Transocean Can't Stall U.S. Spill Claims, Judge Says

Transocean Ltd. can’t use a 159- year-old law to stall claims by the U.S. or state governments over the Deepwater Horizon oil spill, a federal judge in Houston said.

Transocean asked U.S. District Judge Keith Ellison in May to limit its liability for damages caused by the spill in the Gulf of Mexico to the value of the rig’s unpaid drilling rental fees, about $27 million. Ellison ordered a stay on claims against Transocean, owner of the Deepwater Horizon, until after he ruled on the company’s cap request.

The stay doesn’t apply to claims by the U.S., state or tribal governments brought under the federal Oil Pollution Act or to U.S. claims under other federal environmental laws, Ellison said today.

The U.S. asked Ellison June 1 to rule the cap, stemming from the Limitation of Liability Act of 1851, didn’t apply to government claims. That law is pre-empted by the Oil Pollution Act of 1990, the U.S. said. Transocean last week agreed that the requested cap in the 1851 law wouldn’t apply to environmental losses by the U.S. and Gulf Coast states.

The case is In Re the Complaint and Petition of Triton Asset Leasing GmbH, Transocean Holdings LLC, 10-01721, U.S. District Court, Southern District of Texas (Houston).

To contact the reporters on this story: Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net. Laurel Brubaker Calkins in Houston at laurel@calkins.us.com;

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