April 9, 2013

Jury awards N.H. $236 million from Exxon

The state sued the oil company over MTBE, a toxic chemical additive used by Exxon Mobil.

The Associated Press

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The U.S. Environmental Protection Agency has classified MTBE as a "possible human carcinogen." New Hampshire banned its use in 2007.

The state says more than 600 wells in New Hampshire are known to be contaminated with MTBE and an expert witness estimated the number could exceed 5,000.

Irving, Texas-based Exxon Mobil was the sole remaining defendant of the 26 the state sued in 2003. Citgo was a co-defendant when the trial began in January, but it began settlement negotiations with the state and withdrew from the trial. Citgo ultimately settled for $16 million, bringing the total the state has collected in MTBE settlement money to $136 million.

Fadel Gheit, managing director of oil and gas research and a senior analyst at Oppenheimer & Co., said the verdict won't put a dent in Exxon Mobil's bottom line.

"Exxon will probably make close to a $40 billion profit this year, Gheit said. "That's (the award) two days' work."

He said it's no surprise that Exxon Mobil would take the 10-year-old lawsuit to trial, saying the company "will make you sweat for every dollar you think you're going to get." Company leaders view it as a matter of principle, he said.

"Exxon is the only company I know of that will fight to the last minute," Gheit said. "I understand their mentality. Everybody thinks they can milk this cow."

The trial was the longest state trial in New Hampshire history and the verdict the largest jury verdict in state history, eclipsing the $21.6 million awarded in 2010 in a drug products liability case.

Jurors had more than 400 exhibits to sift through, including memos and reports dating back decades. Those memos included some dating back to 1984 in which Exxon Mobil researchers warned against using MTBE gasoline because of the extensive harm it can do to groundwater.

Grant, the attorney representing the state, said it was pleased the jury held Exxon Mobil accountable for widespread groundwater contamination.

"The finding of Exxon's negligence is particularly important because it shows the jury understood that this problem could have been avoided," she said.

Attorney Matt Pawa of the Pawa Law Group in Boston, who has been involved in the case from the start and brought in the Sher Leff firm, said perserverence paid off.

"When you seek justice against one of the world's biggest corporations, you have to stick it out for the long haul."

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