Judge slashes Exxon’s landmark emissions fine

By Sean Reilly | 03/03/2021 01:36 PM EST

Exxon Mobil Corp.'s Baytown complex in Texas.

Exxon Mobil Corp.'s Baytown complex in Texas. Exxon Mobil

A federal judge has slashed a landmark fine against Exxon Mobil Corp. for air pollution violations at its Houston-area Baytown complex, but still levied what environmental groups said was a record Clean Air Act penalty.

Instead of the original total of almost $20 million, Exxon Mobil would pay $14.25 million under the ruling issued yesterday by Judge David Hittner of the Southern District of Texas.

Hittner was acting under orders from the 5th U.S. Circuit Court of Appeals, where a three-judge panel last summer threw out the original total and instructed Hittner to come up with a new figure based on the "traceability" between some permit violations and alleged harm to residents near the sprawling 3,400-acre refinery and petrochemical complex (Greenwire, July 30, 2020).


Hittner’s findings now go back to the 5th Circuit, which is expected to issue a new opinion, said David Nicholas, one of the attorneys representing Environment Texas and the Sierra Club, which had launched the citizen enforcement suit in 2010.

At Exxon Mobil, which asserted that the final fine should be no more than $1.365 million, "we are currently reviewing the decision and considering next steps," spokesman Todd Spitler said in an email.

In a news release, Luke Metzger, executive director of Environment Texas, urged the company to stop "its scorched-earth litigation tactics, pay its penalty and drop these endless appeals."

While the revised $14.25 million fine represents a 29% cut in the amount imposed by Hittner in 2017, it is still the largest penalty ever imposed in a Clean Air Act citizen suit, Josh Kratka, a senior attorney with the National Environmental Law Center who also represents the plaintiffs, said in the release.

Exxon Mobil had argued that the plaintiffs lacked the legal standing to contest most of the 16,400 days of air permit violations that occurred over an eight-year period at the Baytown complex, located about 25 miles outside Houston and home to the one of the nation’s largest refineries. Instead, the company had earlier said it was financially responsible for only 40 days of violations, warranting no more than a $1.5 million fine.

In last year’s opinion, 5th Circuit Judge Gregg Costa wrote that the two environmental groups had shown their members were harmed by the smoke, flares and foul-smelling emissions from the complex. But at the dispute’s crux was whether those injuries were traceable to the permit infractions.

Costa wrote on behalf of a three-judge panel in remanding the case to Hittner. Environment Texas and the Sierra Club subsequently argued they had evidence of more than 9,800 days’ worth of traceable permit violations. In yesterday’s ruling, however, Hittner put the total at 3,651.

In recalculating the fine, Hittner then started with some $14.2 million in economic benefits that Exxon Mobil had gained from delaying four pollution control projects, tacked on a 10% multiplier and subtracted about $1.4 million that Exxon Mobil had already paid.

The New Orleans-based 5th Circuit covers Louisiana, Texas and Mississippi. Because of the unusual number and magnitude of the violations at the Baytown complex, Nicholas did not foresee any ramifications for future Clean Air Act citizen suits from the 5th Circuit’s insistence on establishing traceabilty. And the case, he added, "reaffirmed bedrock principles of standing that have been applicable to environmental cases for a long time."