POINTE A LA HACHE, La. — Oil giant Chevron must pay $744.6 million to restore damage caused to southeast Louisiana’s coastal wetlands, a jury decided Friday after a landmark trial more than a decade in the making.
The case was the first of dozens of pending lawsuits to reach trial in Louisiana against the world’s leading oil companies for their role in accelerating land loss along the state’s rapidly disappearing coast. The verdict, which Chevron says it will appeal, 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 affected by dredging of canals, drilling of wells and by billions of gallons of wastewater dumped into the marsh.
“No company is big enough to ignore the law, no company is big enough to walk away scot-free,” the plaintiff’s lead attorney, John Carmouche, told jurors during closing arguments.
A 1978 Louisiana coastal management law mandated that sites used by oil companies “be cleared, revegetated, detoxified, and otherwise restored as near as practicable to their original condition” after operations end. 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 plaintiffs testified. The company “chose 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 representing the plaintiffs.
Plaquemines Parish, the southeast Louisiana district that brought the lawsuit, had asked for $2.6 billion in damages.
Chevron’s lead trial attorney, Mike Phillips, said in a statement after the verdict that “Chevron is not the cause of the land loss occurring” in Plaquemines Parish and that the law does not apply to “conduct that occurred decades before the law was enacted.”
Phillips called the verdict “unjust” and said there were “numerous legal errors.”
Houston-headquartered Chevron reported more than $3 billion in earnings for the fourth quarter of 2024.
How are oil companies contributing to Louisiana’s 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.
Louisiana’s coastal parishes have lost more than 2,000 square miles of land over the last century, according to the U.S. Geological Survey, which has also identified oil and gas infrastructure as a significant cause. The state could lose an additional 3,000 square miles in the coming decades, its coastal protection agency has warned.
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 southern Louisiana — home to some of the nation’s biggest ports and key energy sector infrastructure — more vulnerable to flooding and destruction from extreme weather events such as 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 — a widely acknowledged cause of coastal erosion.
The way to solve the land loss problem is “not suing oil companies, it’s reconnecting the Mississippi River with the delta,” Phillips said during closing arguments.
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 last 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.
“Our communities are built on coast, our families raised on coast, our children go to school on coast,” Faircloth said. “The state of Louisiana will not surrender the coast. It’s for the good of the state that the coast be maintained.”
What does this mean for future litigation against oil companies?
Carmouche 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’s economy has long been heavily dependent on the oil and gas industry, which holds significant political power. Even so, Louisiana’s staunchly pro-industry Gov. Jeff Landry, a Republican, 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’s 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-ending settlement funds from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, and supporters of the litigation say payouts would provide a much-needed injection of funds.
Tommy Faucheux, president of the Louisiana Mid-Continent Oil and Gas Assn., said the verdict against Chevron “undermines Louisiana’s position as an energy leader” and “threatens our country’s trajectory to America-first energy dominance across the globe.” He warned that “businesses here are at risk of being sued retroactively tomorrow for following the laws of today.”
Attorneys for the parish said they hope the big payout will prompt more oil companies to come to the table to negotiate and channel more funding toward coastal restoration.
“Our energy is focused on securing appropriate verdicts and awards for every parish involved in these actions,” Carmouche said in a statement. “If 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.”
Brook writes for the Associated Press.
