue to be successful in our efforts, these parishes, and Louisiana, will have sent a clear message that Louisiana's future must be built around a new balance between our energy industry and environmental necessities."
Jack Brook, The Associated Press
