Corporate crimes are becoming increasingly common as the public starts demanding more accountability for the harms perpetuated by companies. In California this week, after a four-month-long trial, a Santa Barbara County jury found a Texas company guilty of nine crimes for their role in the 2015 oil spill at Refugio Beach, the worst California oil spill in over two decades.
The spill ended up spreading oil across 4 miles of California coastline. Beaches were closed for months when 123,000 gallons of highly pressurized crude oil spilled onto beaches and into the sea when a 24-inch pipeline carrying oil offshore onto land ruptured. The jury found that the Houston-based oil company failed to properly maintain its pipeline. The jury also found the company guilty of eight misdemeanors, many of which dealt with the environmental damage the spill caused, such as killing mammals and harming protected seabirds.
Immediately after the oil spill, the company, Plains All-American Pipeline, paid for the clean-up efforts and apologized, but has consistently denied any wrongdoing. The clean-up cost around $335 million, not including lost revenues. The company released a statement emphasizing the fact that the jury did not find the company guilty of any ‘knowing misconduct,’ and continues to claim that the pipeline operations met or exceeded legal industry standards. Plains now faces a criminal fine on top of the costs for clean-up, although the exact amount will not be determined until a final sentencing hearing, scheduled for mid-December.
Plains accused state prosecutors of attempting to criminalize an unfortunate accident. But during the investigation, prosecutors found that Plains made multiple preventable errors which exacerbated the effects of the spill, including failing to detect the rupture and responding too slowly. Workers were found to have turned off the alarm that would have signaled a leak and restarted the line after it had automatically shut down. Plains claims it is still considering legal options and might file an appeal based on the felony charge issued by the jury. Plains had previously been indicted on 46 counts, including four felony charges, and 42 misdemeanor charges. Throughout the course of the litigation, the judge dismissed multiple claims.
Its legal woes are not limited to the state, though. It still faces fines from the U.S. government, as well as a federal class-action lawsuit by individuals who owned beachfront properties, commercial fishermen, other members of the oil and gas industry, and oil workers who lost their jobs as a direct result of the spill. The city of Santa Barbara has filed its own separate lawsuit seeking $2.1 million in compensation against the company, claiming that millions were lost in tax revenue due to the slump in tourists. And while the pipeline in question has been permanently shut down, Plains has re-applied for a pipeline replacement in almost the same position. State and city workers claim they will oppose the application, stating that it gives the company the opportunity to spill again. Plains has an uphill battle: currently, 69 percent of Californians oppose any new offshore drilling projects.
If the jury’s verdict is upheld, it could face over $1.5 million in fines, on top of the millions it has spent in clean-up and litigation fees.
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