In a huge win for environmental groups, a federal judge has ordered ExxonMobil to pay nearly $20 million for spewing millions of pounds of excess air pollution from its Houston-area industrial facilities.
The Sierra Club and Environment Texas sued the energy giant in 2010, alleging that over a five-year period it had emitted more than 8 million pounds of hazardous chemicals and other contaminants from its sprawling Baytown complex than is allowed by state and federal law and clean air permits. The 3,400-acre complex about 25 miles east of Houston houses a refinery and chemical, olefins and plastics plants.
U.S. District Judge David Hittner originally ruled in favor of ExxonMobil, finding in 2014 that only a tiny fraction of its emissions events were bad enough to warrant legal action — and handing down no penalties. But last May, the conservative-leaning 5th Circuit Court of Appeals vacated Hittner’s rulingand sent the case back to him “for assessment of penalties based on the correct number of actionable violations.”
On Wednesday, almost a year after the 5th Circuit decision, Hittner issued a judgment ordering the world’s largest oil company to pay $21.3 million, as well as plaintiffs’ attorneys fees. But he subtracted $1.4 million in fines the Texas Commission on Environmental Quality had already assessed against the company for such air emission events, bringing assessed penalties to $19.9 million.
In his 101-page ruling, Hittner also agreed with environmental groups that ExxonMobil had saved some $14.2 million by not complying with clean air act rules and regulations.
Luke Metzger, director of Environment Texas, said he believes the penalty is the “largest penalty resulting from a citizen suit in U.S. history.” Under the federal Clean Air Act, citizens are allowed to sue the federal government for violations of emissions standards or limitations.
“This ruling shows how crucial the citizen enforcement provision of the Clean Air Act really is for Texas residents,” Metzger said in a statement. “It means that private citizens victimized by the world’s biggest polluters can get justice in the American court system, even when government regulators look the other way.”
In an emailed statement, ExxonMobil said it disagreed with the court's decision and the award of any penalty and "will consider legal options including appeal of the court's decision."
"As the court expressed in its decision, ExxonMobil's full compliance history and good faith efforts to comply weigh against assessing any penalty," the statement said.
Environmental groups have filed several citizen suits against Texas energy companies in recent years for excess air pollution, pointing to what they describe as lax enforcement by state and federal environmental regulators. They have won multimillion-dollar settlements with several other energy giants like Shell and Chevron. ExxonMobil, however, decided to go to trial.
The favorable rulings against the energy companies call into question government policies that allow industrial facilities to claim that such excess emission events were unavoidable because of malfunctions or maintenance — known as "affirmative defense." Records show that state regulators accept those claims the vast majority of the time, rarely issuing fines or negotiating with companies to reduce them. At the ExxonMobil trial, an employee testified that the company almost always initially claims the affirmative defense even when it is not sure it meets all the requirements.