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56–642 PDF 2010

LEGAL LIABILITY ISSUES SURROUNDING THE 

GULF COAST OIL DISASTER 

HEARING 

BEFORE THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

MAY 27, 2010 

Serial No. 111–130 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 

(II) 

COMMITTEE ON THE JUDICIARY 

JOHN CONYERS, JR., Michigan, Chairman 

HOWARD L. BERMAN, California 

RICK BOUCHER, Virginia 

JERROLD NADLER, New York 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

WILLIAM D. DELAHUNT, Massachusetts 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO PIERLUISI, Puerto Rico 

MIKE QUIGLEY, Illinois 

JUDY CHU, California 

TED DEUTCH, Florida 

LUIS V. GUTIERREZ, Illinois 

TAMMY BALDWIN, Wisconsin 

CHARLES A. GONZALEZ, Texas 

ANTHONY D. WEINER, New York 

ADAM B. SCHIFF, California 

LINDA T. SA ́ NCHEZ, California 

DANIEL MAFFEI, New York 

JARED POLIS, Colorado 

LAMAR SMITH, Texas 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

DANIEL E. LUNGREN, California 

DARRELL E. ISSA, California 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TOM ROONEY, Florida 

GREGG HARPER, Mississippi 

PERRY APELBAUM, Majority Staff Director and Chief Counsel 

SEAN MCLAUGHLIN, Minority Chief of Staff and General Counsel 

(III) 

C O N T E N T S 

MAY 27, 2010 

Page 

OPENING STATEMENTS 

The Honorable John Conyers, Jr., a Representative in Congress from the 

State of Michigan, and Chairman, Committee on the Judiciary ..................... 1 

The Honorable Lamar Smith, a Representative in Congress from the State 

of Texas, and Ranking Member, Committee on the Judiciary ......................... 8 

The Honorable Jerrold Nadler, a Representative in Congress from the State 

of New York, and Member, Committee on the Judiciary ................................. 10 

The Honorable Howard Coble, a Representative in Congress from the State 

of North Carolina, and Member, Committee on the Judiciary ......................... 10 

The Honorable Robert C. ‘‘Bobby’’ Scott, a Representative in Congress from 

the State of Virginia, and Member, Committee on the Judiciary .................... 10 

The Honorable Darrell Issa, a Representative in Congress from the State 

of California, and Member, Committee on the Judiciary ................................. 11 

The Honorable Steve Cohen, a Representative in Congress from the State 

of Tennessee, and Member, Committee on the Judiciary ................................. 12 

The Honorable Sheila Jackson Lee, a Representative in Congress from the 

State of Texas, and Member, Committee on the Judiciary .............................. 16 

The Honorable Maxine Waters, a Representative in Congress from the State 

of California, and Member, Committee on the Judiciary ................................. 16 

The Honorable Henry C. ‘‘Hank’’ Johnson, Jr., a Representative in Congress 

from the State of Georgia, and Member, Committee on the Judiciary ............ 17 

The Honorable William D. Delahunt, a Representative in Congress from 

the State of Massachusetts, and Member, Committee on the Judiciary ......... 18 

The Honorable Mike Quigley, a Representative in Congress from the State 

of Illinois, and Member, Committee on the Judiciary ....................................... 19 

WITNESSES 

Mr. Keith D. Jones, Baton Rouge, LA 

Oral Testimony ..................................................................................................... 23 

Prepared Statement ............................................................................................. 26 

Mr. Douglas Harold Brown, Employee, Transocean, Ltd., Vancouver, WA 

Oral Testimony ..................................................................................................... 33 

Prepared Statement ............................................................................................. 35 

Mr. Stephen Lane Stone, Employee, Transocean, Ltd., Katy, TX 

Oral Testimony ..................................................................................................... 41 

Prepared Statement ............................................................................................. 44 

Mr. Byron Encalade, President, Louisiana Oysters Association 

Oral Testimony ..................................................................................................... 47 

Prepared Statement ............................................................................................. 49 

The Honorable Jim Hood, Attorney General, State of Mississippi 

Oral Testimony ..................................................................................................... 52 

Prepared Statement ............................................................................................. 54 

Mr. Daryl Willis, Vice President, Resources, BP America 

Oral Testimony ..................................................................................................... 85 

Prepared Statement ............................................................................................. 87 

Ms. Rachel G. Clingman, Acting General Counsel, Transocean, LTD. 

Oral Testimony ..................................................................................................... 93 

Prepared Statement ............................................................................................. 96 

Page

IV 

Mr. James W. Ferguson, Senior Vice President and Deputy General Counsel, 

Halliburton 

Oral Testimony ..................................................................................................... 100 

Prepared Statement ............................................................................................. 102 

Mr. William C. Lemmer, Senior Vice President and General Counsel, Cameron International Corporation 

Oral Testimony ..................................................................................................... 108 

Prepared Statement ............................................................................................. 109 

Mr. Vincent J. Foley, Partner, Holland & Knight, LLP 

Oral Testimony ..................................................................................................... 111 

Prepared Statement ............................................................................................. 114 

Mr. Thomas C. Galligan, President and Professor, Colby-Sawyer College 

Oral Testimony ..................................................................................................... 120 

Prepared Statement ............................................................................................. 122 

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Prepared Statement of the Honorable John Conyers, Jr., a Representative 

in Congress from the State of Michigan, and Chairman, Committee on 

the Judiciary ......................................................................................................... 2 

Prepared Statement of the Honorable Steve Cohen, a Representative in Congress from the State of Tennessee, and Member, Committee on the Judiciary ......................................................................................................................... 13

Prepared Statement of the Honorable Mike Quigley, a Representative in 

Congress from the State of Illinois, and Member, Committee on the Judiciary ......................................................................................................................... 20

Material submitted by the Honorable John Conyers, Jr., a Representative 

in Congress from the State of Michigan, and Chairman, Committee on 

the Judiciary ......................................................................................................... 180 

Material submitted by the Honorable John Conyers, Jr., a Representative 

in Congress from the State of Michigan, and Chairman, Committee on 

the Judiciary ......................................................................................................... 182 

APPENDIX 

Material Submitted for the Hearing Record .......................................................... 189 

(1) 

LEGAL LIABILITY ISSUES SURROUNDING THE 

GULF COAST OIL DISASTER 

THURSDAY, MAY 27, 2010 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Committee met, pursuant to notice, at 9:41 a.m., in room 

2141, Rayburn House Office Building, the Honorable John Conyers, 

Jr. (Chairman of the Committee) presiding. 

Present: Representatives Conyers, Nadler, Scott, Watt, Jackson 

Lee, Waters, Delahunt, Cohen, Johnson, Pierluisi, Quigley, Chu, 

Deutch, Baldwin, Gonzalez, Sa ́nchez, Polis, Smith, Coble, Goodlatte, Issa, Forbes, King, Franks, and Poe. 

Staff Present: Eric Tamarkin, Majority Counsel; Renata Strause, 

Majority Staff Assistant; Reuben Goetzl, Majority Clerk; and 

Zachary Somers, Minority Counsel. 

Mr. CONYERS. Good morning. The Committee will come to order. 

We welcome everyone, particularly the distinguished witnesses 

that are before us, to discuss the legal liability issues surrounding 

the Gulf Coast oil disaster. The jurisdictional basis for this hearing 

in Judiciary is that the liability issues under the Federal law fall 

to the jurisdiction of this Committee, particularly the Death on the 

High Seas Act, and the Limitation of Liability Act in particular. 

We all know that the oil spill in the Gulf Coast is one of monumental proportions—the worst spill in U.S. history. These considerations are particularly within the jurisdiction of this Committee. 

The current state of the law is inadequate to deal with disasters 

of this size. The legal landscape the victims of the Gulf Coast disaster are navigating is exceedingly complex, outdated, and inconsistent. The remedy available under the Death on the High Seas 

Act for the families of those who were killed is woefully inadequate. 

They are limited to recovering for the direct loss of economic support the deceased would have given to dependent family members. 

The Death on the High Seas Act should be amended so that families who lose a loved one at sea can seek relief to the full measure 

of their loss, including the loss of care and comfort provided by the 

deceased. 

I will put the rest of my statement into the record and recognize 

the distinguished gentleman from Texas, Mr. Lamar Smith. 

[The prepared statement of Mr. Conyers follows:] 

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Mr. SMITH. Thank you, Mr. Chairman. Mr. Chairman, I appreciate your holding this hearing today on the liability issue related 

to the Gulf oil spill. I understand that it was announced just a few 

minutes ago that the top kill effort has been successful. So that is 

the best news we can probably get here today. So the most pressing 

need right now is to contain and remove the oil that has already 

been spilled. 


JCJ-7.eps
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As we move forward, it is equally important that we make sure 

that the parties responsible for this spill and not the American taxpayers pick up the bill. The cost of this bill goes beyond containing 

and removing spilled oil. Those responsible must also pay to remedy the effects of this on America’s natural resources. Additionally, 

the responsible parties must compensate individuals, businesses, 

and governments for their losses. And I know that has already 

begun. 

The Oil Pollution Act and our other environmental laws ensure 

that the responsible parties pay the full cost by holding them 

strictly liable for all removal costs, natural resources damages, and 

up to $75 million in economic damages. While this bill has already 

far exceeded the $75 million cap, it should not be an obstacle to obtaining more funds from responsible parties, since the Act has 

meaningful exceptions and does not apply to State law claims. 

Moreover, British Petroleum repeatedly has called the liability 

cap irrelevant and is committed to pay all legitimate claims. However, I am concerned about some of the proposals to make changes 

to our oil pollution legal process. Following the Exxon Valdez spill, 

Congress worked for 15 months to carefully research the issue and 

ultimately write the Oil Pollution Act. But some Members did not 

even wait 15 days after this most recent spill to push legislation 

to change important provisions of that Act. 

I understand that there is a temptation to punish BP for this 

tragedy, but proposals such as raising liability caps may create 

legal and financial burdens that force independent operators out of 

the oil exploration business altogether. We should not create a situation in which only the so-called super major oil companies and foreign state-owned companies are able to drill for oil offshore. It 

would be ironic if legislation aimed at punishing BP had the perverse effect of enabling only large companies like BP to drill for oil 

off America’s coast. 

I am also concerned that the Obama administration’s response to 

the spill has been slow and insufficient. Louisiana Governor Bobby 

Jindal has characterized the government’s response as a ‘‘disjointed 

effort to date that has too often meant too little to late to stop the 

oil from hitting our coast.’’ Unfortunately, the Administration’s response to this spill has, in large part, consisted of blaming BP and 

railing against big oil, while ignoring its own lack of preparation 

and slow reaction. 

While our response should be swift and targeted to the problem 

at hand, we must be careful not to overreact. Just as after the 

Exxon Valdez spill, we did not stop shipping oil by tanker, we cannot stop drilling for oil off America’s shores. If we banned every industry that had a tragic accident, we wouldn’t drive, we wouldn’t 

fly, we wouldn’t take the train, or travel to the Moon. Instead, we 

have learned from our mistakes and made these industries safer 

for the future. 

We must determine what caused this accident and take steps to 

ensure that it does not happen again. But those steps should not 

include a ban on drilling offshore. At a time when America needs 

to decrease our dependence on foreign oil, now is not the time to 

cut off our own sources of oil. Until we develop viable alternatives 

to fossil fuels, we must continue to drill for oil both on shore and 

10 

off. Our immediate goal should be to make sure all possible resources go toward settling claims, stopping the spill, cleaning up 

the mess, and protecting wildlife in the Gulf from future spills. 

Thank you, Mr. Chairman. I yield back. 

Mr. CONYERS. Are there any other Members that want to welcome our distinguished witnesses today or make an observation of 

extreme brevity? 

Jerry Nadler. 

Mr. NADLER. Thank you, Mr. Chairman. Thank you, Mr. Chairman, for holding this hearing on the legal liability issues. Virtually 

every aspect of the disaster involves different liability issues, which 

we will get to. I just want to make one observation, which I will 

be going into in the questions, and that is with respect to the use 

of chemical dispersants. We are treating chemicals with chemicals 

which don’t actually remove or clean up the oil. They simply shift 

them to another part of the ecosystem while increasing the toxins 

in the Gulf, harming, contaminate the water, and threatening 

human life. There is no scientific evidence that dispersants can be 

effective in an oil spill of this magnitude. These chemicals make it 

harder to track how much oil and where it is going and thus to determine liability. They are good for public relations, but nobody can 

guarantee they are safe. 

Already, we are hearing of people getting sick because of the use 

of these chemicals. In fact, there is already anecdotal evidence people are getting sick from the mixture of oil and toxic dispersants. 

We are basically airdropping this toxic stuff all over the Gulf. It reminds me of Agent Orange. And I am greatly concerned that during this cleanup we are conducting an uncontrolled experiment 

with all the marine and human life in the Gulf Coast region—an 

uncontrolled experiment that could result in thousands of people 

getting sick and dying as a result of the cleanup, not of the original 

disaster. 

I will be going into questions on that during the question period. 

And I hope that we can prevent a repetition of some of the disasters that we have had before. This disaster is unprecedented in 

scope as it is, and I fear we are just going to make it worse. 

Thank you. I yield back. 

Mr. CONYERS. Howard Coble. 

Mr. COBLE. Mr. Chairman, you and the distinguished Ranking 

Member have pretty well covered it. I won’t go into any great detail 

at all. Mr. Chairman, I believe you used the word ‘‘disaster’’ to describe it. I think that is an apt descriptive term. It is, indeed, a disaster. I am glad to hear the news you shared with us, too, Lamar. 

But I appreciate you all being here. I would like to associate myself with the remarks of the distinguished gentleman from Texas, 

when he declared that we should not abandon plans to drill simply 

because of this isolated disaster. We need to keep that on the table, 

it seems to me, Mr. Chairman. 

And I thank you, Mr. Chairman, for having called the hearing. 

I thank the distinguished panel for being with us today. I yield 

back. 

Mr. CONYERS. Bobby Scott. 

Mr. SCOTT. Thank you, Mr. Chairman. I opposed the oil drilling 

expansion for good reason. The Administration announced a few 

11 

weeks ago—and I didn’t think the small gains for a few cents per 

gallon of gasoline saved in outyears is worth the risk. The number 

of jobs that the proponents argue might be created by offshore 

drilling in Virginia pale in comparison to the number of jobs we 

have already seen destroyed by this devastating spill. Devastation 

to sensitive wetland areas, tourism, the fishing industry, recreation 

in the Gulf, would not be any different than what would happen 

off the coast of Virginia, particularly when we are looking at the 

very sensitive Chesapeake Bay. 

Thank you for calling the hearing to ascertain the extent of the 

losses already caused by the spill, and helping determine who will 

be legally liable for these damages. Thank you very much. 

Mr. CONYERS. Darrell Issa. 

Mr. ISSA. Thank you, Mr. Chairman. I thank our panel of witnesses for being here today. As the Chairman said, it is very clear 

that we have limited jurisdiction. Our jurisdiction in this Committee is clearly as to whether or not we change liability limitations and their interpretation. For the Chairman, I commend him 

for starting off this hearing by reminding us that, in fact, we do 

not control the Corps of Engineers that has failed to act to protect 

Louisiana. We do not control the EPA, who only recently discovered 

that these dispersants might or might not be available for this use 

after oil spill after oil spill have occurred from ships over the years. 

We only recently discovered that we really don’t want to invoke the 

Stafford Act, even though it has been on the books and would have 

allowed the President to act—and act more assertively. 

There are so many things that are not within the Committee’s 

jurisdiction. As Ranking Member on Government Oversight, I am 

pleased to say those will be dealt with in other committees of jurisdiction. Today, we are only asked a fairly straightforward question: 

Are the limitations that currently are in place for acts which are 

not in violation of any regulation, including no misconduct, no 

wrongful acts, are the caps high enough at $75 million. Under the 

Oil Pollution Act, if there is so much as one regulatory failure, the 

caps are off. 

So let’s understand. All the cleanup is already the responsibility 

of the parties, in this case, British Petroleum as the leaseholder, 

to $75 million to be paid if no wrongful act is done whatsoever. Not 

so much as failing to dot the ‘‘i’’ on an administrative report that 

may have prevented it. I repeat: May have prevented it. If so much 

as one of those occurs, then everyone who says that they had a bad 

day as a result of this, that they lost economic advantage of any 

sort, and even potentially those who were traumatized would all 

have that opportunity. That is what we will be deciding here today. 

I believe that we should consider whether those caps are high 

enough. We should consider within the body whether or not a fund 

that would exceed that should be in place so that smaller oil companies—smaller than BP, by definition is, everybody—would be 

able to continue to drill while the American people could be confident that the funds necessary not just for if you violate, but even 

if you don’t violate, for the cleanup should be in place. Those are 

not within this Committee’s primary jurisdiction. 

So I do look forward to hearing the narrow question answered of: 

Is the current law for no misconduct whatsoever and the cap that 

12 

goes with it of $75 million sufficient, or is Congress in such a hurry 

that even before we know whether or not there was so much as one 

administrative violation, we want to change that cap? 

I look forward to the testimony and I thank the Chairman and 

yield back. 

Mr. CONYERS. Steve Cohen. 

Mr. COHEN. Thank you, Mr. Chairman. I have got a statement 

that I will just turn in, and it goes through a litany of issues. Some 

may be more relevant than others. Mostly, it concerns the BushCheney-Halliburton administration that is responsible for this; the 

lack of regulation; the lack of oversight; and the laissez faire, cowboy-type mentality that allowed all of this to happen. We have got 

to have regulations and government needs to act to be sure people 

and our environment and our world is safe. But the main thing I 

want to address is Mr. Jones. I want to express my condolences to 

you. To lose a child, and others have lost children, and parents. 

Eleven lives were lost. There is all kind of destruction and damage 

that pains me, to the Gulf Coast, which is close to Memphis. It is 

part of our worlds. But the lives that were lost. I just express my 

condolences to you. 

[The prepared statement of Mr. Cohen follows:] 

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Mr. CONYERS. Sheila Jackson Lee. 


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Ms. JACKSON LEE. Thank you very much, Mr. Chairman. I may 

be the only one on the panel that comes from oil country, at least 

as I can recognize who has lived in a community that has based 

its economic independence and contributions to this Nation on the 

energy industry. Maybe the only former oil and gas lawyer who 

worked for entities that range from oil to natural gas to pipeline 

and to larger multinational oil companies. But I have a heart. 

Frankly, I first want to thank the Chairman for his quickness in moving forward on this hearing. Second, I want to say that $75 

million is a joke. It is a sad state of affairs as we begin to listen 

to the testimony of which we will remain open-minded that we are 

in this dilemma. To all of the families that have lost their loved 

ones and those that remain injured, our deepest sympathy and our 

apology, for we are all in this together. 

There are those of who believe there should be a seamless energy 

policy that includes fossil fuel. But we don’t believe that the devastation that has appeared over this last month and 6 weeks. The 

failing of those who are here who are not victims was to be able 

to have the genius to do deepwater exploration but have no genius 

to be able to fix the consequences. It is the same story that happened with the Valdez in Alaska, I am told, driven by the same 

principles. We know how to move it but we don’t know how to stop 

it. If that is the case, what I want to hear today, Mr. Chairman, 

is a full ownership on what happened and a full commitment to 

pay every single penny that is necessary to make the region whole 

and certainly the families whole. 

I would conclude my remarks by saying that I think it is crucial 

that there is no longer the opportunity to play without the opportunity to pay. And if you are to engage in the deepwater drilling, 

as we are doing off the coast of Ghana, you have got to be able to 

respond to crises and emergencies like this; a gushing hole that 

cannot end. And maybe someone will tell me whether the last 24 

hours have been successful. We have not been able to determine 

that. 

I will say, Mr. Chairman, I think this hearing is about if you are 

going to play, you have got to pay. And $75 million is a disgrace. 

I yield back. 

Mr. CONYERS. Maxine Waters. 

Ms. WATERS. Thank you, Mr. Chair. I would particularly like to 

thank you for the way you manage this Committee and the timeliness of the issues that you deal with. I am appreciative for this 

hearing today. At this hearing today we are focusing on organizing 

around the liability issues related to the BP Deepwater Horizon oil 

spill. BP estimated that the oil spill continues to gush over 5,000 

barrels, that is 21,000 gallons of oil each day into the Gulf of Mexico. However, some independent estimates put the total as high as 

75,000 barrels each day. 

I hope these latest efforts to stop the leak are going to be successful, because everything else has failed. This disaster has already had a devastating impact on the economy of the Gulf Coast 

region and the way of life for many of its residents. Many of these 

residents are still trying to recover from Hurricane Katrina. And 

the BP disaster has doubled their sorrows. During a recent trip to 

New Orleans, I was particularly struck by the stories of the minorVerDate Aug 31 2005 15:09 Nov 29, 2010 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6601 H:\WORK\FULL\052710\56642.000 HJUD1 PsN: 56642
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ity fishermen and small port business owners along the Gulf Coast. 

From week to week, fishermen don’t know how long their jobs will 

be on hold. There are issues that currently exist that must be 

brought to light regarding the plight of minority fishermen related 

to the oil spill. 

Byron Encalade is the President of the Louisiana Oysters Association and the President of the Parish Fishermen Association. I 

know there is something else that goes with that name. He knows 

firsthand the effect that the oil spill is having on fishermen who 

depend upon the waters for their very sustenance. He is here 

today. And I thank him for his participation in the hearing. I am 

sure this Committee will benefit from his story. 

Fishermen have depended upon this season to be the opportunity 

to recover from the past. But this is not going to be the case. The 

oyster season was supposed to open up on May 1st and some fishermen prepared their boats and have been ready to go out for the 

first 2 or 3 days. They planned to bring their first haul of the season and pay bills. But of course that did not happen. 

The National Oceanic and Atmospheric Administration, 

NOAA, has already closed over 54,096 square miles of the Gulf 

of Mexico to commercial and recreational fishing in order to assure 

that seafood will remain safe for consumers. That is slightly more 

than 22 percent of the Federal waters in the Gulf of Mexico. A closure of this size is bound to have a devastating impact on the fisheries in the Gulf. Their commercial fishermen harvested more than 

1 billion pounds of fish and shellfish in 2008. 

On Monday, Secretary of Commerce Gary Locke determined that 

there had been a fishery disaster in the Gulf of Mexico due to the 

economic impact on commercial and recreation fisheries. The affected area includes the States of Louisiana, Mississippi, and Alabama. This determination allows the Federal Government to provide assistance to affected fishermen and local communities under 

the Magnuson-Stevens Fishery Conservation and Management Act. 

The Administration requests $15 million in supplemental appropriations to recover compensation under the Magnuson-Stevens 

Act, while emphasizing that these fund will only be used as a last 

resort. 

Mr. CONYERS. The gentlelady’s time has expired. 

Ms. WATERS. I thank you very much. I am anxious to hear the 

people who are here to provide us with the information. Thank you. 

I yield back. 

Mr. CONYERS. Hank Johnson. 

Mr. JOHNSON. Thank you, Mr. Chairman, for holding this very 

important hearing on the issue of legal liability issues surrounding 

the Gulf Coast oil disaster. First and foremost, I want to express 

my condolences. The April 20 fire and explosion that occurred on 

the Deepwater Horizon oil rig in the Gulf of Mexico resulted in the 

loss of 11 lives. Many more people were injured. My deepest sympathy goes out to the family, friends, and coworkers of the 11 individuals who lost their lives on that day. 

This explosion and fire occurred on the Deepwater Horizon drilling rig that BP was leasing to drill an exploratory well in the Gulf 

of Mexico. Transocean, the world’s largest offshore drilling company, owned and operated the rig. In the aftermath of the exploVerDate Aug 31 2005 15:09 Nov 29, 2010 Jkt 000000 PO 00000 Frm 00021 Fmt 6633 Sfmt 6601 H:\WORK\FULL\052710\56642.000 HJUD1 PsN: 56642
18 

sion, the rig capsized and sank to the ocean floor, resulting in oil 

leaks. Millions of gallons of oil have spilled into the Gulf since this 

tragedy occurred. 

What disturbs me most about this spill is that it could have been 

prevented. Recent reports are stating that BP missed several warning signs that led to the blowout and fire on the Deepwater oil rig. 

This is unacceptable for a company where the first quarter earnings for this year alone was $6.1 billion. As a result, lives were lost 

and the ecosytem and economy are at grave risk. The livelihoods 

of workers and families and the small businesses that rely on the 

Gulf remain in question. 

The family, friends, and coworkers of the 11 people who lost their 

lives want answers and they need to be treated fairly. This Committee wants answers. This hearing will give us the opportunity to 

examine the liability issues stemming from the April 20 explosion. 

It will give us the opportunity to discuss how Congress could 

amend current laws such as the Death on the High Seas Act and 

the Oil Pollution Act to ensure that they are adequate and allow 

for punitive damages and nonpecuniary damages. In this current disaster, BP is subject to a liability cap of $75 

million under the Oil Pollution Act. Although BP has stated that 

it will disregard the cap and pay all the ‘‘legitimate claims,’’ questions remain about who will determine the legitimacy of the claims 

and how those claims will be assessed and resolved. I am eager to 

hear from the witnesses about their thoughts on the current liability laws and what could be done to improve them. Most important, 

I am anxious to learn about what Congress can do to ensure that 

this does not happen again. 

I thank the Chairman for holding this hearing, and I yield back 

the balance of my time. 

Mr. CONYERS. Mr. Delahunt. 

Mr. DELAHUNT. Thank you, Mr. Chairman. I will be very brief. 

First, my condolences to the father of the young man that was lost. 

I think that is very important to say; to articulate. Please understand that it is heartfelt. 

I guess before we approach the issue of should the cap be removed altogether, should it be recalculated, I think it is important 

for this Committee to examine where the $75 million figure came 

from initially. I heard the gentlelady from Texas describe that $75 

million figure as absurd. I think that was her word. I concur and 

agree. How did that ever happen? It clearly wasn’t in this session 

of Congress. It was in the aftermath of the Exxon Valdez. But what 

we learned from that particular disaster was the cost far exceeded 

$75 million. I wonder why there should be a cap at all. I think that 

is the question that we should pose to ourselves and to this panel. 

In terms of the issue of punitive damages, there is going to be 

a series of hearings, multiple Committees, to examine how this 

happened, and why; what was the failure. In the criminal law, we 

have the concept of deterrence. I think it ought to be implicated in 

terms of disasters such as this that are clearly the result of failure 

somewhere along the line. 

I dare say, Mr. Chairman, if punitive damage was implicated 

into the equation of assessing the responsible parties, it would 

make a difference. It would make a serious difference. Because any 

19 

CEO, any corporate board, any management, would be fully aware 

of the potential liability. So I think that is an important consideration. 

I will conclude my remarks there and thank the Chair for calling 

this hearing. But I think those two questions that I just posed are 

important for us in our deliberations to examine. I yield back. 

Mr. CONYERS. Thank you. Mike Quigley. 

Mr. QUIGLEY. Thank you, Mr. Chairman. I recognize that we are 

a long panel, so I will just submit my statement for the record. But 

just very briefly, I know we are talking about oil today. But in the 

end, the larger picture is the cost of carbon, the cost of exploration, 

the cost of using fossil fuels. Today, it is oil, but we could also be 

talking about blowing the tops off of mountains, polluting streams 

for all time, making moonscapes out of whole tracts of land out 

West in areas like Wyoming. We need to recognize it is part of a 

larger picture that only be solved by conversation and by promoting 

and supporting renewable energy, and that, frankly, we sometimes 

don’t like to hear this, but you can’t have everything you want. 

There is a cost to driving the biggest car you can buy 80 miles an 

hour. We have to recognize that as Americans and have to recognize that conservation is the beginning of this and renewable energy is the end. Thank you. 

[The prepared statement of Mr. Quigley follows:] 

20 

PREPARED STATEMENT OF THE HONORABLE MIKE QUIGLEY, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF ILLINOIS, AND MEMBER, COMMITTEE ON THE JUDICIARY


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Mr. CONYERS. We welcome all witnesses. 

Mr. Tom Galligan; Mr. Vincent Foley; Mr. William Lemmer; Mr. 

James Ferguson; Ms. Rachel Clingman; Mr. Darryl Willis; the Attorney General of the State of Mississippi, Jim Hood; Mr. Byron 

Encalade; Mr. Stephen Stone; Mr. Douglas Harold Brown. 

And our first witness is Keith Jones, the father of Gordon Jones, 

who died aboard the Deepwater Horizon on April 20, 2010. Mr. 

Jones is a Louisiana native and a practicing trial lawyer for over 

three decades. Born in Shreveport, he raised his family practice. 

And he is joined by his son, Christopher K. Jones, who is here 


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today. Would you stand up, sir? Thank you very much. He has 

worked with his father in preparation for this testimony today and 

has made himself available to the Committee for any questions 

that Members may have. 

We will have all statements entered into the record. We invite 

you to begin our testimony, Mr. Jones. 

TESTIMONY OF KEITH D. JONES, BATON ROUGE, LA 

Mr. JONES. Chairman Conyers, Ranking Member Smith, and 

other Members of the Committee, it is an honor to be allowed to 

speak with you today. My name is Keith Jones. I am a lawyer from 

Baton Rouge, Louisiana. Seated behind me is my older son Chris, 

who is also a lawyer in Baton Rouge. Chris and I are appearing 

before you today, however, not as attorneys but as the father and 

brother of Gordon Jones, who was killed on the Transocean Deepwater Horizon. We are here for Gordon’s wife, Michelle; sons, Stafford and Maxwell Gordon; for his mother, Missy; for his sister, 

Katie. 

At the outset, I want you to know that just because I am here 

and addressing you today does not mean that I believe that Gordon’s death was more tragic or more important than the other 10 

men that day. I know their families grieve just as much as we do. 

But the only one of the victims I knew was Gordon. 

He was 28. Our youngest child. He is survived by his widow 

Michelle and by his two sons Stafford, who is 2, and Maxwell Gordon, who was born 13 days ago. Gordon was a mud engineer for 

M-I Swaco, who had a contract with BP to provide that service. He 

received his bachelor of arts degree from LSU and then completed 

something called Mud School. After spending some time observing 

the work of those more experienced, Gordon began working as a 

mud engineer. As a relative newcomer, Gordon was sent to a different rig every 2 weeks, including the Transocean Deepwater Horizon. Gordon was good at what he did, as evidenced by fact that 

one of the mud engineers assigned to the Deepwater Horizon left, 

BP was offered a list of mud engineers who had worked at Horizon 

and from that list chose Gordon. 

As you know by now, the Deepwater Horizon was a rig of considerable prestige. It was a very large rig that drilled in very deep 

water and found very large deposits of oil. Gordon was proud that 

he had been so successful so soon in his career. It allowed his wife 

Michelle to quit her job last year. With one son and another on the 

way, Michelle wanted to be a full-time mom. Gordon was chosen 

from that list not only for his skills as a mud engineer but also for 

his personality. Everybody liked Gordon. People who met him liked 

him—and the more they got to know him, the more they liked 

about. 

Gordon was funny. He loved to laugh. He loved even more to 

make others laugh. To have a friend like Gordon was a special gift. 

To lose a friend like Gordon was, and always, will be a bitter loss. 

Gordon even had the ability to make jokes at the expense of others, often me, and they would never get mad at him for it. It was 

a gift he had. And Gordon was a gift we had. We had a visitation 

at the oldest funeral home in Baton Rouge the day before Gordon’s 

memorial. The line of people who came snaked through the funeral 

24 

home, out the front door, and down Government Street. The funeral director said he had never seen anything like it. Imagine. 

And that man for a man who had been with us for 28 years. 

The first picture I would like to show you is my favorite. It was 

taken only a few days before Gordon’s death. And I was standing 

right behind Michelle when she took it. Gordon was giving Stafford 

his first golf lesson. It was, of course, the last golf lesson he will 

get from his dad. I vividly remember driving away from that scene 

thinking they are so happy. 

The next picture is of Gordon holding Stafford soon after Stafford’s birth. I have had the pleasure of being with all three of my 

children when their first children came into the world but I can’t 

say I ever saw a prouder parent than Gordon. You would have 

thought he was the first man ever to father a child. The next picture is of Michelle, Stafford and Maxwell Gordon 13 days ago. We 

are happy and grateful that mother and child are healthy, they are 

home, where together they will all have to learn how to live without Gordon. 

The last picture depicts Gordon’s presence in the delivery room. 

Gordon was a great father to Stafford. He was tireless. Any time 

Stafford wanted to play, Gordon was ready. 

Perhaps the saddest story about Gordon’s death, and there are 

many, is that Stafford is just too young to be able to remember 

anything about his dad in the years to come. Of course, Maxwell 

Gordon will never have been able to know his father. His knowledge of his dad will be limited to pictures and things that Michelle 

and friends tell him. We don’t have to be psychologists to know 

that is not enough. 

His body was cremated. Then the fireboats washed his ashes out 

to sea. I admit that having nothing to say goodbye to is much, 

much harder than I thought it would be. Call it closure or whatever, something is missing for us. 

You may note that I haven’t mentioned how much money Gordon 

made. There is a reason for that. The loss of Gordon’s income is 

the last thing Michelle grieves for. When Michelle tells her boys 

about their dad, she is not going to show them a pay stub. But as 

I understand the present state of the law, that is all Michelle and 

Stafford will recover from those responsible for Gordon’s death. We 

fear that because Maxwell Gordon was born after April 20, 2010, 

the defendants will argue that he is entitled to nothing. 

Please believe me. No amount of money will ever compensate us 

for Gordon’s loss. We know that. But the paying of damages by 

wrongdoers is the only means we have in this country to make 

things right. As time goes by, we learn more and more about whose 

fault it was that this blowout took our Gordon; whose fault it was 

that the accident happened. And whoever ultimately bears the 

blame for that will have to pay money to compensate the families 

of these 11 dead workers. 

How much that will pay is up to you. But reckless acts by employees of corporations, performed to try to make the most money 

the fastest will never be deterred by the payment of mere compensatory damages. Payment of punitive damages by irresponsible 

wrongdoers is the only way they may learn. 

25 

These businesses are here to make money. Punishing them by 

making them pay some of that money to victims who suffer most 

is the only way to get their attention. If you want these companies, 

one of which has is headquarters in Great Britain and another in 

Switzerland, to make every effort to be sure their employees don’t 

act as these did, putting American lives at risks, we must make 

certain they are exposed to pain in the only place they can feel it— 

in their bank accounts. As a friend recently said, make them hurt 

where their heart would be—if they had a heart. 

I am an environmentalist. I worry about the Louisiana wetlands, 

the Florida beaches, all of our precious lands endangered by this 

oil spill. But I do hope and believe this: After much work, perhaps 

for years, this mess will be cleaned up. The wrongdoers here can 

pay enough money to those who have lost their ability to earn a 

living to make that right. And eventually the shrimp will be back. 

The oysters and crabs and fish will be back. And BP will be back. 

We have heard over and over that the value of BP’s stock has 

fallen. But BP is selling for about the same price it was a year ago 

today. So BP, Transocean, Halliburton, and any other company will 

be back because they have the infrastructure and economic might 

to make more money. But Gordon will never be back. Never. And 

neither will the 10 good men who died with him. 

Now the future of those families is in your hands. I urge you to 

do the right thing. Thank you very much for listening. Chris and 

I will be happy to answer any questions you may have. 

[The prepared statement of Keith Jones and Christopher Jones 

follows:] 

26 

PREPARED STATEMENT OF KEITH D. JONES


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Mr. CONYERS. Douglas Harold Brown was chief mechanic and 

acting second engineer on Transocean’s Deepwater Horizon and is 

a survivor of the April 20 explosion. He served in the U.S. Army 

for more than 11 years, began work with R&B Falcon, an offshore 


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oil drilling company that was bought by Transocean, and he became a Transocean employee and one of the original crew members 

of the Deepwater Horizon. 

TESTIMONY OF DOUGLAS HAROLD BROWN, EMPLOYEE, 

TRANSOCEAN, LTD., VANCOUVER, WA 

Mr. BROWN. Chairman Conyers, Ranking Member Smith, and 

Members of the Committee, thank you for inviting me to appear 

before you today. My name is Douglas Harold brown. I was the 

chief mechanic and acting second engineer on the Transocean’s 

Deepwater Horizon. I am 50 years old, married, have a 10-year old 

stepdaughter, and live in Vancouver, Washington. I sailed the 

original voyage of the Deepwater Horizon from Korea to the Gulf 

of Mexico and I have worked 

onboard the vessel until she exploded would around 10 p.m. On 

April 20, 2010. Since 2004, I worked in the engine control room. 

Here is what happened to me that night. 

Shortly before 10 p.m., I was completing my shift and making my 

log entries in the engine control room where I heard a loud hissing 

noise followed by the sound of gas alarms going off. This was followed by the sound of engines ramping up very loudly. These engines provide power to the entire rig and are equipped with an 

electrical and mechanical trip. They are supposed to automatically 

shut the engines down if they exceed certain RPMs. 

As the engines revved louder and louder, I kept expecting the 

trips to shut the engines down, but they never did. They just kept 

revving higher and higher. The one automatic trip that did work 

disconnected the generators from the control panel and plunged us 

into total darkness. But the engines kept revving. Nobody ever 

radioed the control room to inform us that there was a kickback 

or that mud and seawater was shooting into the air. 

I was standing in front of the engine control panel waiting for 

the system to power back up when the first explosion blew me into 

the control panel and into a hole that was created in the floor. A 

short time later, a second explosion blew me to the floor again, the 

ceiling caved in, and debris fell on top of me. I could hear people 

screaming, calling out for help. I was terrified. I did not know what 

was happening, and feared I was going to die. 

I followed two of my coworkers and we crawled out of the hatch 

in the back of the room which had been blown up by the blast. 

When I got to the main deck, I saw the fire on the floor shooting 

up through the derrick. The heat coming from the floor was like 

nothing I have ever felt. Mike Williams, the electrical technician, 

and I, made our way around the fire to bridge. When we got to the 

bridge, the captain sent us to the lifeboats to find the medic because Mike was bleeding badly from his head. When we got to the 

lifeboats, it was complete chaos and mayhem. People were screaming and crying that they did not want to die and we had to get off 

the rig. We stood next to the lifeboats and watched as the fire grew 

larger and larger. While I think we were only there for about 10 

minutes, it seemed like forever. 

Eventually, we were ordered to board the lifeboats and we were 

lowered to the water. We tied up to the Damon Bankston, which 

was a supply boat that had been taking on drilling fluid from the 

34 

rig before the explosion. We were offloaded onto the Bankston, and 

I was taken by helicopter to another rig and eventually to a hospital in Alabama. 

I feel very fortunate that I survived this horrible tragedy. Eleven 

of my fellow crew members were not so fortunate and my heart 

goes out to their families and loved ones. I do not yet know the full 

extent of my injuries. I have been diagnosed with a fracture in my 

left leg and damage and bruising under my kneecap as well as ligament damage and nerve bruising. I have pain in my back and tail 

bone. I still walk with a cane. I am also having problems with my 

short-term memory, loss of fine motor skills, trouble sleeping, 

nightmares and flashbacks to that night. I have been diagnosed 

with PTSD. 

I will never forget that night though; the loss of my friends and 

the effect this has had on so many people. It is important for Congress to understand what happened that day so it doesn’t happen 

again. I think it is also important to understand how Transocean 

manning decisions changed over time. When we first went to work 

on the Deepwater Horizon, we had a fully manned engine room 

which consisted of six people: Chief engineer, first engineer, second 

engineer, third engineer, and two motormen. As the years went by, 

for reasons I do not understand, the flagging of the vessel changed 

from Panamanian to the Marshall Islands. Transocean eliminated 

positions so that we were only left with three people: Chief engineer, second engineer, and one motorman. Three people were left 

to do six people’s job. While this often made it difficult to timely 

complete our daily preventive maintenance, we worked hard and 

did the best we have could. In October, 2009, they reinstated a first 

engineer back in the engine room. That still left us two people 

short compared to when the vessel was flagged under Panamanian 

law. Over the years after Transocean began lessening the crew, I 

and others complained that we need more help. They just kept telling us they would see what they could do. 

I wish to thank you forgiving me the opportunity to testify before 

you today and I am happy to answer any questions I can for you. 

[The prepared statement of Mr. Brown follows:] 

35 

PREPARED STATEMENT OF DOUGLAS HAROLD BROWN


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Mr. CONYERS. Stephen Stone was working for Transocean aboard 

Deepwater Horizon and was injured in the April 20, 2010 explosion. 


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TESTIMONY OF STEPHEN LANE STONE, EMPLOYEE, 

TRANSOCEAN, LTD., KATY, TX 

Mr. STONE. Thank you. Chairman Conyers, Ranking Member 

Smith, and Members of the House Judiciary Committee. Thank you 

for the opportunity to speak with you today. My name is Steven 

Stone. I have worked for Transocean since February of 2008, as a 

roustabout, which is a general laborer on an oil rig. I was onboard 

Transocean’s Deepwater Horizon rig on the night it exploded, killing 11 of my crew members and injuring many more. I am here 

today to tell my story not only about the disaster of April 20, but 

also about the events that led to that disaster. It is my hope that 

armed with this information, this Committee and the country can 

prevent another tragedy like this one from ever happening again. 

Like many people, I have been following the congressional testimony of the executives from Transocean, BP and Halliburton blaming each other for the blowout of the well. When these companies 

put their savings over our safety, they gamble with our lives. They 

gambled with my life, that gambled with the lives of 11 of my crew 

members who will never see their families or loved ones again. 

The blowout of this well was hardly the first thing to go wrong. 

I was working up on deck, helping to pump drilling mud down into 

the wellbore hole. However, we kept losing drilling mud, either because the underground formation was unstable or because drilling 

too quickly caused the formation to crack. 

Either way, about four separate times in the spate of 20 days, 

we had to stop pumping drill mud and pump down a heavy duty 

seal compound instead to seal the cracks in the formation that was 

causing us to lose mud. 

On the night of April 20, 2010, I was asleep in my cabin two 

decks below the surface deck on the Deepwater Horizon. About 

10:00, I woke up to the sound of an explosion. I didn’t know what 

the sound was, so I waited for a few seconds to see what was happening. And then another explosion went off. The force of it ripped 

through my body and collapsed the upper decks of the rig. 

Somehow I opened the door to my cabin, and people were running up and down the halls screaming we had to get out. I ran 

through the door of my cabin toward the stairwell to the lifeboat 

deck, but it had collapsed. I ran back to my room to get my life 

jacket, my shoes, and my wedding ring. I then followed my crane 

operator Eugene Moss, who was running another way to the other 

end of the living quarters and used another stairwell. 

Once on that deck, one deck below the surface, we ran through 

more living quarters to get to the lifeboat deck. The ceiling above 

the life boat deck had collapsed by the galley. The air was smoky 

and gritty with debris. Eugene and I picked our way through the 

rubble to the lifeboat deck outside. 

Once we were outside, I turned and looked at the derrick, which 

was completely engulfed in flames so bright it seemed like daylight. 

I remember people just staring at the flames. Someone was trying 

to muster, which means to get everyone assembled and to get a 

head count. Some people were getting into lifeboats, and some were 

just in such shock, they just stood there unable to move. Suddenly, 

the flames on the derrick intensified, and that is when people 

started to panic and scramble for the lifeboats. 

42 

I got into life boat number two, strapped myself in, and waited 

for what seemed like hours. Some people were getting back out of 

the lifeboat, and another person was still trying to muster and get 

a head count. I was pretty certain I was going to die, so I just sat 

there and waited for something to happen, for the derrick to fall 

down, and take the life boat out. 

Finally, the life boat filled up with smoke. Someone made the 

call to lower our boat into the water. We unlatched from the rig’s 

cables and motored toward the Damon B. Bankston, a nearby supply vessel. The rig medic there tended to the injured until the 

Coast Guard arrived about 30 minutes later. The Coast Guard retrieved the injured from the boat by helicopter, which took them 

about 2 hours, until about 12:30 a.m. 

At 8 a.m., the Damon B. Bankston was finally released to start 

heading back to land. Four hours later, and 14 hours after the explosion, we pulled up to a platform full of Coast Guard investigators about noon on April 21. We were told we had to give a written 

statement before we could leave the boat. After that was done, we 

pulled up to another platform to pick up some paramedics to ride 

back to land with us. At 1:30 a.m., 20 hours after explosion, we finally made it back to land. 

However, before we were allowed to leave, we were lined up and 

made to take a drug test. It was only then, 28 hours after the explosion, that I was given access to a phone and was allowed to call 

my wife and tell her I was okay. 

At last, they arranged to have us all driven to the Crown Plaza 

Hotel in New Orleans where our families were waiting. Another 3 

hours later, we finally made it to the hotel and to our families; 31 

hours after explosion, at 5 am, on April 22nd, I was given a hotel 

room and allowed to rest. I was lucky enough not to suffer any injury that required paramedic treatment, but to say I was not injured isn’t true. I breathed in lots of thick, dark smoke from the 

fire and the explosion and will need to see a doctor for smoke inhalation. 

Like many other crew members I am suffering from post-traumatic stress disorder and have had trouble sleeping, memory loss, 

nightmares, and flashbacks to the explosion. Since the explosion, I 

have also developed a nervous twitch in my eyes, and my doctor 

said that this was probably caused by stress, too. 

A Transocean representative asked me to sign a document stating I was not injured in order to get $5,000 for the loss of my personal possessions in general. This happened 10 days after the explosion in a Denny’s restaurant without my lawyer present. I 

wouldn’t sign the part saying I had suffered no injury. 

My attorney, Brent Coon, handled the 2005 BP refinery explosion 

in Texas. I was sad to learn after the fact about BP’s shockingly 

bad safety record in North America. Also I never would have expected from my company, Transocean, to treat me like a criminal 

after I had survived such a disaster by making me submit to drug 

test and then try to attempt to trick me into giving up my legal 

rights by signing forms without a lawyer present. If I had known 

any of these things, I might have thought twice before setting foot 

on the Deepwater Horizon. 

43 

Members of the Committee, you cannot allow BP and Transocean 

to continue to conduct business this way. 

And I hope that my testimony here today leads to changes that 

make drilling rigs safer places to work so that a tragedy like this 

never happens again. Thank you. 

[The prepared statement of Mr. Stone follows:] 

44 

PREPARED STATEMENT OF STEPHEN STONE


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Mr. CONYERS. Byron Encalade is the president of the Louisiana 

Oysters Association. 

He has a business at East Pointe and has fished for his entire 

life in the Gulf of Mexico. 


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TESTIMONY OF BYRON ENCALADE, PRESIDENT, 

LOUISIANA OYSTERS ASSOCIATION 

Mr. ENCALADE. Mr. Chairman and other representatives of the 

Committee, I want to thank you for giving me the opportunity to 

tell our story. 

My name is Byron Encalade. I am a third-generation oyster fisherman from East Pointe A’La Hache, Louisiana. I currently serve 

as the president of Plaquemines Parish United Fisheries Cooperative and Louisiana Oyster Association. 

Pointe A’La Hache is a small fishing village in Plaquemines Parish, Louisiana, with approximately 300 people. It is primarily an 

African American community with seafood being its primary industry. 

Our family fisheries engage in harvesting oysters and shrimps 

which we transport across Gulf States. As the president of our family fisheries and trucking company, I employ eight people; my 

brother, my two nephews, and five cousins. 

Black oyster fishermen have not been able to amass wealth to 

sustain our community. Therefore, a hurricane, such as Hurricane 

Katrina, and the oil spill have caused us stress and uncertainty for 

our already underserved community. We thought 2010 was the 

year to finally recover from Hurricane Katrina. We have invested 

moneys in our boats and company infrastructure. 

This oil spill will be devastating for Plaquemines Parish, but it 

will be extremely difficult these next few months for fishermen who 

depend on this livelihood as a source of income and food source. 

Once again, we find ourselves crippled by a disaster we did not 

create. And as in the aftermath of the 2005 hurricane season, it 

has been said that the total cleanup and recovery will take months 

if not years to complete. 

On the eve of 2010 hurricane season, which may only make this 

problem worse, I can tell you we do not have that kind of time. 

We need your help. We need congressional oversight on the funds 

distributed by BP and the Federal Government. We in Louisiana 

have learned hard lessons about the need for transparency in recovery, and call upon this Committee to closely monitor the recovery activities. 

Louisiana is a provider of shrimp, oysters, and crabs, and crawfish in the United States, providing about one-third of the seafood 

consumed in our Nation and also approximately $2.4 billion a year 

to the State of economy. Our request is as follows: 

The Federal Government to ensure immediate compensation is 

paid to the fisherman to provide for income replacement and family 

living expense. 

The lack of Federal and State income returns must not preclude 

any fisherman from receiving compensation. 

The claims compensation protocol must include a system of classification of claimants. 

Immediate compensation for 6 months of lost income that is equivalent to at least an annual income of $24,000 per year. Fishermen who can substantiate higher annual income from fishing 

will receive higher payments. 

And at 6 months, somewhere in the period of November, time period of November, a sum equal to one-half of a year’s lost earnings, 

48 

and no less than $12,000 per worker, shall be paid to every fisherman remaining out of work as a result of this disaster. 

Within 12 months, of the initial payment, the Federal Government must make a final assessment of full damages for the lost 

earnings to be made to fishermen. This determination should include evaluation of other long-term losses beyond losses of earnings, such as damage to boats, equipment, damage to other oyster 

beds, and fishing grounds, and other long-term losses. 

Mr. Chairman, I would like to thank you and give a profound 

thanks to Ms. Waters, if I can, and the fishermen, of course, are 

really pleased that she came down and opened our heart and extended the welcome to us up here. 

And you have been very, very kind to us in the fishing community, and we thank you from the bottom of our heart. 

If anybody has any questions, I will be glad to answer. 

[The prepared statement of Mr. Encalade follows:] 

49 

PREPARED STATEMENT OF BYRON ENCALADE


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Mr. CONYERS. We are pleased to have the Attorney General of 

the State of Mississippi, Jim Hood, here. 

The attorney general graduated from the University of Mississippi, served as a clerk with the Supreme Court of that State, 

and Assistant Attorney General for 5 years, District Attorney for 

8 years, tried numerous cases and prosecuted successfully the 1964 

murders of three civil rights workers. 

We welcome you to our hearing today. 


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TESTIMONY OF THE HONORABLE JIM HOOD, 

ATTORNEY GENERAL, STATE OF MISSISSIPPI 

Mr. HOOD. Thank you, Mr. Chairman, thank you for that kind 

introduction. 

And Members of the Committee, I won’t go through what we 

have accomplished as attorneys general. Our five coastal attorneys 

general have been working with British Petroleum. I have a letter 

attached as appendix C in which have we made several demands. 

BP has come forward on most of them. However, there is one 

that creates a problem for the States, and that is why I ask that 

this Committee consider amending some Federal legislation to 

allow our States to recover the full amount of our damages. We are 

still working with BP in hopes that they will waive the right to try 

to remove our State court actions to Federal Court. They will not 

agree to that thus far. 

The difference between the Exxon Valdez case going on over 20 

years and the tobacco litigation, which was filed by my predecessor 

Mike Moore as attorney general of the State of Mississippi—I was 

the assistant AG when the tobacco wars were started and ended. 

And I am familiar with that litigation. And the reason, do you 

know why, that it was settled? Because it was in State court. The 

tobacco industry was about to have to walk into a courtroom down 

on our coast in Pascagoula, Mississippi. That case was settled because we were in State court. The Exxon Valdez case went on for 

20 years because they were in Federal Court. 

As a result of some of the tobacco litigation, there were amendments made here in Congress that have allowed corporations to 

draw in States into multidistrict, multi-State litigation, and that is 

a problem for the States. You see, even though you may have put 

good language in OPA, for example, that says that there can be a 

concurrent State action and the State actions will be recognized, 

well, that doesn’t mean that a Federal judge is going to follow what 

you said. And in fact, a Federal judge in the State of Louisiana has 

said that, under OPA, that your case can be removed from State 

court to Federal Court. 

And the problem with that is that my colleagues here at the 

table, British Petroleum and Transocean have already started a 

sucking sound coming out of Houston, Texas, by two actions that 

they filed before friendly Federal judges in Houston, Texas. 

One of those was filed by Transocean, a limiting action in which 

they try to pull in everybody to a judge in Houston, Texas. BP has 

done the same thing with a consolidation action. 

And the problem for the States is, we don’t need to be pulled into 

some type of a huge class action where we are just treated like another plaintiff out there, and there is no respect for a separate sovereign. In fact, I won’t be able to plead in our State litigation, if 

it occurs, hopefully these companies will come forward, and we are 

trying every way to work with them, and they have worked with 

us, but if there is going to be a fight, I want it to be in our State 

court. 

We are not going to recover a dime more than we are entitled. 

We don’t want a dime more than what we are entitled in State 

court. But what happens in Federal Court is that these Federal 

judges get these huge mass actions and all their duty is, is just to 

53 

beat people into submission, and that includes States and people 

don’t recover what they are entitled to. 

I won’t be able to plead a claim under OPA because I know what 

is going to happen. They are going to take that Federal District 

Judge’s case out of Louisiana and try to suck Mississippi into Federal district litigation. 

That happened in the insurance litigation. If you recall, after 

Katrina, I was the attorney general that filed a suit against most 

of the insurance industry. That is what they did. They drug us off 

into Federal Court on a motion to remove, and it sat there and lingered in Federal Court for 15 months. Finally, it was remanded 

back to State court. We reached a settlement with the insurance 

industry, but we carried forth that issue to our State supreme 

court to make a decision on Wind v. Water Liability. Well, it took 

4 years to get to a State supreme court. Everybody settled. It was 

a hollow victory. I won 9-zero. 

But what happened is the Fifth District didn’t defer to the State 

as it should have under—it is a contract law. It is a State issue. 

The Fifth Circuit didn’t defer to the State court, and they got it all 

wrong. It is too late to back up. 

So we don’t want to wind up before Federal Court where they are 

going to drag us in with another group and treat us like any other 

plaintiff. 

Secondly, the Class Action Fairness Act was passed by Congress, 

and in that, on all the comments from the Senators on the floor, 

oh, well, the States won’t be included in this, the States won’t be 

sucked into a class action fairness action. Well, guess what? The 

Fifth Circuit said—actually a district judge in Louisiana said that, 

yes, the States belong into it. In a case called Caldwell v. Allstate, 

the court, the Fifth Circuit held that, yes, the States are subject 

to CAFA, the Class Action Fairness Act, in which we get jerked 

into all this multidistrict litigation. And it creates such a problem 

that the States are beaten into submission. 

The Federal judge in Alaska case beat—there was a State court 

judge making parallel rulings at the time just ignored the State 

completely, didn’t even accept the separate sovereign, beat those 

fishermen and plaintiffs into submission, and I suspect the State 

and Federal Government as well. 

I do not want to see that happen, and therefore, I have submitted to this Committee several changes that I believe will allow 

the States to seek our damages in State court and protect our citizens. 

Lastly, the parens patriae authority of attorney general is as one 

recognized by our United States Supreme Court as a supreme duty 

of an attorney general. It means protect those who cannot protect 

themselves. Parens patriae is the Latin term for that. 

I will not be able to plead parens patriae claims. The reason for 

that is because of that Caldwell case, the Fifth Circuit will say, oh, 

you are just a mass action, you are bringing that on behalf of your 

citizens and trying to drag us into Federal Court. 

And that is where we do not want to be. We want our decision 

made in State court so we can quickly resolve our issues, if there 

are any, and we will not be subject to a lot of the other problems 

that the Limitations of Liability Act can bring States in forward. 

54 

Thank you for the opportunity for being here, and I will be glad 

to try to answer any questions afterwards. 

[The prepared statement of Mr. Hood follows:] 

PREPARED STATEMENT OF THE HONORABLE JIM HOOD


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Mr. CONYERS. Darryl Willis, vice president of resources at BP. 

On April 29, 2010, he accepted the role of overseeing BP’s claims 

process. 


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Born in Louisiana, undergraduate Northwestern State University 

in Louisiana, master’s degree in geology and geophysics in Louisiana State University, MBA from Stanford University, and he has 

been with BP since 1996 when he started as the lead operations 

geoscientist for BP North American gas. 

TESTIMONY OF DARRYL WILLIS, VICE PRESIDENT, 

RESOURCES, BP AMERICA 

Mr. WILLIS. Chairman Conyers, Ranking Member Smith, Members of the Committee, I’m Darryl Willis, vice president of resources for BP America. 

On April 29, 2010, I accepted the role of overseeing BP’s claims 

process, which was established in the wake of the explosion and 

fire aboard the Deepwater Horizon drilling rig and the ensuing oil 

spill. I’m here to share information with you about the claims process. 

This horrendous incident, which killed 11 workers and injured 17 

others, has profoundly touched all of us. There has been tremendous shock that such an accident could have happened and great 

sorrow for the lives lost and the injuries sustained. 

I would like to make one thing very clear. BP will not rest until 

the well is under control and we discover what happened and why 

in order to ensure that it never happens again. 

As a responsible party, under the Oil Pollution Act of 1990, we 

will carry out our obligations to mitigate the environmental and 

economic impact of this incident. 

I would also like to underscore that the causes of the accident remain under investigation, both by the Federal Government and by 

BP itself. So I’m prepared today to answer your questions regarding the claims process. 

I cannot, however, respond to inquiries about the incident itself 

or the investigation. 

Above all, I want to emphasize that the BP claims process is integral to our commitment to do the right thing. We will be fair and 

expeditious in responding to claims. We have already paid out more 

than 35—$37 million in claims. 

We understand how important it is to get this right for the residents and businesses as well as for the State and local governments. To that end, we have established 24 walk-in claims offices 

operating in Louisiana, Mississippi, Alabama, and Florida. And we 

have a call center that is operating 24 hours a day, 7 days a week. 

We have also established an online claims filing system to further 

expand and expedite our capacity to respond to potential claimants. 

All together, we have nearly 700 people handling claims with 

over 400 experienced claims adjusters on the ground working in 

the impacted communities. We will continue adding people, offices, 

and resources as required and are committing the full resources of 

BP to making this process work for the people across the Gulf 

Coast. 

Our focus is on individuals and small businesses whose livelihoods have been directly impacted by the spill and who are temporarily unable to work. These are fishermen, the crabbers, the oyster 

harvesters and shrimpers with the greatest immediate financial 

need. BP is providing expedited interim payments to those whose 

86 

income has been interrupted. Approximately 13,500 claims have already been paid totaling, as I said, $37 million to date. 

The claims process was established to fulfill obligations as a designated responsible party under the Oil Pollution Act of 1990, OPA. 

Thus we are guided by the provisions of OPA 90 as well as the U.S. 

Coast Guard regulations when assessing claims. 

I am not an attorney and therefore cannot speak to particular 

legal interpretations or applications of OPA 90. I can, however, reiterate that BP does not intend to use the $75 million cap in the 

OPA 90 statute to limit our obligation to pay these claims. We expect to exceed it, and we will not seek reimbursement from the oil 

spill liability trust fund. 

In closing, I would like to add a personal note. My ties to the 

Gulf Coast run deep. I was born and raised in Louisiana. I went 

to high school there, college there and graduate school there. 

My family spent many, many summers vacationing along the 

Gulf Coast. My mother lost her home of 45 years in Hurricane 

Katrina, and the recovery process was time-consuming and at 

many times incredibly frustrating. I know firsthand that the people 

in this region cannot afford lengthy delays in addressing economic 

losses caused by this spill. 

I volunteered for this assignment because I am passionate about 

the Gulf Coast. It is the place I call home, and I want to be part 

of the solution. 

Finally, as we respectfully informed the Committee, I have been 

asked to testify at a hearing chaired by Senator Landrieu of Louisiana this afternoon. Therefore, I may need to excuse myself if this 

hearing runs past 2:30 p.m. 

If that happens, I will be pleased to answer any additional questions from this Committee in writing. 

And with that, I welcome your questions. 

[The prepared statement of Mr. Willis follows:] 

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PREPARED STATEMENT OF DARRYL WILLIS


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Mr. CONYERS. Thank you. But if we need you for additional questions, we will want you to be present. 

Attorney Rachel Clingman, acting general counsel for 

Transocean, partner in charge of Sutherland’s Houston office who 

specializes in energy, transportation and commercial litigation, 


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graduate of Rice University, University of Texas Law School, and 

has been honored regionally and nationally for legal excellence. 

TESTIMONY OF RACHEL G. CLINGMAN, 

ACTING GENERAL COUNSEL, TRANSOCEAN, LTD. 

Ms. CLINGMAN. Thank you, Chairman. 

Chairman Conyers, Ranking Member Smith and other Members 

of the Committee, thank you for the opportunity to speak with you 

today. I am a partner with Sutherland Asbill & Brennan, but at 

present, I am working at Transocean, helping to address the legal 

issues related to the Deepwater Horizon incident. 

The last few weeks have been a time of great loss, sadness and 

frustration for many, including all of us at Transocean. Our hearts 

and prayers are with the widows, children and families of the 11 

lives who were lost, nine of whom were Transocean employees. Our 

hearts are with those who were injured and with those who evacuated and survived. We and I offer our deepest sympathies. 

We are committed to protecting the memory of those who were 

lost and to providing for their families. 

I am here today to report to the Committee on various legal 

issues facing Transocean. First and foremost, Transocean is fully 

prepared to meet all of its legal obligations arising from the Deepwater Horizon accident. I want to assure the Committee and those 

represented here today that addressing and resolving the claims of 

Transocean employees who were injured and the families who lost 

loved ones is a top company priority. Those discussions are beginning now, and it is our hope that we can resolve these claims fairly, quickly and amicably. 

The Deepwater Horizon accident has resulted in many legal challenges for the courts and the companies and the families and claimants represented here. These involve class-action lawsuits as well 

as claims under the two frameworks of the Oil Pollution Act and 

general maritime law, including the Jones Act. 

As you know, this Congress enacted OPA, the Oil Pollution Act, 

in 1990 to compensate on a no-fault basis people and businesses for 

damages caused by oil spills and contamination. The statute establishes a claims process that enables anyone damaged by an oil spill 

to obtain compensation from a responsible party. In this case, the 

Coast Guard designated BP as the responsible party for oil and gas 

flowing from the subsea well. As you have heard again today, BP 

accepted that designation and has testified that it will pay all legitimate claims regardless of the statutory $75 million cap. 

As we understand, BP has established that process and paid a 

substantial number of claims to date. 

The U.S. Coast Guard designated Transocean as a responsible 

party under OPA, and we have accepted that responsibility for any 

contamination from the mobile work space, the rig. There has been 

no indication thus far of any contamination from the rig itself. 

However, we stand ready to meet any legal obligation that arises 

from that status. 

The OPA claims process allows someone to file a lawsuit only if 

and when BP has denied a claim or not reached a claim to the 

claimant’s satisfaction. Nonetheless, as you know, a great number 

of lawsuits have already been filed, including approximately 135 

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against Transocean across eight States. Most of these are class actions in which small business interests and other commercial interests claim a current or potential future loss of business in the 

aftermath of the spill. 

There is substantial overlap in the lawsuits. Florida property 

owners, for example, are included in the proposed class of at least 

three lawsuits today. Louisiana residents who derive income from 

the coastal zone are claimants in at least four class actions. And 

overarching all of these suits are class actions on behalf of all persons damaged in the Gulf of Mexico. 

These multiple and duplicative lawsuits create confusion. They 

strain judicial resources and could lead to disparate treatment for 

litigants who are similarly situated. For these reasons, both plaintiffs and defendants have filed motions asking to establish a multidistrict litigation or MDL proceeding to bring all of these lawsuits 

together in one court and consolidate those claims. 

The second category of claims as I indicated are not the class actions but personal injury and death claims covered by general maritime law, as mentioned by Chairman Conyers. 

These include the Jones Act, which provide seamen 

the right to sue and which create favorable presumptions that 

ease their path to recovery. This maritime body of law applies to 

the crew members of the rig. 

At the same time that that law enacted by Congress makes it 

easier for seamen to pursue and recover claims, it also provides 

limitation actions on total damages for such claims. 

Under the maritime law, Transocean has filed a maritime limitation of liability action in the United States district Court for the 

Southern District of Texas. This law, recently reviewed and recodified by Congress in 2006, allows ship owners to consolidate actions 

and define their liability in a situation like this. We have filed the 

action. We have requested consolidation, and we have indicated an 

initial proposed limitation of liability based on the statutory calculation at just under $27 million. 

The ultimate amount and what will be included will be left to the 

court governing that action. 

I want to stress that limitation does not apply to claims asserted 

against Transocean under the Oil Pollution Act. Transocean has 

asked the limitations court to clarify the existing order to make 

that clear, and that order has been so amended. 

Transocean filed this limitation action for several reasons. We 

believe it is important to have a central venue for these actions to 

maintain some continuity and consistency that will not be possible 

if lawsuits proceed in various States and Federal courts. 

In addition, our underwriters instructed us to file the limitation 

action, and we did so to avoid losing any insurance coverage that 

will help pay claims. 

Overridingly, however, Transocean is committed to resolving all 

of the interrelated legal matters diligently expeditiously and fairly. 

Our overriding mission in connection with BP, the unified command, government officials and other contractors is to stopping the 

leak, containing contamination, and determine the cause of explosion. 

95 

And my heart is lightened to hear Chairman Conyers say that 

the top kill, kill-shot method may have been successful. 

I thank you again for the opportunity to speak with you today, 

and I look forward to answering any of the questions you may 

have. 

[The prepared statement of Ms. Clingman follows:] 

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PREPARED STATEMENT OF RACHEL G. CLINGMAN


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Mr. CONYERS. Attorney James Ferguson, senior vice president 

and deputy general counsel for Halliburton. 

Included in his responsibilities are litigation, environmental employment law activities in the company’s law department. He 

began in 1988, assumed the deputy general counsel position in 


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2007, and served as director of risk management and assistant general counsel for Halliburton. 

TESTIMONY OF JAMES W. FERGUSON, SENIOR VICE 

PRESIDENT AND DEPUTY GENERAL COUNSEL, HALLIBURTON 

Mr. FERGUSON. Chairman Conyers, Ranking Member Smith 

Members of the Committee, I thank you for the ability to appear 

here today and the opportunity to share Halliburton’s perspective 

as you review the legal issues related to the Deepwater Horizon catastrophe. 

Halliburton looks forward to continuing to work with the Congress, the Administration, and now the Presidential commission to 

understand what happened and what we can do to ensure that oil 

and gas production is undertaken in the safest and most environmentally responsible manner. 

The catastrophic blow out and the spread of oil in the Gulf of 

Mexico are tragic events for everyone. Halliburton extends its deepest sympathy to the family, to the friends and the colleagues of the 

11 people who lost their lives and to those workers that were injured in this tragedy. 

Halliburton has and will continue to fully support and cooperate 

with the ongoing investigations into how and why this tragic event 

happened. We will continue to make our personnel available, and 

we have produced approximately 50,000 pages of documents. 

As you can no doubt appreciate, there has already been an immense amount of litigation filed in connection with the blow out. 

As of May 23, Halliburton, has been named in 112 suits involving 

pollution damage claims and four suits bringing personal injury 

claims. With current investigations underway, it is still premature 

for Halliburton to offer theories about what happened. Thus I will 

not be addressing technical and operational issues, which, in any 

event, are not within my expertise, but instead will focus on the 

issues that you posed in your invitation to testify. 

Mr. Chairman, you ask that we discuss legal liability issues surrounding the Gulf Coast disaster. In addition, you have expressed 

concern about waivers individuals were asked to sign as they returned to shore from the Deepwater Horizon. With respect to the 

waivers, Halliburton did not ask any of our four employees to sign 

a waiver or any other document as they returned to shore. Our employee assistance personnel were already in contact with their families and provided whatever aid and support the employees needed. 

Since then, we have reached a settlement with one employee 

which did involve a release by the employee. 

As you consider broader liability questions, it is important to understand the structure of the oil and gas exploration and production business and, in particular, the roles and responsibilities of the 

various parties involved in drilling a deepwater well. In the Gulf 

of Mexico, an oil company obtains a lease from the government 

with rights to explore for and produce hydrocarbons. After meeting 

applicable regulatory requirements, the oil company, as the well 

owner, will engage a drilling contractor and many other service and 

equipment companies to work on that well. 

The construction of a deepwater well is a complex operation involving the performance of numerous tasks by multiple parties led 

101 

by the well owner’s representative, who has the ultimate authority 

for decisions on how and when various activities are conducted. 

With respect to the Mississippi Canyon 252 Well, Halliburton 

was contracted by the well owner to perform a variety of services 

on the rig. That included certain aspects of the cementing process, 

but contrary to some press reports, Halliburton did not provide and 

hold equipment such as casing wellheads, seal assemblies, float 

equipment. 

Halliburton is a service provider to the well owner who is contractually bound to comply with the well owner’s instructions on all 

matters relating to the performance of all work-related activities. 

That does not extend however to acts that would create an imminent safety hazard. Our employees are authorized to stop work in 

such situations. 

Over the years, certain industry practices have developed with 

respect to the allocation of potential liabilities. Since it is the well 

owner that is entering into agreements with the drilling contractor 

and with the various other contractors and suppliers, the well 

owner will often establish a system of reciprocal indemnity obligations through these contracts. Also, it is customary for the well 

owner to take responsibility for certain potentially catastrophic 

events, including loss of control of the well and pollution emanating 

from the well. 

Accordingly, the well owner assumes the obligation to indemnify 

the contractors for liability arising from such occurrences. 

The terms of the applicable Halliburton contract are consistent 

with this common liability allocation arrangement. Therefore, Halliburton is obligated to indemnify and hold the water well owner 

and the other contractors harmless with respect to claims by our 

employees and with respect to loss or damage to our equipment. 

In like manner, the well owner and each of the other contractors 

are bound to hold Halliburton harmless against claims by their employees and for loss or damage to their property. 

Finally, the well owner has assumed the obligation to hold Halliburton harmless against the costs for controlling the well as well 

as for the cleanup and damages caused by the oil pollution. 

In closing, Halliburton will continue to cooperate with the effort 

to understand what happened and what can be done to ensure that 

oil and gas production is undertaken in a safe and environmentally 

responsible manner. 

Thank you for the opportunity to share our views, and I will be 

happy to answer questions later on. 

[The prepared statement of Mr. Ferguson follows:] 

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PREPARED STATEMENT OF JAMES W. FERGUSON


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Mr. CONYERS. Attorney William Lemmer, general counsel for 

Cameron International Corporation, was previously with Oryx Energy Company where he served as vice president, general counsel, 

corporate secretary, and as chief counsel. He has also held senior 

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State University Honors College and a juris doctor from University 

of Virginia law school. 

TESTIMONY OF WILLIAM C. LEMMER, SENIOR VICE PRESIDENT AND GENERAL COUNSEL, CAMERON INTERNATIONAL 

CORPORATION 

Mr. LEMMER. Chairman Conyers, Ranking Member Smith, Members of the Committee, good morning. 

My name is Bill Lemmer, and I am the senior vice president and 

vice president of Cameron International Corporation. 

I wish I could say I appreciate the invitation to be here today, 

but the fact of the matter is that we are here to discuss a truly 

tragic event and the consequences it has and will continue to flow 

from it. Cameron continues to lend its assistance and efforts relating to capping the well, and we continue to work with everyone involved to try to understand what happened and how this happened. 

Cameron is based in Houston, Texas, and is the leading provider 

of equipment and services to the energy industry, with eleven different operating divisions and approximately 18,000 employees in 

more than 300 locations. The Cameron product used by the Deepwater Horizon is called a blow-out preventer, or BOP, a product 

that Cameron invented in the 1920’s that allows our customers to 

control the pressure in a well while being drilled. 

There are over 400 Cameron BOPs operating sub-sea; 130 are operating in deep water. Each individual BOP stack is made up of 

components specified by our customers and configured to their specific operating specifications. Each is manufactured and tested in 

accordance with industry standards and applicable regulations. 

Our BOPs have a very long history of reliable performance, including performance in some of the harshest operating conditions 

in the world. The BOP in the Deepwater Horizon was operating at 

5,000 feet below sea level at the time of the incident. As soon as 

Cameron was notified of this incident, we mobilized a team of our 

best drilling specialists to work with BP, Transocean, and others 

to assist with efforts to shut in this well. 

Our people have been working around the clock to assist in this 

effort, and we will continue to provide all of the resources at our 

disposal until this well is shut in. 

On the subject of today’s hearing, it is difficult to state anything 

with precision at this stage. Efforts to cap the well are ongoing, 

and the facts relating to the explosion and its impact on the BOP 

and its ability to function properly are simply unknown at this 

point. The present challenges involved in determining causes and 

effects are many, in particular, from our standpoint, the inability 

to examine the Deepwater Horizon’s BOP. Therefore, it appears to 

be far too early to draw factual conclusions about how this incident 

occurred. 

And so, too, is it with respect to questions of liability, which are 

by their very nature closely linked to these presently unanswered 

factual questions. Anything specific we might say in this connection 

would be speculative and perhaps misleading or potentially so to 

the Committee and to the public. 

Given the very limited extent of everyone’s present understanding of the facts, is it possible for anyone to make any liability 

109 

determinations at this point? Nonetheless every one of us is mindful of the personal, environmental and economic concerns associated with this incident. We understand the need to discover the 

facts relating to what went wrong and to do all that is possible to 

prevent the occurrence of such an incident in the future. I am here 

to answer any of your questions. Thank you. 

[The prepared statement of Mr. Lemmer follows:] 

PREPARED STATEMENT OF WILLIAM C. LEMMER


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Mr. CONYERS. Attorney Vincent Foley, partner with Holland & 

Knight in the Maritime Practice Group, practicing primarily in the 

area of international litigation arising out of vessel casualties, including collisions, groundings, explosions, fires, and oil spills. He 

has participated in all aspects of oil spill litigation, oil pollution 

prevention seminars, formal response drills and oil spill response 

training, a graduate of the Merchant Marine Academy and the 

Tulane Law School. 


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TESTIMONY OF VINCENT J. FOLEY, PARTNER, 

HOLLAND & KNIGHT, LLP 

Mr. FOLEY. Thank you, Mr. Chairman, and distinguished Members of the Committee. 

I am grateful for this opportunity, honor, and privilege to address 

the Committee today. I am here to discuss the oil spill liability and 

compensation scheme in place in the U.S. 

The Oil Pollution Act of 1990 is the primary Federal statute 

dealing with liability and compensation for the discharge of oil in 

navigable waters. OPA is part of a larger statutory scheme which 

includes the Federal Water Pollution Control Act, or the Clean 

Water Act, which also provides for civil and criminal penalties for 

oil spills on a per-day, per-barrel basis, with no limits of liability. 

The OPA compensation and liability scheme, the objective of the 

scheme was to provide compensation to claimants for oil spills. 

OPA works by designating a responsible party to set up a claims 

process to allow claimants to seek compensation. For a vessel, the 

responsible party means the owner or operator or basically the entity responsible for day-to-day activities. And the OPA limits of liability for a vessel are calculated based on the gross tonnage, 

which is the total overall internal volume of the vessel. 

The OPA also has a provision for offshore facilities. The responsible party for an offshore facility is the lessee or permittee of the 

area in which the facility is located. The offshore facility limit is 

a more complicated analysis which involves, because unlike gross 

tonnage for a vessel, which has a certain maximum capacity, an 

offshore facility has access to an oil field in the sea bed. The OPA 

limit for an offshore facility is $75 million for damages, but importantly, it is unlimited for removal costs. 

Now, in addition to setting up a liability scheme, OPA also set 

up a compensation scheme through the National Pollution Fund 

Center and the Oil Spill Liability Trust Fund. The Oil Spill Liability Trust Fund is an emergency fund for payments to claimants 

over the OPA limits. The fund is sourced by a per-barrel petroleum 

tax as well as collection of fines and penalties for violation of other 

environmental statutes and recoveries by the National Pollution 

Fund from responsible parties. 

The fund steps in to pay claims that are either denied by a responsible party or that are over the responsible party’s set limits 

of liability. 

Now, with respect to the limits of liability, it is important to 

point out that the OPA limits of liability require the participants 

in the industry to show evidence of financial responsibility up to 

those limits. And the purpose of that financial responsibility is so 

that there are immediate funds available to set up this compensation scheme and to start paying claimants. 

When I mentioned the offshore facility, the $75 million limit for 

damages and unlimited for removal costs, those are the two primary types of OPA claims. The removal costs include the cleanup, 

the prevention, minimizing the extent of the oil spill, mitigation 

and disposal of the oil. The damages are the economic loss damages, such as injury to natural resources, injuries to real or personal property, loss of revenue from use of natural resources, loss 

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of profits and earning capacity and public services rendered during 

or after removal activities. 

With respect to both types of claims, whether they are removal 

or damages, there is supporting documentation needed to establish 

that you have a compensable claim under the statute, whether you 

make the claim to the responsible party or to the National Pollution Fund. 

And the way the system is set up, the claimants are required to 

make the claim first to the responsible party to seek payment. If 

that claim is not paid within 90 days, they may, they have the option to litigate against the responsible party or to seek compensation from the National Pollution Fund Center, which will be an adjudication also based on documentation of that claim. 

So that is the system set up by OPA. 

With respect to the limits of liability, there have been increases 

in OPA limits with respect to vessels. There was a recent increase 

for vessel OPA limits in the 2006 Delaware River Protection Act. 

It increased the OPA limits of liability for vessels and also increased the responsible party payments to the trust fund. 

And in 2010, just recently, we had a consumer price index increase in the vessel limits for liability. 

There have not been increases to the OPA limit of liability, the damage limitation of $75 million, but, again, there is an unlimited 

amount for removal costs. 

Now also when we talk about limits of liability, it is important 

to understand that there is unlimited liability under OPA. A responsible party will lose their liability limits and be strictly liable 

on an unlimited basis in two situations: One, there is a situation 

where they lose their limits for gross negligence or willful misconduct, violation of an applicable Federal safety construction operating regulation by a responsible party or by a party under contract with a responsible party, or the third category where you 

would lose a limit would be a failure after the spill to report the 

spill, a failure to provide reasonable cooperation or a failure to follow a governmental order. 

If any of those circumstances exist in the aftermath of a spill, the 

responsible party would lose their limits of liability and have unlimited liability. 

The second area where you have unlimited liability is that OPA 

allows States to impose supplemental liability over and above the 

OPA limitations. So here is another opportunity to have unlimited 

liability that is already built into the statute. 

With respect to the industry experience with the OPA liability 

schemes that I have just described, it has been a positive experience. The system works within the responsible party limits for the 

vast majority of oil spills. For exceptional spills which exceed the 

OPA limits, the Emergency Trust Fund is available to make payments. And the Emergency Trust Fund is based on a per-barrel petroleum tax. Alternatively, the responsible party will pay in the excess of their limits without seeking reimbursement for the reasons 

I—because of the threat of an unlimited liability for violation of a 

Federal safety—applicable Federal safety regulation or gross negligence or potentially criminal liability under the Federal statutes 

that impose criminal liabilities for oil discharge. 

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It is important when you are considering an increase to the OPA 

limits, it is important to carefully study the overall liability and 

compensation scheme. A precipitous change in OPA limits could 

have adverse and unintended impacts on this functioning and reliable compensation system for oil spills. 

There is also a potential to disrupt U.S. oil imports because an 

increase in OPA limits comes with an increase to the participants 

in the industry to provide this financial responsibility certificate. 

This essentially will require extraordinary and, in most cases, 

unaffordable premiums for the participants in the industry and 

may cause most small, mid-sized and even large owner and operators out of business, leaving only major players who can self-insure 

to continue with the U.S. oil import business. 

Thank you for the opportunity to address you this morning, and 

I look forward to your questions. 

[The prepared statement of Mr. Foley follows:] 

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PREPARED STATEMENT OF VINCENT J. FOLEY


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Mr. CONYERS. Tom Galligan, is the president of Colby-Sawyer 

College. From 1986 to 1998, he taught at the Paul M. Hebert Law 

Center at Louisiana State University. He was previously dean and 

professor of law at the University of Tennessee College of Law and 

has published numerous books and articles on torts and admiralty. 

His scholarship has been cited in the restatement of torts and by 


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numerous legal scholars. He has been cited by the United States 

Supreme Court and other Federal and State appellate trial courts. 

TESTIMONY OF THOMAS C. GALLIGAN, PRESIDENT AND 

PROFESSOR, COLBY-SAWYER COLLEGE 

Mr. GALLIGAN. Thank you. Chairman Conyers, Ranking Member 

Smith and Members of the Committee, thank you for inviting me 

to appear before you today. 

My name is Tom Galligan, and I am the president of Colby Sawyer-College in New London, New Hampshire. 

The oil spill in the Gulf of Mexico and the ensuing disastrous 

consequences have forced our Nation to consider its damage recovery regimes for injuries and deaths arising from maritime and environmental catastrophes. Doing so reveals inequities and inconsistencies that you in Congress have the chance and ability to repair by amending the relevant statutes. 

I would like to begin with a discussion of wrongful death recovery under the Jones Act, which is applicable to the negligencebased wrongful death actions by the survivors of a seaman, and the 

Death on the High Seas Act, which defines the rights to recover for 

wrongful death in all other cases arising from incidents occurring 

on the high seas. 

As interpreted, neither of these statutes allows recovery for loss 

of society damages to the survivors of those killed in maritime disasters. 

Now what are loss of society damages? They are compensation 

for the loss of care, comfort, and companionship caused by the 

death of a loved one. The majority of American jurisdictions today 

do recognize some right to recover for loss of society damages in 

wrongful death cases. But the Jones Act, and DOHSA do not. 

Now one might arguably understand the unavailability of loss of 

society damages in 1920, when the Jones Act and DOHSA were 

passed. It was a different world. But to deny recovery of loss of society damages to a loved one in a wrongful death case in 2010 is 

out of the legal mainstream, and it is a throwback to a past era. 

A spouse, child, or parent who loses a loved one suffers a very real 

loss, a loss of care, comfort and companionship, and the law should 

recognize that loss. 

Congress can appropriately make the law consistent with current 

moral, social, and familial realities by amending the relevant statutes to provide recovery for loss of care, comfort, and companionship in maritime wrongful death cases. 

Now, interestingly, there is one exception to the rule barring recovery of loss of society damages under DOHSA. And that exception points up current inconsistencies in the law. In 2000, after the 

Korean Airline and TWA disasters, you amended DOHSA to provide recovery of loss of society to the survivors of those killed in 

high-seas commercial aviation disasters. Thus, in commercial aviation disasters, DOHSA is consistent with modern law and values. 

But for anyone else killed on the high seas, someone killed on a 

cruise ship, someone killed on a semisubmersible floating rig, or 

someone killed on a helicopter, the survivors may not recover loss 

of society damages. 

121 

The proposed amendment would provide all survivors of those 

killed in maritime disasters with the recovery now available in 

commercial aviation wrongful death cases. 

And I would like to pause here and say one thing about OPA 90. 

OPA 90 does not cover and does not provide recovery in personal 

injury and wrongful death cases. Those are outside the scope of 

OPA 90. 

I would like to shift from wrongful death to survival actions and 

note that the Supreme Court in a high seas death case has held 

that predeath pain and suffering is not recoverable in a maritime 

survival action when the death arises on the high seas. Thus, in 

any case covered by that rule, no matter how much the decedent 

may have suffered before his or her death, those damages are not 

recoverable. They should be available. 

Another subject of significant import arising out of this disaster 

is the potential recoverability of punitive damages in various types 

of maritime cases. The United States Supreme Court has twice in 

the last 2 years held that punitive damages are recoverable under 

general maritime law. But it has limited that recovery in admiralty 

to a one-to-one ratio of punitive damages to compensatory damages. 

Today, America might well consider if that one-to-one ratio cap 

frustrates the deterrent aspects of punitive damages in certain 

maritime cases. 

It is less clear if punitive damages are available in Jones Act and 

DOHSA cases. Until the most recent Supreme Court case on this 

subject, I would have said no. Now I am less sure. 

A final critical point in this analysis is the effect and applicability of the Limitation of Liability Act to these events. Originally 

passed in 1851 to encourage investment in maritime shipping and 

commerce, the act allows a vessel owner and some others to limit 

liability to the post-voyage value of the vessel plus pending freight 

if the liability is incurred without the privity or knowledge of the 

owner. One may justifiably wonder whether an act, passed at a 

time before the modern development of the corporate form and before the evolution of modern bankruptcy law, is still salient in personal injury and wrongful death cases. However, limitation still exists and in this case presents this Committee with an opportunity 

to consider and discuss its amendment to assure personal injury 

and wrongful death victims more just compensation. 

Thank you very much, and I would be happy to answer any questions. 

[The prepared statement of Mr. Galligan follows:] 

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PREPARED STATEMENT OF THOMAS C. GALLIGAN, JR. 


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Mr. CONYERS. I invite Ranking Member Lamar Smith to begin 

the questions. 

Mr. SMITH. Thank you very much. I know we have a vote coming 

up, and so I won’t use up all of my time. 

Let me direct my first question to Mr. Willis. 


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And Mr. Willis, I just want to confirm what I believe BP’s position is, and that is that you don’t feel that taxpayers should pick 

up any of the cost of the oil spill, is that correct? 

Mr. WILLIS. Representative Smith, we are going to pay all legitimate claims associated with damages caused by that spill. We are 

going to pay for damages to people’s livelihood. We are going to pay 

for lost wages. We are going to pay all claims that are substantiated. 

Mr. SMITH. I understand. 

Mr. WILLIS. We are going to pay all claims that are reasonable 

and necessary. 

Mr. SMITH. And you don’t feel that taxpayers should pay any of 

the costs attributable to the oil spill? 

Mr. WILLIS. I’m sorry, I didn’t hear your question. 

Mr. SMITH. You don’t feel that the taxpayers should pick up any 

of the cost of the oil spill? 

Mr. WILLIS. We realize that we are going to be judged by our response to the spill, and we will pay for all damage that has been 

caused that is directly related to this spill to people, to governments, to communities. 

Mr. SMITH. And BP, not the taxpayers? 

Mr. WILLIS. BP is going to pay for all damages that have been 

caused by this spill. 

Mr. SMITH. Thank you, Mr. Willis. 

Mr. Foley, I was going to ask you if you felt that the liability cap 

needed to be raised. I think you have actually explained very well 

in your opening remarks why that is not necessary and why people 

can still be adequately compensated. So let me go to Attorney General Hood and ask you a question if I may. 

Attorney General Hood, do you feel that your State of Mississippi 

has received all the equipment and permits that you need to address the oil spill from the Federal Government? 

Mr. HOOD. I am sorry, I couldn’t hear your question. 

Mr. SMITH. I am speaking into the mike. Do you feel that the 

State of Mississippi has received all the equipment and permits it 

needs from the Federal Government in order to adequately address 

the oil spill? 

Mr. HOOD. Yes, sir. We have been satisfied with the efforts of the 

Federal Government. And BP gave $25 million to the State so that 

local governments could draw down the money to prepare for this 

bill coming. 

Mr. SMITH. So you have everything you need for equipment and 

permits from the Federal Government? 

Mr. HOOD. Yes, sir. 

Mr. SMITH. Mr. Willis, last question. You have a background in 

oil exploration. Do you feel that we should consider limiting or 

eliminating all offshore drilling? 

Mr. WILLIS. By training, I am a geologist. I grew up on the Gulf 

Coast. Born and raised in New Orleans, Louisiana. Spent many 

summers in Biloxi and Bay St. Louis, Pascagoula, and when my 

folks had a lot of money, we actually went over to Destin. I actually 

studied in the marshes of Louisiana, and I realize that there is a 

very delicate existence in Louisiana in particular between the oil 

industry and the fishing industry. I have family members who 

139 

work in the oil industry who love to fish. One of my uncles who 

worked in the oil industry taught me how to crab. I think they can 

both exist together. 

Mr. SMITH. Both offshore exploration and fishing and crabbing. 

Mr. WILLIS. Yes. 

Mr. SMITH. Thank you, Mr. Willis. 

Thank you, Mr. Chairman. I yield back. 

Mr. CONYERS. Chairman of the Constitution Committee, Jerry 

Nadler. 

Mr. NADLER. Thank you. 

First of all, let me just say that I hope we can have Attorney 

General Hood back here before this Committee to really explore the 

issues he raised about the class action suits; about Federal courts 

removing these cases, perhaps not properly; and about why it is so 

bad in the Federal court, in any event. Even if it is removed, why 

should you get less justice in a Federal court, which obviously you 

think you do, than in a State court? So I hope we can examine that 

at a subsequent occasion. 

Let me ask Mr. Willis, does BP have sole liability for damages 

caused by the use of dispersants as well as by the use of oil? 

Mr. WILLIS. Sir, my involvement to date in response to the oil 

spill has been directly associated with the claims process. 

Mr. NADLER. Fine. If someone files a claim, I got sick from 

breathing air made poisonous by the dispersants, would you award 

that person an award? 

Mr. WILLIS. We have an open claims process, and anyone who 

feels like they have been damaged or hurt or harmed directly by 

this spill has every right—— 

Mr. NADLER. Directly by that spill. Does that mean the 

dispersants or only the oil? Are we going to have to determine 

Jones got poisoned by the oil, but Smith got poisoned by the 

dispersants, and therefore you are not liable; or are you willing to 

tell us it doesn’t matter, you are willing to cover people who got 

sick for any cause? 

Mr. WILLIS. What we are going to do is follow the law. 

Mr. NADLER. Do you feel that the law—do you feel that the law 

covers the dispersants or only the oil? 

Mr. WILLIS. I am not an attorney, but I will tell you that we have 

a claims process. It can be accessed three ways—through a 1-800 

number—— 

Mr. NADLER. Stop, stop. You are wasting my time. I am not interested in the fact that you have a claims process, that it can be 

accessed. We know that. The question is: What will you respond to 

in the claims process? Can anyone answer these questions? 

Mr. WILLIS. I will tell you what we will respond to in our claims 

process. 

Mr. NADLER. What kind of claims? 

Mr. WILLIS. To date, as I mentioned in my testimony, we have 

paid over 13,000 claims. Some of them have been for lost income. 

Some of them have been to fishermen. 

Mr. NADLER. I am asking a different question. If someone 

breathes in air on the Louisiana coast and claims that that air is 

poisoned as a result of the dispersant, and can show that that is 

the case, is that a valid claim in your process? 

140 

Mr. WILLIS. They can file a claim, yes. 

Mr. NADLER. I didn’t ask if they can file a claim. I have said if 

they can prove that claim that they are poisoned because of the 

dispersants, is that a valid claim that you will pay? 

Mr. WILLIS. Every claim will be evaluated—— 

Mr. NADLER. Can you answer yes or no, please? Do you consider 

poisoning by the dispersants your responsibility? 

Mr. WILLIS. What I am telling you, sir, is that we will evaluate 

every single claim that we get. 

Mr. NADLER. I know you will evaluate it, but you are evading my 

question. Let me read you something. I will read you a different 

question. Fishermen responders who are working BP’s giant uncontrolled slick in the gulf are reporting bad headaches, hacking 

coughs, stuffy sinuses, sore throats, and other symptoms. The Material Safety Data Sheets for crude oil and the chemical products 

being used in the dispersants list these varying ailments as symptoms of overexposure to volatile toxic organic carbons, hydrogen 

sulfide, and other chemicals boiling off the slick. 

BP is not offering people respirators. We just finished in the 

other room 2 days ago voting on $10.5 billion to compensate people 

who are poisoned by breathing in toxic air after the World Trade 

Center disaster because the Secretary of—the head of EPA at that 

time lied and said there were no ill health effects and the air was 

fine. 

I very much fear we are recreating the same thing right now, 

and that BP—and I have a whole group of stories here. Seven people admitted into the West Jefferson Medical Center in New Orleans, receiving treatment for having contact with dispersants. Marine toxicologist Riki Ott said the chemicals used by BP can wreak 

havoc on person’s body, even lead to death. Like other cleanup 

workers, Jackson, had attended a cleaning class and was told not 

to pick up oil-related waste. But he wasn’t provided with protective 

equipment. The BP officials told us if we ran into oil, it wasn’t supposed to bother us, which is clearly untrue. 

I fear that what BP is doing now is going to get thousands and 

thousands and thousands of people sick, maybe dead. And my question is: Do you undertake the responsibility—not to evaluate the 

claims. Do you recognize that the toxic air produced by the oil and 

by the dispersants can make people sick, and it is your responsibility, yes or no? And what will you do to prevent this from happening, since you are obviously allowing and requesting people to 

work without proper protection? 

Mr. WILLIS. I realize and I understand your question. We have 

received as a part of our claims process claims related to bodily injury. However, OPA does not contemplate personal injury, but as 

a part of our claims process, we will accept those claims, we will 

evaluate those claims, and we will address them as they come in. 

Mr. NADLER. But in your evaluation are you going to reject them 

because they are caused by dispersants, not by oil? That is the real 

question. Are you going to protect the workers, or are we going to 

recreate thousands of people who are sick and who we are going 

to be debating a few years from now how to compensate? 

141 

Mr. WILLIS. We are going to do the right thing. We are going to 

respond to this in an effective manner. And we realize we will be 

judged on our response. 

Mr. NADLER. I will just observe, since my time has expired, that 

the answers are totally unresponsive to the questions. And I hope 

that after this hearing you can get us answers to the specific questions I ask. One, do you accept responsibility for the poisoning of 

people by the dispersants in the air or the water as well as by the 

oil, or is that not direct under your definition? Two, what steps will 

you take to make sure that the people working on the recovery are 

not poisoned, as is now clearly happening to them? I hope you can 

get direct answers to those questions and not simply say, we will 

evaluate it. 

Mr. CONYERS. Senior Member of the Committee Howard Coble. 

Mr. COBLE. Thank you, Mr. Chairman. 

I thank the panelists again for appearing here today. 

Mr. Willis, let me put a procedural question to you. If a claimant 

submits a claim for immediate compensation, and compensation is, 

in fact, afforded, is that claimant permitted to subsequently submit 

claims if the damages are increased? You don’t require a release 

upon delivery of the first response to a claim, I guess is the question. 

Mr. WILLIS. Just to make sure I understand your question, you 

are asking whether a release is required when the first claim is delivered? A release is not required. 

Mr. COBLE. I assumed that. Thank you, sir. 

Mr. Attorney General, Mr. Hood. Mr. Hood, in your testimony 

you suggest that State actions related to this oil spill should not 

be removable to the Federal court. Now I am told, and I may be 

wrong about this, that tort reform advocates rate Mississippi at or 

near the bottom of their ratings in every category study. Now, why 

should we bar removal related to this spill if, in fact, Mississippi’s 

liability system is a poor record? It may not be a poor record. My 

information may be flawed. What do you say to that? 

Mr. HOOD. I suspect that the information that you have is probably biased. 

Mr. COBLE. I have been the beneficiary of biased reports as well 

as you have. 

Mr. HOOD. You see, you have Florida, you have Texas, Alabama, 

and Louisiana. You have all our States that our attorneys general 

want to bring our actions in our State courts and have the Federal 

judiciary recognize that we are a separate sovereign. We will be 

making claims under our Clean Water Acts, under our Coastal 

Wetlands Protection Acts. We are trying to recover resources for 

our States. If we get thrown into a mass tort action in Houston, 

Texas, we won’t recover all that we are owed. That is all we want— 

all we are owed—and nothing else. 

Mr. COBLE. Thank you, sir. 

Mr. Lemmer, let me put a two-part question. Has Cameron International made an assessment yet as to whether it is exposed in any 

liability under the Oil Pollution Act, A? B, what is Cameron International’s previous experience with malfunctioning in its blowout 

preventers? 

142 

Mr. LEMMER. Congressman, the answer to the first one is we believe we are not a responsible party under OPA; that that is initially BP and, as we heard today, Transocean. We don’t believe 

that we are. 

With respect to the history of blowout preventers, they have performed excellently over the years. They have gone from the surface 

to shallow waters to deep water, and we have never had an incident like this before. 

Mr. COBLE. Thank you, sir. 

Mr. Foley, I think you touched on this in your statement, but if 

you will discuss briefly the civil and criminal penalties that are relevant to this spill under OPA and other environmental laws. 

Mr. FOLEY. There are civil and criminal penalties under the Federal Water Pollution Control Act for the negligent release of oil, 

and the penalties are on a per-day, per-barrel basis. And there are 

no limits of liability with respect to those criminal and civil penalties. In addition, there are several Federal statutes that are used 

criminally to prosecute in oil discharge cases for environmental 

damage, such as the Migratory Birds Treaty Act for oiling birds. 

That is a strict-liability statute. There are a number of others. I 

don’t have them all listed here. 

Mr. COBLE. Thank you. 

Mr. Chairman, I want to join my colleagues in extending condolences to those who did lose loved ones in this tragedy, and I yield 

back the balance of my time. 

Mr. CONYERS. Crime committee Chairman Bobby Scott. 

Mr. SCOTT. Thank you, Mr. Chairman. 

Mr. Willis, there are number of different areas in terms of direct 

and indirect and even remote losses. If a seafood processing plant— 

if a waterman can’t work because the seafood has been damaged, 

seafood processing plant has nothing to process, they would be losing money. Workers who work with these plants could lose their 

jobs because there is nothing to do. A restaurant may not able to 

get seafood, so they would lose money in terms of sales, and the 

waiters would lose their jobs because the restaurant is closing. 

Even the local movie theater might suffer losses because nobody in 

the neighborhood is working. 

Who sets the standards on who gets paid in all these situations? 

Mr. WILLIS. Congressman Scott, the starting point for the standard is the law. And it is OPA, which was established by Congress 

for these types of situations. What we are doing is following that 

law in terms of damages, in paying for damages that are directly 

related and directly caused by the spill; paying for losses of income 

that are directly caused by the spill; paying those claims that have 

been substantiated, those costs that are reasonable and necessary 

as damages have been described in OPA. We are actually being 

guided by how the Coast Guard has interpreted this law for the 

last 20 years. 

Mr. SCOTT. Now, can we get periodic reports as to what is actually being paid so that we can get an idea of what is getting paid 

and what isn’t getting paid? 

Mr. WILLIS. Yes, sir. As a matter of fact, every day we provide 

the Coast Guard with a report by State, by type of claim. 

143 

Mr. SCOTT. Now, there have been allegations of fraud, misrepresentations, pressure, and everything else. Let me ask the attorney 

general. This is a Judiciary Committee, and we are trying to figure 

out what kind of damages and liability there ought to be. What 

kind of standard should there be for punitive damages and criminal 

liability? 

Mr. HOOD. That is, of course, going to depend on what the facts 

are in this case. If we find that there was gross negligence, that 

they should have taken some action that they did not, then that 

would elevate it to the level of punitive damages, which are available under some of our separate State actions. 

As far as a criminal investigation, it will be up to the Department of Justice. That will be outside of our State jurisdictions to 

make that decision. And I am aware that it is being looked into 

from a possible criminal angle. But the facts will have to lay that 

out, and I am not really able to lay out any particular standards 

that will require for either of those causes of action to occur. 

Mr. SCOTT. Mr. Chairman, I yield back. 

Mr. CONYERS. Steve King, Ranking Member of Immigration committee. 

Mr. KING. Thank you, Mr. Chairman. 

It has been an interesting panel of witnesses here this morning. 

Listening to the testimony and the questions that have been asked 

by the Members of this Committee, I hear the reflection of what 

was said and done up at Ground Zero in New York City as if that 

might inform us as to what we might do here. I would recognize 

that we can’t have any ex post facto laws, and whatever is in place 

now I believe should be what controls the liability. I don’t intend 

to support anything that is going to do something retroactively. I 

hear a tone of something otherwise, and I am not going to try to 

quote some Member on that. I just want to make that point. 

As I listen to the panel, it occurs to me that I haven’t heard what 

went wrong. Of all the experts we have, is there anyone on the 

panel that can tell us what went wrong down hole? 

Let the record reflect that there isn’t an answer right now to 

that. 

I will perhaps direct my question to Mr. Willis then, and that 

would be: Would it be reasonable, in your opinion, that before this 

Congress passed judgment on what mistakes were made by which 

entity, that we should determine what went wrong before we actually took some action to try to fix something? 

Mr. WILLIS. I am not sure I understand your question. 

Mr. KING. We have got a blowout preventer that apparently 

failed. We don’t seem to know why. We don’t know if there was a 

super-high-pressure gas bubble down there. I don’t have any measurements of pressure. I don’t know what went in the hole for mud. 

I don’t know if it was replaced with seawater. I don’t know what 

the control was of the blowout preventer. All those things down 

hole, I haven’t seen those reports from BP or anybody else. I hope 

you are forthcoming with that data and that information so we can 

find out what you may know that you have not yet told America. 

I see a whole Congress that is wrestling with this. I see hearings 

all over the Hill. There is a lot of media focus. It is on every day. 

But yet we haven’t focused—the first thing I believe that we should 

144 

do is find out what went wrong. We don’t know. Is there information that BP has that America would be interested in, do you think, 

Mr. Willis? 

Mr. WILLIS. Congressman, all I can tell you is since April 29, my 

focus has been making sure that the people that have been hurt 

in Louisiana and Mississippi and Alabama and Florida by this spill 

are compensated for their losses in real time. That has been my 

total focus. 

Mr. KING. Mr. Ferguson, representing Halliburton, I presume 

you were involved in preparations to cement the well. 

Mr. FERGUSON. The company was on the well, yes. 

Mr. KING. You are here as an expert not on the geology of it, but 

the legality of it. 

Mr. FERGUSON. That is right. 

Mr. KING. So that is where I am going to run into my blank here, 

and I just turn this into a statement rather than a question. I will 

just say, Mr. Chairman, to the members of this panel, I have great 

difficulty going down a path of trying to determine how Congress 

might deal with potential liabilities or what kind of message we 

might like to send if we are unable to actually determine what 

went wrong. 

Holding people accountable for something that may have never 

been encountered before geologically occurs to me to be a little bit 

premature. I would like to have done this examination on the other 

side of the geological report that hopefully we will get; the technological report that will come from BP, from MMS, from Halliburton 

and other companies that are involved, and at that point we can 

be objective. But I think it is premature to be at this point in this 

testimony that is here today. And I am going to turn my focus on 

figuring out what went wrong, learning what went wrong, and at 

that point start to put some of my conclusions together on whether 

Congress needs to act and how we might do that with the best 

amount of judgment. 

So I would just thank the witnesses for coming to testify today, 

and yield back the balance of my time. 

Mr. CONYERS. Mel Watt, senior Member of the Judiciary Committee. 

Mr. WATT. Thank you, Mr. Chairman. 

And I don’t disagree substantially with what Mr. King has said. 

It is unusual. But it is interesting that people are already starting 

to point the finger at each other. 

Mr. Lemmer, I take it you all have already concluded that your 

blowout prevention system didn’t cause this accident. You have testified to that affirmatively. Yet you have also testified that as soon 

as this occurred, you had people down there investigating and 

doing what was necessary to respond. 

So I guess the first question I have picks up where Mr. King left 

off. Has anybody made any preliminary assessments of what did 

cause this? 

Mr. Lemmer, you seem to know what didn’t cause it. Perhaps 

you could tell us your theory on what did cause it? 

Mr. LEMMER. Congressman, at this point we don’t have the necessary facts to make that determination. 

145 

Mr. WATT. You made the determination that your company’s system didn’t fail. You must have made some kind of determination 

in order to be able to make that assessment. So what are the possible theories of how this occurred? 

Mr. LEMMER. First of all, Congressman, what I said is we don’t 

have enough information at this time to make any such determination. 

Mr. WATT. I don’t think you said that at all. I am looking pretty 

much at your testimony. You seem to have eliminated—in response 

to somebody’s question, you said your company doesn’t have any liability; it was BP and the other folks. So the question I am asking 

you is: What are—I mean, I am not asking you to tell me what 

caused this. What are the range of possibilities of what caused it, 

I guess is the question I am asking? 

Mr. LEMMER. First of all, I want to go back to the point. The 

question was about our liability under OPA. That is a particular 

statute, not liability in general under common law or other statutory law. 

Mr. WATT. I am sorry if I misrepresented what you said. Can you 

answer the question now? 

Mr. LEMMER. The theories have been well expounded on in some 

of the other hearings. They go anywhere from a catastrophe down 

hole where there was a failure—— 

Mr. WATT. We know there was a catastrophe now. Come on. 

Mr. LEMMER. Did the casing fly into the blowout preventer; did 

the casing hanger fly up into the blowout preventer; did the blowout preventer try to close on a tool joint? There are a number of 

instances that would prevent the BOP from closing. 

Then there are the issues of controls. From what I understand 

from reading the paper and watching 60 Minutes and whatnot, the 

attempt to close the emergency disconnect did not occur until after 

the explosion. It could well be, although we don’t know at this 

point—it could well be that that explosion cut the communication 

between the control and the actual operation of the BOP on the 

seabed. 

Mr. WATT. We got your theory. What about the Halliburton theory? Tell me why Halliburton is not responsible. 

Mr. FERGUSON. Like Mr. Lemmer, we do appreciate the investigations are still going on. 

Mr. WATT. I understand that. I am asking you what you think 

happened. 

Mr. FERGUSON. I can comment like Mr. Lemmer did that there 

were a number of things that were going on with this well. There 

were a lot of operations that were being done. There was a lot of 

equipment, and there were a lot of parts that were in the well that 

could have failed. The manner of doing the operations could have 

been a problem. Until the investigation is over with and we have 

seen all the facts, we just can’t identify which one of those. 

Mr. WATT. All of which would have been under the control, I presume, of BP, at some level. 

Mr. FERGUSON. BP is ultimately in control of the operation. 

Mr. WATT. Let me ask this question, Mr. Willis. There are already families of deceased people who died as a result of this incident. What efforts are you currently making to try to address the 

146 

needs of those families? Are you just waiting on the lawsuits to 

come and be resolved at the end of the process? 

Mr. WILLIS. Congressman Watt, the first thing I would say is 

that our heart go out to the family. 

Mr. WATT. I understand that, Mr. Willis. We all have that response. 

Mr. WILLIS. My understanding is that each company is addressing the needs and claims of its own employees and survivors. 

Mr. WATT. How many of those employees were employees of BP? 

Mr. WILLIS. None of them were employees of BP. 

Mr. WATT. Who were they employees of? 

Mr. WILLIS. M-I Swaco, Transocean. 

Mr. WATT. Transocean, where are you? What are you doing to 

address the needs of the survivors currently as opposed to just 

waiting on them to go in and prove whatever claim they may have? 

Ms. CLINGMAN. Yes, sir. Of the 11 lives that were lost, 9 of those 

were Transocean employees. And we do take, happily, responsibility for addressing the needs of those families. 

Mr. WATT. What are you doing right now? 

Ms. CLINGMAN. We have made the conscious decision to wait 

until after a memorial service our company held on this past Tuesday to hold any financial discussions with the families. We held the 

memorial with all of the families. 

Mr. WATT. So you are not taking any steps right now, other than 

waiting on the legal liabilities to be determined. That is what you 

are saying? 

Ms. CLINGMAN. No, sir. We waited until after the memorial and 

are now in touch with those families and/or their legal representatives. We have actually started that process before the memorial. 

We did not want to have any financial discussions until after the 

memorial. We thought it was inappropriate to interrupt the grieving process. 

Mr. WATT. To the extent that Mr. King has said we can’t do 

things retroactively, I agree with that, but we can inform ourselves 

about what the future state of law should be. And I would just remind my colleagues that in the upcoming financial regulatory reform debate, this same issue about to what extent the Federal law 

preempts all State law is the same preemption question. All national companies would like to have one national standard and 

never answer to any State law, be subject to any liability from any 

attorney general’s lawsuit, State attorneys general lawsuit. But you 

are going to get an opportunity in other contexts to address this 

same issue, and I hope we will remember this gentleman Mr. 

Hood’s testimony when we get there. 

I yield back, Mr. Chairman. 

Mr. CONYERS. Darrell Issa. 

Mr. ISSA. Thank you, Mr. Chairman. 

Ms. Clingman, obviously, the loss of employees’ lives are covered 

by more than just the caps that we are dealing with here today. 

I am not asking you to tell us about the settlement per se, but in 

overall terms what is the company’s anticipated dealing with the 

loss of lives, and is any part of it affected by the $75 million cap 

that we are discussing here today? 

147 

Ms. CLINGMAN. Yes, Representative. No, the $75 million cap that 

has been referenced applies only to OPA, which are environmental 

claims. That cap has nothing to do with our responsibility for our 

employees. They are, however, subject to the limitation of liability 

action that has been filed in Texas Federal court. How we address 

that depends on how those claims play out. 

What I can commit to you and to the families involved is that 

from our CEO down, we have testified and will proactively resolve 

those claims fairly, and we are at the very outset of that process 

now, but it is one of our top priorities. 

Mr. ISSA. The business of drilling rigs, whether on land or at sea, 

it is pretty dangerous business, isn’t it? 

Ms. CLINGMAN. I would say no more dangerous than many industrial workplaces. There are obviously a lot of risk factors in offshore 

drilling. It has been historically safe. Our rig involved here has not 

had a single incident for 7 years of even minor injuries on board. 

Mr. ISSA. Isn’t it true that on the very day that this disaster occurred, your people were receiving a safety award for its operation 

of that rig? 

Ms. CLINGMAN. Yes, sir. As ironic as that sounds now, the operation had been conducted so well and with so little safety or other 

concern, that there was being an award given, and executives were 

on board the rig that day for that purpose. 

Mr. ISSA. I am going to continue on with you, if you don’t mind, 

because there are too many to spread it around. Isn’t it true that 

you had concluded your basic drilling 2 days before? 

Ms. CLINGMAN. Yes, sir. Transocean was brought in to drill the 

rig by BP—it is a subcontractor—and that drilling had been completed on April 17, 3 days before the Deepwater Horizon incident. 

Ironically, we were in the process of concluding our work and were 

in the very short future going to remove the blowout preventer and 

the riser package and depart the well site, at the request of BP. 

Mr. ISSA. So going through that line of questioning, isn’t it true 

that the subcontractor for the concrete portion, Halliburton, was on 

site? 

Ms. CLINGMAN. Yes, sir. Halliburton as well as M-I Swaco were 

performing the cementing. 

Mr. ISSA. So we have British Petroleum that owns the lease. 

They have some oversight. We have at least three other contractors. You are in a transition phase. Is it a particularly dangerous 

time historically, this transition? 

Ms. CLINGMAN. It is a good question. And I would say generally, 

not being a drilling engineer myself, it is actually considered one 

of the more safe times. One of the things that is so astoundingly 

unusual about this incident is it happened after a well had been 

cemented and cased. Normally you would anticipate during the 

drilling process, as you are reaching different geologic depths, you 

would see greater risks from hydrocarbons emanating from the 

structure. Here the well had been cemented, cased, and concluded. 

So it is extraordinary, and I have heard that repeated from everyone in the industry, that there would be such a catastrophic failure. 

Mr. ISSA. So, going through that line of questioning for our edification, one, you are going to take care of your people based on laws 

148 

unrelated to our hearing here today. Two, your work had been completed; but, more importantly, there were multiple different folks, 

companies represented there. There is a whole series of logs, not 

all of which you probably have, that will have to be reviewed. The 

failing device may or may not have been the one that was inspected days before. The blowout preventer. The concrete is a factor 

of why and how it failed to perform. 

So summarizing it, we don’t know whether there was any failure 

that could have been anticipated. We don’t know, and we are not 

representing here Mineral Management Service, who has a primary responsibility to ensure that, and yet we are talking about removing a cap that may or may not apply based on whether there 

was or wasn’t wrongdoing by any of the companies represented 

here. Would you say that synopsizes what we are doing here today? 

Ms. CLINGMAN. I agree with many of the statements you have 

just made. It is incredibly difficult to try and either prejudge liability or responsive action that should have been taken. I am thrilled 

to hear the report that perhaps the well leak has been stopped. 

That will allow more resources to be dedicated to the investigation. 

I wholly agree that until we know the cause of the incident, it is 

completely inappropriate to start to assign blame or liability. What 

is important, I believe, today is that claims are being paid, and 

people who are injured are being taken care of. And that is my 

commitment. 

Mr. ISSA. I, for one, will be looking at how the companies handle 

their obligations, and obviously would like to have further research 

once there are more facts as to whether this was an inevitable 

event or something that could have been prevented by compliance. 

Mr. Chairman, I thank you for your diligence in this and yield 

back. 

Mr. CONYERS. We have now been called to some votes on the 

floor. We will take a recess. Mr. Brandon Johns will lead you and 

direct you to restaurants, delicatessens, restrooms, et cetera. 

The Committee stands in recess. 

[Recess.] 

Mr. CONYERS. The Committee will come to order. Thank you for 

your return. 

The Chair recognizes Sheila Jackson Lee, a senior Member of the 

Committee and chairwoman of the Transportation Security Subcommittee of the Homeland Security Committee. 

Ms. JACKSON LEE. Mr. Chairman, again, thank you 

for your leadership, and I thank this Committee for its wisdom 

in proceeding forward on what I believe is an enormously important process. 

I disagree with my colleague and friend who is not here from 

California about the order of things; determining what happened 

before you can address the question of liability. This is a tort action. Whether it is an accident or not, there will be degrees of negligence—gross negligence, willful—and there is a question of the 

form of liability and whether or not punitive damages are too low, 

exist, and how are you to structure what may ultimately be the 

largest tort litigation in the history of this Nation. 

One of the disappointments that I have, and certainly sad that 

we have come to this, is that we did not learn our lesson with the 

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incident in Alaska, the Valdez, if you will, in structuring a scheme 

that will be responsive to the potential catastrophic event that this 

is. This will go down in the history books. 

I recognize the value of those who are here. Allow me just to own 

up, because I do come from the energy capital of the world. And, 

frankly, the presence of BP is in Houston; the presence of 

Transocean is in Houston; the presence of Halliburton was in 

Houston. They are headquartered in Dubai, leaving a gaping hole 

in our economy. And, of course, the presence of Cameron International in Houston. So I speak now for a sense of balance for the 

jobs that are created. 

But I also come from a region that is not far from the Gulf Cost, 

and I recognize the vitality and the importance of the fishing and 

shrimping and oyster industry. And I have never found that industry to disturb the oil industry or the gas exploration industry. So 

why do we have a situation now where there is a constant referring 

that we are not ready to discuss liability when we have a whole 

entire industry shut down? 

First of all, I want to association myself with the past president 

of Plaquemines Parish, and I want the Federal Government to give 

them everything they need and let them be in charge to clean up 

what is an additional liability and is the horrific marsh or wetlands 

that are being literally destroyed as we speak. 

I have some quick questions for those who I have already extended my personal sympathy and concerns, and forgive me for just 

asking you quick questions so that I can focus on the question of 

liability. 

Mr. Jones, has any of these particular corporations come to offer 

you a settlement, sought you to sign papers, or brought any issues 

to your attention regarding the tragic loss of your son? 

Mr. JONES. Well, no. Nothing of the kind. I should say that MI Swaco, Gordon’s employer, has been very generous in their attention and their time. The day we knew Gordon was dead, the top 

five executives of M-I Swaco, which has its office in Houston, came 

to the house, sat around the dining room table and talked to us. 

Ms. JACKSON LEE. No one has asked you to sign a settlement 

agreement? 

Mr. JONES. I am sorry? 

Ms. JACKSON LEE. No one has asked you to sign a settlement 

agreement? You have not signed a settlement agreement? 

Mr. JONES. Oh, no, no, no. 

Ms. JACKSON LEE. If you will forgive me, I just wanted to try and 

precisely focus in on that. 

Mr. Brown, has anyone approached you to sign away your rights? 

Mr. BROWN. No, they haven’t. 

Ms. JACKSON LEE. Mr. Stone, I understand you were met in a 

store, a restaurant, and someone asked you to sign away or to say 

that you were not injured. Is that correct? 

Mr. STONE. Yes, ma’am. That was for the personal items lost on 

the rig. They reimbursed us for that. But there was also a waiver 

that said I was not injured and I wasn’t—— 

Ms. JACKSON LEE. Where were you located? Where was this 

meeting at? 

Mr. STONE. It was at a Denny’s. 

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Ms. JACKSON LEE. Did you have a physician there assessing you? 

Mr. STONE. No, ma’am. 

Ms. JACKSON LEE. Did you have a psychiatrist or psychologist assessing you? 

Mr. STONE. No, ma’am. 

Ms. JACKSON LEE. Did you have your own physician there assessing you while they were speaking to you? 

Mr. STONE. No, ma’am. 

Ms. JACKSON LEE. Did you have a lawyer there? 

Mr. STONE. No, ma’am. 

Ms. JACKSON LEE. Did it strike you as strange to be assessed as 

having not been injured by I don’t know whether it was a claims 

adjuster in a Denny’s restaurant? 

Mr. STONE. Yes, ma’am. 

Ms. JACKSON LEE. Can you tell me how soon that was, sir, after 

the occurrence? 

Mr. STONE. I think maybe a week. 

Ms. JACKSON LEE. Less than 2 weeks you were asked to sign a 

settlement. What company was that? 

Mr. STONE. I believe it is Shuman Consultants. I think it is 

Transocean’s insurance. 

Ms. JACKSON LEE. Thank you. 

Let me quickly try to answer these questions. First of all, in the 

Wall Street Journal today, they have mentioned three items that 

suggest that BP might have short-circuited, short-cut procedures 

that might have created the explosion, the rising gas. We are not 

here to determine that. That ultimately may be in a court of law. 

But quickly I go down to the companies that are involved: 

Transocean, BP, Halliburton, and the attorney general. 

Quickly, to the attorney general. If I can pursue this question 

quickly, what is the fix that you need—and if you can be very quick 

on that. Let me let you be last—the fix that you need on liability. 

To Mr. Willis, let me ask you directly, will you pay everything 

that is determined to be your fault to the maximum, including the 

environmental impact? Is BP prepared to pay it all? 

Mr. WILLIS. Representative Jackson Lee, BP is prepared to pay 

for all of the damage associated with the impact of this spill. 

Ms. JACKSON LEE. So that means health and safety, the oyster 

farmers and all to the maximum amount necessary to make them 

whole? 

Mr. WILLIS. We are going to do the right thing and—— 

Ms. JACKSON LEE. Without litigation? 

Mr. WILLIS. We are going to pay the damages caused by the spill. 

Ms. JACKSON LEE. Who will determine the damages; a court of 

law? 

Mr. WILLIS. The damages—I will give you an example. We have 

opened the claims process, and to date we have seen over 25,000 

people in our claims office. We have paid over 13,000 claims, and 

we are doing it every single day. 

Ms. JACKSON LEE. So what you are saying to me, and I guess the 

concern I have and I will have to pursue this later, is that you will 

pay the maximum, but the question is: Are you dumbing down the 

claims? I can’t get that answered. 

151 

Let me ask the Transocean representative, please, as to why you 

would have a representative in a Denny’s restaurant asking one of 

the victims to sign off on whether they were injured or not? And 

is this the mode of operations that you are doing to people who are 

now victimized, frightened, and without sufficient legal representation? Can I ask you to cease and desist this kind of method of approaching victims and asking them to sign away their rights? 

Ms. CLINGMAN. Yes, Congressman. That has not been our course 

of conduct. The circumstances of this particular meeting were on 

April 30, 10 days after the accident, a guy by the name of Mr. Steven McClellan, who is not a lawyer, met with Mr. Stone to give 

him the $5,000 that was paid to all persons on board, not in settlement of anything, but just for personal belongings on board. That 

was the standard amount paid out to employees. 

Ms. JACKSON LEE. But he understands you were trying to get 

him to sign away his release. 

Ms. CLINGMAN. No release was signed. I have no release on file. 

Ms. JACKSON LEE. I know. But he refused it. How many signed 

it out of fear, apprehension, and lack of knowledge? I am asking 

will you cease and desist putting forward these kinds of papers in 

front of anybody from now on? 

Ms. CLINGMAN. It is an easy answer to say yes because we have 

not done so. No one has been asked to file a release of Transocean. 

They were asked some basic factual questions to help our investigation. That has already been included. Some employees participated; some did not. None has been asked to or has signed a release of liability in connection with the incident. 

Ms. JACKSON LEE. Thank you. 

Halliburton, you were responsible for the cementing, which has 

been characterized as erroneous. Are there any existing liability 

that you now owe that you are not willing to pay, or are you willing 

to pay the maximum that may be required because of further determinations? 

Mr. FERGUSON. Well, we certainly are willing to honor any obligations that we have. 

Ms. JACKSON LEE. Attorney General Hood, I quickly need to finish with you and ask: What is the fix, and do we need to lift the 

$75 million liability, and do we need to have legislation to allow 

you to be in your State courts—Texas, Louisiana, Mississippi, Florida, and Alabama and others that may be impacted? 

Mr. HOOD. Yes, ma’am. Our recommendation is—and I have that 

attached to my comments, an actual draft of legislation—prevent 

removal of State causes of action when the State is the plaintiff. 

There is no respect in the Federal judiciary for the 11th Amendment any more. So we need to try to fix that. 

The Class Action Fairness Act, there were 47 attorneys general 

signed letters to Congress asking that we be excepted from the 

Class Action Fairness Act, and it was done because many said the 

States won’t be subject to it. Well, the fifth circuit said that they 

are. We need to amend that and expressly except the States. 

OPA 90. The States needs to be expressly excepted, although it 

is clear that the statute contemplates State concurrent jurisdiction. 

Federal judges have said, oh, that raises a Federal question; therefore you can be removed to Federal court. 

152 

The other would deal with the limitation of liability. We need to 

be excepted from that. Transocean has filed a limitation of liability 

before a Federal district judge in Houston, Texas, where they are 

trying—the Federal Government just got out of it yesterday, and 

we want out as well. And we believe it should be amended. It is 

just an antiquated 1851 statute where they are trying to drag us 

into Federal court. 

Lastly, rule F that applies to admiralty matters, we suggest that 

it be amended. 

So we just want to have our causes of action heard in the State 

court. 

Ms. JACKSON LEE. Over all, do you think that $75 million—speak 

for yourself, but there are other victims here, individuals—do you 

think that $75 million that was placed in law is too low? 

Mr. HOOD. I think it was. I think the industry had a tremendous 

impact of the drafting of that legislation in 1990, and I think it is 

too low. Certainly I am proud to see that BP committed in writing 

to five of us attorneys general they would not raise that cap. But 

we probably won’t be—we probably won’t even plead any actions 

under OPA because we are afraid some Federal judge is going to 

drag us out to Houston, Texas. And so we are probably going to 

just restrain and file State causes of actions. And so that OPA cap 

is somewhat—hopefully, won’t be applicable to the States. 

Ms. JACKSON LEE. Let me just thank the Chairman. 

If I might just point to Mr. Encalade, who I know will be questioned, but are you without income now at all, sir? Are the 300 connected members of your community totally impacted right now, and 

do you see this as a long-range impact? 

Mr. ENCALADE. Congresswoman, 90 percent of the fishermen in 

our community are completely out of income, though there are 

questions about some oyster beds being open, available for harvest, 

but the conditions are horrible. These fishermen also take it upon 

themselves to have a responsibility to the public, and they are not 

going to go into waters that they may feel could cause harm. So, 

yes, 90 percent of them are out of work in our community. 

Ms. JACKSON LEE. Mr. Willis, can you help him? Can you help 

him right here today? Can you get to his location and deal with 

this harm? 

Mr. WILLIS. As a matter of fact, Representative Jackson Lee, I 

actually met Mr. Encalade in Louisiana about 7 days ago at a town 

hall in Port Sulfur. I was on the phone last night with some folks 

who are working on the ground for BP in Pointe a la Hache, the 

community that he is describing. We have a claims office that we 

located in Pointe a la Hache. We have a community outreach center that we opened in Pointe a la Hache. We are seeing people 

there. We are bringing checks to them in Pointe a la Hache if they 

can’t come across the water to our office in Venice. We are working 

with that community. As a matter of fact, I have personally written 

a check on behalf of BP for the food pantry in Pointe a la Hache, 

given the fact that so many people in that community rely on that 

water in Louisiana to make their living. 

In that area, in Plaquemines Parish, we have paid over 1,000 

claims. The claims office, as a matter of fact, Representative Lee, 

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in Venice, which is not too far from Pointe a la Hache, I was physically there and opened it myself. 

Ms. JACKSON LEE. I am going to yield back. I just want to make 

sure that you are not making these farmers, these fishermen sign 

any of their rights away to get a minimum baseline check to help 

them get bread, water, and fruit. 

Mr. WILLIS. Absolutely not. 

Ms. JACKSON LEE. All right. I yield back, Mr. Chairman. 

Mr. CONYERS. Senior Member Trent Franks, Ranking Member of 

the Commercial Law committee. 

Mr. FRANKS. Thank you, Mr. Chairman. 

Mr. Chairman, I want to begin by offering my sincerest and 

warmest condolences to the people who have lost loved ones in this 

tragic event. 

As it happens, unlike most of the Members of the Committee, I 

have been intrinsically involved in this industry, having started out 

when I was a very, very young man working on a drilling rig. I am 

familiar with the Transocean Drilling Company. I am familiar with 

Halliburton. They have actually cemented wells that I have been 

on. And I have owned Cameron blowout preventers. So this is 

something that I am very familiar with. 

I guess in some ways that is a little bit of a disadvantage to me, 

Mr. Chairman, because I understand the very difficult nature of 

going out into the middle of the ocean, a mile off the ocean floor, 

and drilling the total from top to bottom of 18,000 feet and recognizing some of the horrific bottom hole pressures there that are 

dealt with. I know that it is a very difficult environment. 

We always used to hold up roughnecks as some of the toughest 

guys in the world because they had the courage to go out there and 

make that happen. So there is sort of a brotherhood that I feel toward some of the people that have done this kind of work. 

And again, I understand there is just the intrinsic risk involved. 

It is not easy. Part of it, I will say, perhaps it will sound political 

but I don’t mean for it to, part of it is that a lot of the major companies they would like to be drilling onshore, because it is about 

one-tenth as expensive if they could find the reserves and the opportunity to do that, but a lot of times they can’t, and they are 

forced offshore and it is in an extremely difficult environment. 

So when I ask these questions here, I don’t know how long I am 

going to be offered here, but I am not trying to assign anything because I think one of the things that has been mentioned earlier 

today is we do not really know all of what happened. There are a 

few who do. But I do know that the primary protections against 

horrific bottom hole pressures in this case, if it is 18,000 hydrostatic gradient alone would probably be over 8,000 pounds per 

square, which is a volcano that very few people understand when 

it is completely unleashed, the destruction of the drilling rig is 

probably some sort of and example to people. 

But having said that, there are two main protections that one 

has against the pressures like this, and that is the weight of the 

column of drilling mud, the drilling fluid and, of course, the blowout preventer if that fails. And I am told that that there was a 

small boat that they said it felt like it was raining and it looked 

like black rain. 

154 

I am absolutely convinced that was drilling mud that was blowing out of the hole at the time. Of course, a roughneck knows that 

when drilling mud blows out of the hole, that it is time to leave 

the premises. And I know that 11 people didn’t get off in time, and 

again, I offer my most profound apologies and condolences, because 

I lost a very, very dear friend on a drilling rig at one time. 

And in one case in my earlier life, there were five men that I 

knew not working for me at the time, but five men that I knew 

that were killed within a space of a month in the Texas oil fields 

drilling to the Ellenberger shallow 4,000 foot or less. So I know this 

is a very hazardous environment. 

With that said, rather than my trying to talk about liabilities 

here, I would like the try to figure out a little bit about the echelons of the engineering process that took place. I am assuming that 

somehow the drilling column was diminished in density, whether 

it was mixing with seawater or something along those lines when 

they were staging the cement job, I am guessing, that happened, 

and I am not suggesting that I am just guessing it, but I guess I 

would ask, I know that Halliburton, Halliburton has worked for me 

at times and they have always done a fantastic and very professional job. But I know that sometimes they are sort of a team of 

engineers; it is sort of a joint effort between the Halliburton engineers or the cementing engineers and the engineers that worked 

for BP or the ones that worked for the operator, or, in some cases, 

the contractor hasan engineer too, but can anyone on the panel— 

it asks for a lot of courage, I suppose, but can anyone on the panel 

give me some idea of what the engineering protocol was there? 

Who was in charge of the cementing process at the time? Again, 

I am talking about who was the ultimate last word in the process? 

And I probably should ask the Halliburton representative first. 

Mr. FERGUSON. Yes, sir, I can’t really go into all the technical details of it, but I can say that we did the cement placement on this 

well. We have an engineer who specializes in cementing who is actually in the BP offices in Houston. What we will do is they will 

come to us and they will ask us they will give us information on 

the well and on the temperatures and on the type of pressures and 

that sort of thing. 

Mr. FRANKS. Were they able to give you a bottom hole pressure? 

Mr. FERGUSON. We get a lot of different information from them 

in the beginning. It is that way on all wells. We don’t go down and 

we don’t have any way to get that ourselves. We get that information, we design what we feel is a good cementing program for that. 

We make proposals to them. It goes back and forth. There are a 

lot of other elements of the cementing process that is really controlled by the well owner on the rig that we don’t have any control 

over, but we can run computer simulations and tell them if you do 

this, then it looks like you are going to have a certain result on the 

cement at the bottom. 

And you go back and forth with that until such time that the 

owner decides what they are doing to do. And then at that point 

they go ahead and conduct the operation. 

Mr. FRANKS. But BP’s engineers, I have never worked for BP but 

their engineers are the ones that essentially had the last word, and 

155 

Halliburton engineers probably gave them their volumetric calculations and their projections. 

Mr. FERGUSON. Certainly we do that. We even give them computer simulations, if you run it this particular way, this is likely 

to be the result, and it gives them charts and shows them how it 

looks. 

Mr. FRANKS. That makes sense. Mr. Chairman, if you will indulge me again, the two aspects of this is the weight of the column 

of mud which did blow out. There was some miscalculation there. 

It could have been a methane bubble, whatever, something happened that the hydrostatic pressure of the drilling column became 

less than the bottom hole pressure, and that is what caused the 

blowout. 

So if you will indulge me to ask the Cameron representative, I 

have owned Cameron blowout preventers, and I am guessing that 

this probably had a blind ram, and probably a pipe ram and a 

shear ram, and there has been some discussion that the shear ram 

hit a joint which is a much heavier element of the pipe and didn’t 

shear it. And I am wondering is that, first of all, I guess I would 

ask you, are my conclusions, were these three or four rams present 

in the Cameron stack blowout preventer? 

Mr. LEMMER. Congressman, yes, there were four rams. One was 

a test ram, there were a couple pipe rams, a shear ram, and I think 

there was an annular also. We don’t know what happened, why 

this didn’t work. One theory is it could have hit a pipe joint, but 

we don’t know that for a fact, and we won’t until we can retrieve 

it. 

Mr. FRANKS. I understand that. And I fully embrace that because 

I think it would be speculation on anyone’s part at this point especially since you probably lost communication with the BOP at the 

time when the rig, when it blew out. Am I correct in assuming that 

you probably had some sort of a hydraulic actuator and an electronic actuator and perhaps even a dead man switch on the BOP 

and that you probably lost contact with all of those, or at least the 

floor of the rig lost contact with all those when it went in the 

ocean. 

Mr. LEMMING. Again, we don’t know. We assume that the EDS 

lost contact, electrically or communications. We are not sure whether it lost it hydraulically or not. For the dead man to fire it requires all three to be lost. So the EDS could not work if the power 

is gone or the communication capabilities are gone, but if the hydraulics stay in place, then it doesn’t get the message to fire, but 

neither does the dead man work because all three weren’t cut. 

Mr. FRANKS. One last thought, Mr. Chairman. A lot of the blowout preventers I have used have a nitrogen accumulator to actuate 

the closing the preventer or hydraulics. In this case, what was the 

actual energy source to close the blowout preventer? Was that 

something, was that sort of a accumulator on the ocean floor? 

Mr. LEMMER. This is way beyond my area of competence but I 

understand that there were multiple accumulators on this BOP. 

Mr. FRANKS. Mr. Chairman, I guess I will stop there. 

Again, my condolences first and foremost to those who lost their 

lives and to those who have been left behind. It is a very, very difficult challenge, meeting the energy needs of this country, and I 

156 

know that there will be, in my judgment, personal and human 

error discovered here, or at least miscalculation, and those will 

have to, those things will have to bear out as they will. But I guess 

I would remind all of us that we only produce about 40 percent of 

our own oil in this country, and the 60 percent that we buy, some 

of that finds its way into terrorist coffers and so there are big implications here to losing our ability to produce our own energy. 

And certainly countries like Iran and Saudi Arabia will probably 

be less inclined to curtail their drilling operations because of a 

tragic accident. 

And I hope we can do whatever is necessary to make sure this 

never happens again. But we should not lose sight of the fact that 

there is a very challenging environment like so many other things 

in this enterprise of humanity. And thank you, Mr. Chairman, for 

indulging me. 

Mr. CONYERS. Senior Member, Maxine Waters, chair of the Housing Committee and Financial Services. 

Ms. WATERS. Thank you so very much, Mr. Chairman. First, let 

me say to Mr. Jones I am just so sorry about the loss of your son. 

I thank you for being here today. And to Mr. Brown, I am pleased 

that you survived, but I am so sorry about what you have had to 

go through and what you are still going through. And Mr. Stone 

and all of the families, I am just terribly pained about the loss of 

all of the personnel and the harm that has been caused in what 

I think will be the greatest ecological and geological disaster in the 

history of this country. 

I had wanted to spend some time with you, Mr. Encalade, to talk 

about the history of the Black oyster fishermen down there, but I 

want to pass over that for a moment because BP is here today represented by Mr. Willis saying all the right things about what all 

they are prepared to do, and all the responsibility that they are 

going to accept. But I can’t trust that. I can’t trust that because 

of the history of BP that we have learned about since this disaster 

has taken place. 

Over the past two decades, BP subsidiaries have been convicted 

three times of environmental crimes in Alaska and Texas, including two felonies. It remains on probation for two of them. It has 

also received the biggest fine for willful work safety violations in 

the U.S. history, and is the subject of a wide range of safety investigations, including one in Washington State that resulted in a relative minor $69,000 fine for 13 serious safety violations at its Cherry Point refinery, Ferndale, Washington. 

As a matter of fact, a review of BP’s history shows a pattern of 

ethically questionable and illegal behavior that goes back for decades. BP’s best known disaster took place in 2005 when an explosion at its refinery in Texas City near Galveston killed 15 workers, 

injured 180 people and forced thousands of nearby residents to remain sheltered in their homes. 

An investigation of the explosion by the U.S. chemical Society 

and Hazard Investigation Board blamed BP for the explosion and 

offered a scathing assessment of the company. It found organizational and safety deficiencies at all levels of the BP Corporation 

and said management failures could be traced from Texas to London. It goes on and on and on. The company eventually pleaded 

157 

guilty to a felony violation of the Clean Air Act and was fined $50 

million and sentenced to 3 years probation. The Occupational 

Health and Safety Administration assessed BP the largest fine in 

OSHA history, 87 million, after inspectors found 270 safety violations that had been previously cited but not fixed, and 439 new violations. BP is appealing that fine. 

But BP’s legal and ethical problems go back much further. So we 

don’t trust you. We don’t trust what you say. We are watching 

what you do. 

And I want to tell you that some of us are dedicated to the proposition that we are going to see that the people in communities that 

have been harmed get compensated and get compensated generously, and that we are prepared to do whatever we have to do to 

make sure that that happens. 

And I want to tell you further as this disaster has occurred, 

when you first set up your claims offices and you are here to talk 

about claims, Mr. Willis, and you are talking about what you did, 

you didn’t have a claims office that was in the minority community 

and in this village that Mr. Encalade comes from here today. They 

had to fight for that. And we also know that there was some attempt to have people sign settlements rather than claims. 

So we don’t trust you. 

And I want you to know that in addition to the lack of trust that 

we have, we have people that we have had to organize who have 

organized themselves to come here today to be of assistance to Mr. 

Encalade in this testimony. We had to—Minister Edwards, he has 

to get all involved in this. 

Mr. Encalade’s son-in-law had to stop what he is doing, get all 

involved in this; young attorneys out of New Orleans that we have 

been working with because we had the same kind of situations 

where the small people were not being taken care of after Katrina 

that had been working with this situation, and they are doing it 

as volunteers. You aren’t paying for any of that. 

As a matter of fact, did you ask Mr. Encalade how he got here 

today? Halliburton? BP? Any of you rich corporate guys, do you 

know who paid their way here today? How they got here? And the 

people that accompany them? Would you ask them after this Committee hearing, and would you offer to be of assistance to them so 

that these people, especially Mr. Encalade, who has lost 90 percent 

of his income or all of it, would you assist him and in reimbursing 

him for the money he had to pay out of his pocket and all of those 

that accompanied him? 

We have to tell you that we want to see better efforts and better 

work if you want us to believe you when you come here. Why do 

we have to keep struggling and fighting? Is it true, Mr. Encalade, 

that you all had to go and fight because you had to travel 300 miles 

to get to the claims office? 

Mr. ENCALADE. Yes. Congresswoman Waters, yes. That is true. 

We had no claims. We had anything and it is something that I 

think BP still doesn’t understand. You know, food stamps and welfare is fine for elderly people that are home that cannot support 

themselves that is living off of $500 a month. These fishermen 

work hard. They have boats that values in excess of 100- 

somethousand dollars, they have oyster beds, they work bedded, 

158 

and everything. I don’t feel I should have to go up to a food stamp 

office to get food stamps to support my family for something that 

was out of my control, I had no doing with, for someone else to put 

me out of business. 

And I say we live in a country that I love dearly. I am a veteran 

and I know anywhere if we did harm to any country or any citizen 

in another country, we would have to pay it. The United States 

Government would take care of that family just as we have done 

in the past. And what I am saying is no I am sorry, we are a proud 

people. Food stamps and welfare belongs with people that cannot 

feed or work or take care of themselves. We are proud people. 

Ms. WATERS. Mr. Willis, I just reviewed your claims process. And 

I understand that people are calling in, they ask for certain information, and they don’t send a claims adjuster out. They ask the 

people to come in there to the claims office. And you are basically 

getting 5 grand or $2,500, but what about, is that some kind of 

temporary holding compensation until there is an assessment done 

of the total damage that has been done to the individual? How does 

that work? 

Mr. WILLIS. I am happy to answer your question, Representative 

Waters. And I wanted to start by just saying that in Louisiana 

alone, of the claims we have paid, over 60 percent of the moneys 

that have been paid out to date, over 60 percent of the 35 or so 

million, the $37 million has been paid in Louisiana. We paid a total 

of—— 

Ms. WATERS. Just tell me how the claims process works. 

Mr. WILLIS. How the claims process works, we have three ways 

that the claims process can be accessed. It can either be accessed 

through our 1-800 number, which is 1-800-440-0858. That number 

is available 24 hours a day 7 days a week. People can go online 

and file a claim at www.bp.com/claims, or they can walk into one 

of our claims offices. As I mentioned in my testimony, we have a 

total of 24 claims offices open to date, nine of those in Louisiana. 

We have one in Venice, we had one in Pointe a la Hache—— 

Ms. WATERS. I know where they are. How do they work? 

Mr. WILLIS. The way they work is you go into an office, and if 

you are a boat captain or a fishermen, you bring in a tax return. 

If you don’t have a tax return, you can bring in payroll, pay stub 

for a month, you can bring in deposit slips, you can bring in boat 

tickets or shrimp tickets or anything that shows how much money 

you make for a month. 

What we have tried to do is not put a cumbersome process in 

place. When I got involved in this—— 

Ms. WATERS. Please, when you bring in all your documentation 

and it is agreed upon how much money can you receive? 

Mr. WILLIS. You will be fully compensated for your losses. But 

what we have done, Representative Waters, in order to expedite 

the process, this was a process that was initially going to take 45 

days to get a check into someone’s hands, we can do it in 48 hours 

now. And what we have done is bias the process toward getting 

money to people quickly, $5,000 for boat captains, $2,500 for deck 

hands. 

159 

Ms. WATERS. So you have this amount that you give that is a 

temporary and expedited process, and then the rest will come 

along? 

Mr. WILLIS. Absolutely. 

Ms. WATERS. In what length time? 

Mr. WILLIS. It is going to come along as we continue to evaluate 

the process. 

Ms. WATERS. You are not going out to do the adjustments, how 

do you figure out whether or not these claims are authentic. 

Mr. WILLIS. We will be going out to do the adjustments—— 

Ms. WATERS. You are going to do that before you give the rest 

of the money—— 

Mr. WILLIS. It is an ongoing process. What I was most concerned 

about, what BP has been most concerned about is getting the 

money into the hands of the people who are hurting and been hurt 

by this oil spill sooner rather than later. 

Ms. WATERS. Here is one of the problems. You can call your number and they will ask you for your Social Security number, they 

will ask you for a few other things. They will give you a claims 

number. Then they will ask you to come into the office, you will 

get the 5,000, but if you have got problems, your 1-800 number, 

573 8249 is not a 24-hour number and this is where we run into 

problems. You run into problems because people are trying to follow up to find out when the rest of their money is going to come, 

what other documentation they have to have, what do they have 

to do, but this is where you are going to have problems. Why isn’t 

that a 24-hour number also? 

Mr. WILLIS. It is—the number for the claims line—— 

Ms. WATERS. 1-800-573-8249, 8 a.m. To 8 p.m. Not a 24 hour 

number. That is the follow-up number. 

Mr. WILLIS. That is not a 24-hour number. 

Ms. WATERS. Why don’t you make it a 24-hour number? 

Mr. WILLIS. We will definitely do that. I can make that happen. 

Ms. WATERS. Mr. Chairman, as I wrap up, we have worked with 

the road home program from your beloved State, Louisiana. There 

are still people who have not been compensated. The system bogs 

down and it literally ignores small people, small people who don’t 

have money to go get lawyers to fight the bureaucracy. And that 

is what we want to avoid. 

Some of us are far away from Louisiana, but we care so much 

about these issues, we are coming. We are going to follow up on 

it. Just as I walk through your claims process, I am going to knock 

on the doors of the claims adjusters. I am going to come. I am going 

to follow up to make sure that these people are compensated. These 

small fishermen, these Black fishermen, these oyster fishermen 

have been doing this for years in third and fourth generations. 

They have got to be treated fairly and we want to make sure. 

Transocean, I am suspicious of you, too. You have dodged paying 

your U.S. corporate taxes by locating headquarters in Switzerland. 

You know you can’t be trusted. And aside from that, I want the 

Honorable Jim Hood to tell me about what have you filed, are you 

trying to limit liability in the way that they have filed, Mr. Hood? 

Mr. HOOD. Transocean filed in Houston, Texas, an action to try 

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dation action before another Federal judge in Houston, Texas to try 

to consolidate as many as possible. 

We, States, and that includes Florida, some of the Republican 

colleagues will recall, Bill McCollum was a Member of this honorable body, is an attorney general in Florida running for Governor 

there, and I assure you that every one of my colleagues want to 

have our cases heard in our State courts and not be pulled off by 

some of their actions before some judge in Houston Texas. 

So we have asked that there be some amendments to some legislation to prevent that. Those are procedural amendments. They are 

not some ex post facto problem. We believe that it would relieve the 

States from having to fight for 20 years as did people that were victims of the Exxon Valdez spill. 

Ms. WATERS. Thank you so much, Mr. Chairman. I appreciate 

the extra time you have given me. This gentleman has a legitimate 

concern in that amendment that he is asking for and as Chairman, 

I will take your leadership on that. But we have to watch 

Transocean. Okay? Thank you. 

Mr. CONYERS. Judge Ted Poe of Texas. 

Mr. POE. Thank you, Mr. Chairman. I know you have had a long 

day. I have some questions and concerns, of course. 

I represent Southeast Texas. We border south western Louisiana 

across the Sabine River, or as you all say in Louisiana, the Sabine 

River, and probably represent more refineries than any Member of 

Congress there in Jefferson County, 22 percent of the Nation’s refineries. We love the oil and gas industry and we want to them 

stay in business because it supplies thousands of jobs for Southeast 

Texas. And most of those folks work in refineries. They work offshore. I think those are the toughest jobs in America. That is my 

opinion. 

But right now, 180,000 people are affected by job loss because of 

this disaster. 

And Mr. Hood, being an old trial judge in Houston, a State 

Judge, not a Federal judge, I agree you on the 11th amendment, 

just your legal opinion, do you think the current law allows you to 

file suit and have lawsuits in your State and this circuit misinterpreted it or they think you think they got it right and we need to 

fix it? Just a quick answer. 

Mr. HOOD. The answer is that we have a cause of action we can 

file in State court. OPA contemplates State court actions. The Federal District Court in Louisiana is one that misinterpreted that. 

Fifth circuit misinterpreted CAFA and all the Senators agree that 

were on the floor, we had the minutes of it saying, States won’t be 

subject to CAFA. It was bipartisan, 47 attorneys general signed a 

letter here, and I have a copy of it here, but we asked that we expressly accepted from CAFA and the fifth circuit who put that in 

their opinion but they ignored it. So you have Federal courts sapping up authorities that belong to the sovereign States, and we 

want to protect that. 

Mr. POE. But you say, in your opinion, you can sue in State 

court. 

Mr. HOOD. Yes, sir. 

Mr. POE. My concern, and I think is really four issues here, first 

of all, we are going to need to deal with the loss of life and injuries. 

161 

We haven’t heard a lot about that through the national media. 

Then we have to deal with the loss of businesses that are directly 

affected. We have to deal with the damage caused to the environment, and we have to find out what happened, and we have to find 

out what happened probably first. We don’t know really. 

My question and Mr. Foley may be the expert on this, who is in 

charge? We have heard that BP is in charge, the Federal Government is charge, nobody is in charge. Mr. Willis, who is supposed 

to be in charge of this situation? 

Mr. WILLIS. Representative Poe—— 

Mr. POE. That is me. Guilty as charged. 

Mr. WILLIS. All I can tell you is that I know who is in charge 

of the claims process for BP, and who is in charge for making sure 

folks are compensated for their losses, and that is me. 

Mr. POE. And that is you. Is BP in charge of this whole cleanup 

operation? 

Mr. WILLIS. I know that I am in charge of The Coast Guard—— 

Mr. POE. So you don’t know. 

Mr. WILLIS. I don’t know. 

Mr. POE. Mr. Foley who is supposed to be in charge of this? 

Mr. FOLEY. In a Federal incident response, the Federal incident 

commander is in charge and is usually from a government agency. 

Mr. POE. Like the Coast Guard? 

Mr. FOLEY. He has 51 percent of the vote, but it is a collaborative 

effort between stakeholders and the responsible party and a number of different people involved in the spill response. 

Mr. POE. So who is in charge? Is the Federal Government in 

charge? 

Mr. FOLEY. The incident commander has the decision maker. 

Mr. POE. And that is a Federal employee? 

Mr. FOLEY. Yes. And right now, that is the Coast Guard. 

And they are overseeing the responsible party’s efforts to respond 

to the spill. 

Mr. POE. So when the blowout happens, it seems to me we just 

kind of waited to see how much damage was done, I say we, the 

system, kind of waited to see what damage was done and then everybody started saying, pointing fingers at other people. 

When it happens like this, blowout, oil spill, who is supposed to 

respond first? 

Mr. Foley, can you answer that? We have 12 people here. Can 

anybody answer that question? 

Mr. FOLEY. There is a scheme in place for oil spill response. The 

responsible party is supposed to report it to the National Pollution 

Fund Center and the National Pollution Fund Center sends out a 

notice to claimants to set up a claims process. In terms of—— 

Mr. POE. Cleanup. I am talking about cleanup right now. 

Mr. FOLEY. For cleanup, usually the Coast Guard sets up different response centers in the areas that are going to be affected 

and the responsible party is responsible to bring the resources, 

there is a response an where they have to activate their oil spill 

response contractors and act, in this case, it is a spill of national 

significance, so it is going to be the biggest response that they have 

trained for, for these oil spills. 

Mr. POE. So Coast Guard is in charge of the cleanup. 

162 

Mr. FOLEY. The government agencies have oversight responsibility for their responsible party who has to bring all the resources 

to bear on responses. 

Mr. POE. I am not arguing with you, Mr. Foley. Is the Coast 

Guard in charge or not? Do you know under the law? You are the 

expert in this law. 

Mr. FOLEY. I have not been in involved with the spill response 

in any way, and I am not familiar with any of the details. 

Mr. POE. Can any of you answer that question? This happened, 

I assume the different corporations are trying to clean up, but who 

is in charge of making sure cleanup occurs? Even to this day? 

Can any of you answer that question? At least FEMA is not in 

charge. But, who is in charge? Nobody knows? 

Mr. HOOD. Judge, the Coast Guard has the responsibility. But 

the problem is that they have got, they are having to rely on information that is provided to them by BP so it is kind of a joint authority. But the end line, top line authority is supposed to be the 

Coast Guard. 

Mr. POE. What concerns me is this has been 5 weeks and because—this is my opinion—the response to the cleanup seemed to 

delay, and I don’t know if it is the Coast Guard or who, but that 

just increases damages because the cleanup, if it is not contained, 

of course, it eventually hits Louisiana or Mississippi or Texas. 

And the longer we wait on cleanup, and we have heard these 

comments from different people that are affected that no one is 

really trying to clean up the mess or is in charge, it increases damages, and somebody is going to have to pay for that. 

So Mr. Hood, do you want to give me some insight on that? 

Mr. HOOD. Yes, sir. I flew over Chandelier Island, which is about 

a 60-mile island running north and south. The northern tip is 

about 30, 40 miles from Mississippi, our coast. On Thursday, 2 

weeks after it occurred, Secretary Janet Napolitano came down and 

there were booms already around, so we have had the booms 

around our barrier island. I think the Coast Guard did a pretty 

good job in responding getting the booms out there, but they don’t 

work. It was a sea of red around Chandelier Island, and there was 

some great fishing around that area. 

So I think they got it out there, but they just don’t have the capability of dealing with it. Booms just don’t really work, especially 

in rough water. 

Mr. POE. I understand in Louisiana there were people in—the 

fishermen that were willing to help on the cleanup and it got 

bogged down in red tape. Mr. Encalade, can you help me out with 

that? Is that true? 

Mr. ENCALADE. Congressman Poe, yes. It is true, and I have to 

be honest with you, we stood, our old people, we stood on these 

banks and watched them deploy these booms in this rough water 

with a southeast wind coming in on the shores of Louisiana and 

Mississippi. And sir, I have to be honest with you. We told them 

they were wasting their time. But nobody listened. And it is those 

kind of things that—this is why I am here, because as Congresswoman Waters said, we can’t afford to keep making mistakes, and 

we are paying the price for them. 

163 

And just like she stated, going home and all of this, we are still 

being affected. We haven’t gotten our lives together completely by, 

from that. And now to go down these same roads to see BP following the same path, it just boggles the mind. You are still not 

listening to the people. And you are not listening, our parish president, Billy Nungesser, and I would love to make this comment if 

you don’t mind, sir, the night this incident happened, the first 

thing he did, and we were on the phone 11, 12 o’clock at night, he 

called his entire fishing community and got advice and he knew 

what he had to do by the next day. Problem is, nobody listened to 

him. 

Mr. POE. You have to know who to talk to. 

Mr. ENCALADE. And it is the same thing. We just keep going. We 

have been begging for those islands to be pumped back for over 40 

years. And so it is the same thing. That is the problem. 

Mr. POE. One more question. Top kill apparently is working now, 

and at least so far today, who made that decision to use that procedure? Did BP make that decision? Mr. Willis, do you know. 

Mr. WILLIS. I will preface my comments by saying that I was not 

involved in that decision. I have been involved in the claims process but—— 

Mr. POE. We need to have somebody from BP to make some 

other decisions besides claim here, Mr. Chairman, at some point, 

if that is appropriate. 

I was just curious, but nobody apparently can answer that, since 

it probably works. Why wasn’t it tried 3 weeks ago? Maybe we will 

find somebody else who can answer that question for us, Mr. Chairman. I want to thank you all for being here. Thank you, Mr. Chairman, I yield back. 

Mr. CONYERS. Steve Cohen, Chairman of the Commercial Law 

Committee. 

Mr. COHEN. Thank you, Mr. Chairman. Let me ask Mr. Willis, 

I was reading your statement, where did you go to school? 

Mr. WILLIS. I went to High School at McDonogh 35, and I went 

to Northwestern State University in Natchitoches, Louisiana. 

Mr. COHEN. You are going to pay all these damages and some, 

where it says directly related to, what if there is a restaurant that 

doesn’t have—like Galatoire’s, I was saying, or Acme Oyster Bar, 

they don’t have any oysters or oysters, whatever you want to call 

them. Who is going to pay the Acme Oyster Bar? Are you going to 

do that? 

Mr. WILLIS. Congressman Cohen, what we are going to do is, and 

we have put a process in place so that any business that feels like 

it has been directly hurt or impacted by this oil spill in the Gulf 

of Mexico can go in and file a claim through our process and it will 

be reviewed. 

Mr. COHEN. It will be reviewed. And that is your stock answer, 

and I realize that is the limit of your authority, but the problem 

you have got is every restaurant in Louisiana in the Gulf Coast, 

particularly New Orleans, is going to be hurt. People go to New Orleans for a couple of reasons, and one of them is to eat. And if you 

ain’t got any oysters, we can’t go down to eat and if you are a seafood restaurant you are really going to be hurt. 

164 

So Felix is bad news, Acme is bad news. And while you can eat 

steak down there, you really go for the seafood. Rent a car business, they are going to be hurt. Hotels are going to be hurt. Casinos are going to be hurt because people aren’t going to go down 

there. They all can file claims. Give me your thoughts of the probability of those people being compensated by BP oil because really 

you need to subsidize the State of Louisiana for a long time. 

Mr. WILLIS. I will start by saying that I love the Acme Oyster 

House. It is one of my favorite places to eat. 

Mr. COHEN. I hope I can meet you there some time in the future, 

and we will have to be real old. 

Mr. WILLIS. What I would add to my comments is that this 

claims process is very specific. Individual claims would be very specific. Some of the easiest claims to resolve are those around individuals, fishermen, crabbers, oystermen. Business claims are coming 

in now and we are looking at every one individually. We are using 

the best resources available and we will make fair decisions. 

Our goal through this whole process is to be reasonable, is to be 

reasonably efficient, and to be fair, and do the right thing. 

Mr. COHEN. I got what you are saying. It is just going to be 

tough because to do the right thing, you are really going to have 

to take over that State and part of Mississippi and part of Alabama, I guess, because the damages you have caused are going to 

affect those States for the rest of my life probably, a long time. Several decades. And that is just fact. You are going to have to advertise every Tulane basketball game, even if nobody goes, LSU football games. You need to be the sponsor for all of them. Baseball 

teams. Everything. What was the profit of BP oil last year? 

Mr. WILLIS. The profits of BP last year, I don’t know that number offhand. 

Mr. COHEN. Give me a ballpark figure. 

Mr. WILLIS. I would guess it was on the order of $20 billion. 

Mr. COHEN. That is not enough. You all have to work harder. 

That is not going to take care of what you owe. Are you all going 

to go out of business? 

Mr. WILLIS. We are going to do the right thing, and we are going 

to mitigate all of the damage that we have caused as a result of 

this spill that we are obligated to do under the law. But in addition, there are some other things we are going to do as well. For 

example, we offered up the $25 million block grants to the State 

to expedite the cleanup process. We recently offered $70 million to 

the State to help sort of publicize tourism. 

Mr. COHEN. How about all the losses they are going to have from 

sales tax revenue from folks not going down there? And how about 

when the marshes are destroyed and the next big 5 hurricane 

comes in, and the city gets wiped out, are you going to compensate 

the city of New Orleans for its path and for another evacuation of 

the city? 

Mr. WILLIS. We will cover the expenses, the legitimate expenses 

that have been substantiated and are related to the spill. 

Mr. COHEN. Mr. Willis, you are doing your job good and you have 

a tough job because legitimate, directly, and recorded in this bill, 

there is going to be a lot of people in this Nation that are going 

to suffer and the government is going to end up being the surety, 

165 

because we are going to have to pay for it and make up for Louisiana’s losses and all the cities it is going to fall on the backs of the 

United States taxpayer, and we are going to have to come to the 

rescue because you are going to say they are not direct, et cetera, 

et cetera. Not your fault. It is the fault of your company. You are 

doing your job. 

Mr. Lemmer, you know something about the Safety Valve Program, I guess, is that right? 

Mr. LEMMER. I am a lawyer, not an engineer. I know something 

about it generally, yes. 

Mr. COHEN. Well, when Judge Poe was throwing around, not 

him, Mr. Franks was throwing around those words, it seemed like 

you understood them. Should BP or somebody have seen the worst 

possible case scenario that this would have occurred and then prepared to respond? Should they not have been prepared to respond 

in some manner? 

Mr. LEMMER. Sir, that is a difficult question for me to answer, 

because we are an equipment and service supplier, and BP is the 

operator. 

Mr. COHEN. But as service supplier, wasn’t there a possibility 

that what you supplied, would have a problem, which it apparently 

did, and that they should anticipated that and seen the worst possible case scenario and had top kill ready to go before this ever 

happened? 

Mr. LEMMER. Should BP have foreseen something like this occurring? BP has testified that they viewed this as a failsafe device 

when, in fact, it is not. It is the last chance, but it is not a failsafe. 

So should they have foreseen it? I don’t know. That is going to be 

for the courts to decide in the future. 

Should they have a top kill ready to go? That is a different question. That procedure, I understand, has been used on the surface, 

it has never been used at these depths. I don’t know that it has 

every been called on to be used in these depths before. It was 

talked about early on after the blowout. But why other efforts got 

priority over the top kill, I can’t tell you. 

Mr. COHEN. I don’t know who is the right person to answer this 

question, maybe nobody can, but it doesn’t seem to me it is right 

to allow us to let any company drill at depths where we don’t have 

the ability to go in there and stop a leak. We don’t have that benefit, well, top kill wasn’t done at that depth, the first thing we had 

were the dome, we didn’t have the Superdome ready, we couldn’t 

do that either because we hadn’t done it at that depth. We didn’t 

know it was going to freeze when it got down there in the saltwater, and all that stuff and there was going to be a problem. 

If they don’t know how to do it, we shouldn’t let them drill. It 

was the negligence of the Bush-Cheney-Halliburton regime that 

gave them that authority, and we are suffering from it today because they allowed this to occur, and it never should have been 

permitted. And for 8 years after they had their secret meetings in 

2000 and 2001 that we still haven’t seen the results of with the oil 

companies, and BP was there, and Conoco was there, and 

ExxonMobil was there, and Cheney was there. They came up with 

an energy program that has hurt this country to this day and conVerDate Aug 31 2005 15:09 Nov 29, 2010 Jkt 000000 PO 00000 Frm 00169 Fmt 6633 Sfmt 6601 H:\WORK\FULL\052710\56642.000 HJUD1 PsN: 56642
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tinues to hurt the country. And it is the responsibility for this goes 

back to Bush, Cheney and Halliburton. 

Thank you, Mr. Chairman. 

Mr. CONYERS. Magistrate Hank Johnson, chair of Courts Committee from Georgia. 

Mr. JOHNSON. Thank you, Mr. Chairman. 

Mr. Willis, I think you have the bearing and the manner of an 

attorney or a public relations professional. And I want to just, 

yeah, I want to commend you for the way in which you have handled the task that you were called upon to do today which is to represent British Petroleum. 

And let me ask you, I have heard you say earlier that you have 

a degree in geology? 

Mr. WILLIS. In geology and geophysics, a master’s degree. 

Mr. JOHNSON. And have you been to law school or—— 

Mr. WILLIS. I have not. 

Mr. JOHNSON. And now do you report to a lawyer? 

Mr. WILSON. I do not. 

Mr. JOHNSON. You do not. Now, who do you report to? What division, if you will, of BP? 

Mr. WILLIS. In my day job outside of the response associated 

with the spill, I report to the executive Vice President for North 

America Gas. I am the VP of resources, which essentially means 

I am the VP for geology and geophysics and petrophysics for the 

lower 48 onshore business. 

Mr. JOHNSON. And you have no responsibility for dealing with 

legal issues whatsoever? 

Mr. WILLIS. I do not deal with legal issues. 

Mr. JOHNSON. But you have been assigned to deal with claims 

issues? 

Mr. WILLIS. I volunteered to be a part of this claims process for 

two reasons: One is because I lived through Katrina with my mother. I lived through the Road Home, as a matter of fact, the check 

for the Road Home came; by the time we got the check from the 

Road Home, my mother was dead. 

Mr. JOHNSON. Now you are kind of filibustering me right now, 

though. Let me proceed on. So you volunteered to serve your company in any way that they thought would be good, and so they assigned you to be the claims representative? 

Mr. WILLIS. Actually, they didn’t assign me to be claims representative. I saw that as an emerging need once the well continued to flow. 

Mr. JOHNSON. Got you. Now having volunteered to handle the 

task of handling claims, are you working with an insurance company as you handle these claims? 

Mr. WILLIS. We are actually working with a company called 

ESIS, which is a catastrophic—a company that deals in managing 

catastrophic claims for businesses. They are not an insurance company, although they are owned by an insurance company called 

Ace. 

Mr. JOHNSON. So essentially, Gulf Oil is—excuse me, BP petroleum is self-insured with respect to this kind of catastrophe? 

Mr. WILLIS. That is my understanding. 

167 

Mr. JOHNSON. And the claims process is a process that traditionally you adjust the claims and you limit your liability. Is that your 

understanding? 

Mr. WILLIS. My understanding of the process that we have in 

place is that we are going to make sure we put a process in place 

that is efficient, that is fair, that is reasonable and that pays people comparable to the losses they incurred. 

Mr. JOHNSON. Let me ask you this question. We have all these 

lawyers here, we have a professor of law, the hearing—we got lawyers all across the room. And the hearing is on legal liability issues 

surrounding the Gulf Coast oil disaster. 

Can you think of any person at BP who would perhaps be more 

appropriate to handle this task than what you volunteered to take 

on? When I say this task, I mean preparing to appear before this 

Committee today. Is there someone who could have done it perhaps 

a little better than yourself? 

Mr. WILLIS. I think in terms of coming to this Committee to talk 

about how BP is responding to the needs of the folks in the community in regards to the damage that has been caused, being caused 

by the spill, I am the best person to do that. 

Mr. JOHNSON. Okay, well, did you bring your claims package 

here? I assume that you have a package, claim forms, if you will, 

that people would have to fill out? Isn’t that correct? 

Mr. WILLIS. There are claims forms that people will have will 

have to fill out yes. 

Mr. JOHNSON. Last night, or excuse me, last week I had the opportunity to ask questions as a Member of the Transportation and 

Infrastructure Committee, the Water Resources Subcommittee, I 

had the opportunity to question your president, and he promised 

to send the entire claims package to us, which we have not received 

yet. Did he entrust you with that claims package to bring here 

today since you are the person in charge of claims for BP international, if you will? 

Mr. WILLIS. When you say ‘‘claims package,’’ can you tell me 

what you mean? 

Mr. JOHNSON. All of the forms that one would have to sign in 

order for their claim to be considered? 

Mr. WILLIS. I did not bring those forms with me today. 

Mr. JOHNSON. Why not? 

Mr. WILLIS. I was not aware that I needed to bring those forms 

with me today. 

Mr. JOHNSON. Since you are in charge of the claims process, can 

you list for me, as you sit here today, all of the forms that are in 

the claims package? 

Mr. WILLIS. Yes. And it depends—— 

Mr. JOHNSON. Well, now hold on now. It depends. Only thing I 

want is just the name of each form in the claims package, all 

claims packages combined. 

Mr. WILLIS. I will start by saying that the claims form is available on our Web site at www.bp.com/claims. And on that Web site, 

we are going to have a claims manual that summarizes everything 

that is involved in the claims process. That manual is about 52 

pages. 

168 

Mr. JOHNSON. And I am asking you for the forms that must be 

filled out, whether or not they are over the Internet or whether or 

not they are hard copies. I just want to get—yeah. 

Mr. WILLIS. Okay. 

Mr. JOHNSON. So you have a claim application form. 

Mr. WILLIS. There is a claim application form, and that form differs slightly if you are a fisherman. 

Mr. JOHNSON. What else do you have other than the claim application form which may differ, whether or not it is an economic 

damage, an environmental damage or an injury claim, personal injury claim, so you got the claim application? 

Mr. WILLIS. Yes. 

Mr. JOHNSON. What else do you have? 

Mr. WILLIS. That is the form that has to be filled out. 

Mr. JOHNSON. How many pages is it? That is the only form? 

Mr. WILLIS. That is the only form that needs to be filled out. In 

addition to that form, there is some documentation that is required. 

Mr. JOHNSON. Yes. Release of information, or something like 

that? 

Mr. WILLIS. What we ask for is some proof that of income. It 

could be a tax return. It could be payroll stubs. It could be deposit 

receipts. It could be fish tickets or shrimp tickets showing that you 

actually transported and delivered a load for sale. 

Mr. JOHNSON. Let me ask you this question. You said the other 

day, excuse me, you said earlier in this hearing that you paid out 

about 37 million claims—$37 million in claims on, with 400 adjusters, 24 walk-in clinics, and those kinds of things, Internet filing 

claims and everything, the $37 million, 25 of that went to Mississippi, was that the 25 million? 

Mr. WILLIS. No. That is something totally separate. The 37 million is associated with money that is directly put into the hands of 

fisherman, shrimpers, oyster harvesters and businessmen in local 

communities from Louisiana to Florida. 

Mr. JOHNSON. So what about releases, release of any and all liability in return for the payment that would be generated by the 

claim application? 

Mr. WILLIS. There is no release required in our claims process. 

Mr. JOHNSON. Okay, and the conversations that were had at the 

disembarking location when the workers were brought back to 

land, about 28 hours or so after the tragedy occurred, were those 

interviews tape recorded, either audio or video? 

Mr. WILLIS. I do not know anything about what happened and 

what you just described. I took over the—and started running the 

claims process associated with responding to the oil spill on the 

29th of April. 

Mr. JOHNSON. All right. Thank you, sir. 

Ms. Clingman. Basically, what you are arguing is that you are 

indemnified, or, in other words, Transocean is indemnified for any 

and all liability that it may have for everyone as a result of this 

catastrophe. You are indemnified by BP. 

Ms. CLINGMAN. Yes, Congressman our contractual arrangements 

are similar to the OPA statute, and also for the organizational 

chart for rigs. So BP as the operator is responsible for the well and 

169 

any hydrocarbons from the well. That is OPA law, and that is reflected in our contract as well. You are exactly correct. 

Mr. JOHNSON. And as you know or as you may know Transocean approved a $1 billion dividend to shareholders, just back on May 

15, May 14, actually. Some have argued that that dividend makes 

it more difficult for victims of the Deepwater Horizon to pursue liability claims against your company. Others have likened this to a 

fraudulent transfer in bankruptcy. When a debtor transfers money 

or property immediately before filing a bankruptcy petition. Is this 

within 45 days of the event? Actually within about 2, 3, weeks before the event we have this transfer of wealth, if you will, from the 

corporation to the shareholders, and I don’t know who those shareholders are, but I would assume them to be closely associated with 

the company in terms of management. 

Was that an appropriate time, in your opinion, for shareholders 

to take those profits? 

Ms. CLINGMAN. I am very glad, Congressman, you asked that 

question because there had been some confusion about the declared 

dividend and if I could clarify some of the timing. 

Mr. JOHNSON. Mmh hmm. I am sorry would you repeat that, 

please. 

Ms. CLINGMAN. Yes, sir. I am glad you asked the question. There 

has been some confusion about the declared dividend and I would 

like to address that. First and foremost, the dividend declared, 

none of which has been paid to date, in no way affects Transocean’s 

responsibility or ability to meet its legal obligations to persons involved in this incident. So there is no, in terms of relation to bankruptcy or depleting assets, there is no concern whatsoever that 

Transocean will not be able to meet its liabilities. 

Addressing the dividends specifically, I agree with you that the 

timing does not look as good as it might given the incident. It was, 

however, put in place significantly before the Deepwater Horizon 

incident. This had been board approved back in February 2010 

after several years of Transocean being in a growth mode not paying shareholder dividends and so the board had decided mainly 

based on competitive factors and other companies paying dividends 

that it was time to reward loyal shareholders with an approximately $4 per share dividend. That was put out in a recommendation in a proxy filed with the SEC and distributed to shareholders 

before the Deepwater Horizon incident. 

Now, you should also know there are safeguards in place to prevent the eventuality you described from being true. 

Mr. JOHNSON. I don’t want you to go into that because I want 

to yield back the balance of my time. But I do want to say that I 

feel that you have been very knowledgeable and communicative 

with me, and the time that I was here in this hearing, you have 

also been very forthright. 

I would love for BP, I would love to be able to look at that position on the table, because this is not personally directed at you, Mr. 

Willis, but I would love to be able to say the same thing about BP. 

I feel like we have gotten bamboozled by BP with you being here 

to answer in the questions of Members of Congress. 

And if I could, Mr. Chairman, I have been asked for a short yield 

to Mr. Cohen. And I shall so yield. 

170 

Mr. COHEN. Thank you, Mr. Johnson, and thank you, Mr. Chairman. I guess I needed to follow up a question of Mr. Ferguson here, 

since he is with Halliburton. What knowledge do you have, and did 

you attend any of those meetings with Vice President Cheney when 

they brought about the oil policy for the United States of America? 

Mr. FERGUSON. I have no knowledge of that whatsoever. I have 

never attended any meeting. My understanding is nobody from 

Halliburton attended any such meeting. 

Mr. COHEN. So you haven’t seen any memos, any papers? 

Mr. FERGUSON. No, sir, I have not no. 

Mr. COHEN. You don’t know anything about those meetings at 

all? 

Mr. FERGUSON. Only what I have read in the newspapers. 

Mr. COHEN. Is Mr. Cheney involved with Halliburton now. 

Mr. FERGUSON. Not in any way that I know of. 

Mr. COHEN. In Transocean and Halliburton and BP, do you all 

have any members of one of the other companies on your boards? 

Does anyone here, do you know? Mr. Willis, do you know who is 

on the board of BP? 

Mr. WILLIS. I do not have those names in my head, no. 

Mr. COHEN. Ms. Clingman? 

Ms. CLINGMAN. I don’t know of any members of these companies 

serving on our board. I will absolutely find out and get back to you. 

Mr. COHEN. It is public knowledge, I am sure. 

Mr. Ferguson? 

Mr. FERGUSON. There is no current person at BP that is on our 

board. There is one board member that is retired some years ago 

from BP that is on our board right now. 

Mr. COHEN. He is retired. What is his name? 

Mr. FERGUSON. His name is Robert Malone. 

Mr. COHEN. What was his position at BP? 

Mr. FERGUSON. Don’t hold me to this. I think he had a similar 

position to what Mr. Lamar McKay does. 

Mr. COHEN. President. 

Mr. FERGUSON. Of BP Americas. 

Mr. COHEN. And he is now on the board of Halliburton? 

Mr. FERGUSON. Right. Although like I said, he is completely separated from BP. 

Mr. COHEN. Ms. Clingman, what were the profits last year at 

Transocean? 

Ms. CLINGMAN. The Transocean entity that paid the dividend out 

of Switzerland, I would have to get the number. I don’t know. I 

don’t have any figure. 

Mr. COHEN. Ballpark? No? Mr. Ferguson what is the ballpark on 

Halliburton last year? 

Mr. FERGUSON. Again, we can get the number, but it is something under a billion dollars. 

Mr. COHEN. Thank you. Thank you, Mr. Johnson. 

Mr. JOHNSON. And I yield back. Thank you. 

Mr. CONYERS. Dr. Judy Chu of California. 

Ms. CHU. Thank you, Mr. Chairman. First let me ask the panel 

even though only a dozen of Transocean’s employees are physically 

located in Zug, Switzerland, and more than 100 are based in Houston Texas. Transocean moved its headquarters 2 years ago. To me, 

171 

it seems the apparent underlying purpose is to avoid U.S. corporate 

income tax. We know now that the Transocean flag of the Deepwater Horizon is in the Marshall Islands, can anyone on the panel 

explain why a vessel that is flagged in a particular country, whether such company seek to avoid safety regulations by flagging the 

vessel outside of the United States? 

Ms. CLINGMAN. Yes, Congresswoman, I would be happy to address that. You are correct; the Deepwater Horizon is flagged in 

the Marshall Islands. Transocean is an international company. Of 

our approximately 139 drilling rigs, all but 15 are outside of the 

United States. And so very few of our vessels are flagged in the 

United States. 

Most importantly, that does not result in any break in operational requirements for operating in U.S. waters and we remain 

under U.S. Coast Guard jurisdiction for our operations in United 

States waters such as the Gulf of Mexico. 

Logistically, however, if a rig is flagged in the United States, 

what that requires under Coast Guard regulations is that a member of the U.S. Coast Guard conduct a physical inspection of that 

rig annually. When the rig itself is traveling around the world and 

it is sometimes in the Middle East or the Far East that becomes 

a logistical issue. 

Another requirement is that a U.S. flagged vessel be captained 

by a U.S. citizen. We do that for every in rig in the Gulf and all 

the members on board the Deepwater Horizon Deepwater Horizon 

were citizens of the United States. However, when those rigs are 

moved to less hospitable jurisdictions, we have great difficulty employing a U.S. citizen to command and chair those rigs. 

And so the flagging is predominantly a logistical issue as a majority of our rigs are working outside of the United States. There 

is also a financial tax benefit to doing that but importantly there 

is no regulatory or compliance benefit from flagging the vessel in 

a foreign country as opposed to in the United States. 

Ms. CHU. Does anybody else have any comment on that? 

Okay, well, then I will turn to another topic. Actually, I am very 

anxious to ask questions pertaining to the Vietnamese fishermen 

in the area. I have been in touch with representatives from the 

area. They are experiencing particular problems, so Mr. Willis, I 

would like to ask you questions pertaining to their plight. There 

are, today, tens of thousands of Vietnamese shrimpers that are 

making their livelihoods in the waters of the Gulf Coast, and, in 

fact, they represent about one-third of the shrimping community in 

the Gulf Coast. Because of that strong Diaspora in Louisiana, Mississippi, and other Gulf States, there is a problem with English 

proficiency. 

And in fact, with one community in Louisiana, English language 

proficiency in Louisiana is about 10 percent. They have expressed 

concerns over access to BP and government programs due to the 

language barrier. The translators provided by BP have been unable 

to communicate clearly the legalities for seeking damages for lost 

income, cleanup employment opportunities and unemployment assistance. 

And in fact, Vietnamese fishermen have been encouraged to sign 

contracts written in English by BP representatives that provided 

172 

$5,000 in damages in exchange for waiving one’s right to sue and 

similar liability waiver was required to access employment for the 

vessel of opportunity program which hires local boat operators to 

assist with response activities, so in other words, to get the job, 

they would have to sign that liability. 

First of all, are you still requiring people to sign the liability? 

Mr. WILLIS. We never required any sort of signing of waiver of 

liability for the claims process. Never. 

There was a waiver of liability, as I understand it, associated 

with the vessels of opportunity program that you described. That 

was destroyed and a very simple form was put in place. It was a 

mistake and it was corrected quickly. 

Ms. CHU. So you were not requiring—— 

Mr. WILLIS. Absolutely not. 

Ms. CHU. I want to hear you say that that you are not requiring 

that waiver of liability. 

Mr. WILLIS. We are not requiring a waiver of liability. 

Mr. HOOD. Dr. Chu, I am sorry to correct the record. I am Jim 

Hood, AG from Mississippi. We have many Vietnamese fishermen 

on our coast who did sign some of those waivers. We got a commitment out of BP to give us a list of those names, and we sent translators down to make sure that they know that that waiver has 

been withdrawn. So we are going to make sure that—it did occur. 

It did occur for when they hired them to pull booms and so forth, 

so I want to make sure that was correct. 

Mr. WILLIS. I want to make sure you understand what I said. 

For the claims process, there was never at any time a waiver required. 

For the vessels of opportunity program that Attorney General 

Hood just referenced, in the beginning, there was and it was destroyed. It was taken out of the process. 

Ms. CHU. Well, is there something on the forms that say that 

there is a $5,000 limit for the claims themselves? 

Mr. WILLIS. Can you repeat the question. Please. 

Ms. CHU. In terms of the claims form, does it suggest that there is some kind of $5,000 initial limit? 

Mr. WILLIS. No, it does not. What we said about the claims process is that we are going to compensate people for their losses. But 

in order to expedite the process, we are making advance payments 

interim payments to get money into people’s hands within 48 hours 

versus having to wait 45 days or 30 days to make it happen. It 

does not say anything about $5,000 on the form. 

Ms. CHU. Are these claims documents, these claims forms, are 

they translated into Vietnamese? 

Mr. WILLIS. They are translated into Vietnamese and Spanish 

and they can actually be accessed on our Web site at www.bp.com/ 

claims. 

Ms. CHU. I want to point out that there have been some problems with the translation, and a Vietnamese priest told me that for 

instance, the translation for ‘‘deck hands’’ was translated into 

something like ‘‘hands growing out of decks.’’ And I want to really 

emphasize that you have to have a culturally sensitive and culturally appropriate translation for these forms and for the outreach 

kind of program that you have for these fishermen. 

173 

And what kind of assistance will there be for people who are 

going through the process besides the translation of the forms? 

Mr. WILLIS. I will tell you a little bit, Congresswoman Chu, what 

we have been doing, and I will talk specifically about what I have 

been involved in in Louisiana and Mississippi, in Louisiana in Venice and in New Orleans and in Mississippi in Biloxi. We have about 

122 local people that we hired in our Venice community outreach 

center. Half of those people, actually 60 percent of them are either 

Vietnamese, Taiwanese, or from Cambodia. 

We have people working there to help us in a variety of ways, 

one to get connected with the Vietnamese and Asian communities 

in the Louisiana area, but we have also moved some of those people 

in the claims center to help us get those folks do their claims process as quickly and efficiently as we can. 

In New Orleans, just on Monday, Congressman Cao had an expo 

where we had 5 to 600 Vietnamese present. He asked us if we 

would offer a vessel of opportunity training. He asked us if we 

would open up a claims center for the day on site and we did, recognizing that the process we have in place is not perfect, but we 

are going to correct the problems we see with it, he recommended 

eight or nine, as I recall, translators that we should hire in our 

New Orleans office. We are in the process of bringing those folks 

in so that we can better connect with the community in the most 

effective way possible. 

In Mississippi we have had training, specifically for the Vietnamese community around the vessel of opportunity program. We 

have had that training done in Vietnamese. 

So we are continuing to work it every day and to make it as good 

as it can possibly can be. 

Ms. CHU. And you are going to get back to the people who signed 

those waivers and make sure you do adequate outreach to them? 

Mr. WILLIS. Absolutely, absolutely, we have to. 

Ms. CHU. There are so many assistance programs available, but 

what steps will you take to educate the Vietnamese community 

through the media? You know, they don’t partake necessarily of the 

mainstream media. Are you accessing the ethnic media? 

Mr. WILLIS. I do not know the answer to that question, but it is 

definitely something I will find out. 

Ms. CHU. Well, they need to know of these assistance programs, 

and I do have a list of the Vietnamese media outlets, so here so 

I would like you to make sure that they are part of this assistance 

and outreach program. 

Mr. WILLIS. I will be happy to do that. 

Ms. CHU. Thank you. And I yield back. 

Mr. CONYERS. Attorney Ted Deutch of Florida. 

Mr. DEUTCH. Thank you, Mr. Chair. First of all, Mr. Jones, my 

sympathy to you and condolences to your family and the ten other 

families who are suffering, and Mr. Stone and Mr. Brown, to you 

and the other 15 injured, I appreciate very much your being here 

today. 

The goal of this hearing I think for the families of those who lost 

their lives and those who are injured Mr. Encalade whose businesses have been so impacted is ultimately figure out how we obtain justice. And along those lines, Mr. Willis, you said that BP has 

174 

stated you have stated throughout that you are going to pay all legitimate claims notwithstanding the cap in the Oil Pollution Act. 

And I know that you have paid thus far 13,500 claims. What is the 

total dollar amount? 

Mr. WILLIS. It is around $37 million. 

Mr. DEUTCH. And the analysis that you used to determine 

whether those claims were legitimate and how they are paid is 

there any consideration of the amount of the claim when those 

claims are fired. 

Mr. WILLIS. No, based on the claim that was submitted. 

Mr. DEUTCH. And will it change when you hit the $75 million cap 

and beyond? 

Mr. WILLIS. It will not. 

Mr. DEUTCH. And Mr. Willis, if there is no—if BP has made the 

determination that if, in fact, it is responsible for these losses and 

will pay well in excess of the 75 million, is there—is that simply 

a company determination? I guess the question was for Mr. Ferguson, Ms. Clingman. 

Ms. Clingman, the Transocean seems to be the counterpart to 

BP. BP, according to Mr. Willis, tells us they are going to pay in 

excess of the $70 million cap, Transocean, on the other hand, has 

filed a claim trying to limit its liability to 27 million. 

Why, in my case, I represent southeast Florida, if this oil comes 

into the loop current and hits the southeast coast, the damages will 

be well in excess of millions, well in excess of the billions. Why is 

it appropriate for liability to be limited? 

Ms. CLINGMAN. Because it goes back, Congressman, to the two 

separate types of claims, and although there are many, many lawsuits they fall into two big categories. One are the OPA claims such 

as you are describing, damages to beach front, to fishermen, to 

commercial industries, tourism industries, those fall into the Oil 

Prevention Act. Those are the claims for which BP has been designated and has accepted responsible party status. Those are the 

ones going through the claim process. The lawsuit that we filed 

does not relate in any way to those types of claims. The limitation 

of liability action applies only to claims asserted under maritime 

law. 

Mr. DEUTCH. Then in which case under the Oil Pollution Act, if 

there were claims you would be limited by the 75 million? 

Ms. CLINGMAN. With respect to Transocean, Transocean has accepted responsible party status under OPA only with respect to oil 

or fuels or diesel that would emanate from the rig itself on the sea 

floor. I have no evidence that that has happened. 

Mr. DEUTCH. Ms. Clingman, let’s assume that it happened. Let’s 

assume that this entire mess was Transocean’s fault just for the 

sake of this discussion. In that case, would Transocean acknowledge that the $75 million cap under OPA is inadequate and that 

you would be responsible or should be responsible for more than 

that? 

Ms. CLINGMAN. Nothing under OPA puts us in a responsible 

party position for the oil well leak, which is what is leaking. I can’t 

wear BP’s cap, but—— 

Mr. DEUTCH. Let me try it this way, Ms. Clingman. For Mr. Ferguson the question is this: There is a $75 million cap under OPA. 

175 

The fact is the estimates are that this may cost $14 billion; it may 

cost considerably more. We may not know for some time. Why 

shouldn’t that cap be raised to a level that helps compensate those 

whose lives have been turned upside down by this environmental 

disaster? 

Mr. FERGUSON. In our position we are just not involved in the 

cap, but as a general proposition on the hypothetical that you mentioned, I think we would support any reasonable change in the law. 

I can’t commit without seeing what is written, what it is about. But 

the cap itself, as I have heard discussed here today, may be too 

low. 

Mr. DEUTCH. Mr. Willis, I know you have agreed to this, but the 

way to confirm that BP has agreed to this is to acknowledge the 

importance of increasing that cap beyond the $75 million. A reasonable amount, I would suggest to the three of you, is an amount necessary to compensate those for their losses. BP would be willing to 

see an increase in that cap, presumably? 

Mr. WILLIS. We have said, and I will say again, that we believe 

that cap is not relevant, and that we accept that we will exceed 

this cap, and we will pay all legitimate claims above it. 

Mr. DEUTCH. And, therefore, Mr. Willis, if we introduce legislation to increase that cap, to remove that cap altogether, to cover 

all legitimate claims, BP would then support that legislation? 

Mr. WILLIS. We will follow the law. 

Mr. DEUTCH. I would like to turn to the Death on the High Seas 

Act for a moment. Under that statute there is a discrepancy that 

we have heard about earlier, that the surviving family members of 

a person who dies on a vessel on the high seas versus the damages 

available to those relatives whose—to the family members of a relative who died in a plane crash on the high seas, there is a discrepancy. I would like to know if there is anyone who can speak to why 

we shouldn’t take action, why this Congress shouldn’t take action 

immediately to change that law so that the families of those who 

perished in this accident should receive the same treatment as the 

families of those who lost relatives in an airplane crash in precisely 

the same location? 

Mr. GALLIGAN. I would be happy to address that, and my answer 

would be that you should; that the current state of the law provides an inconsistency which allows recovery, as you have stated, 

to the victims of commercial aviation disasters, but it doesn’t allow 

recovery to the other victims of maritime disasters. 

Today, right now, and I don’t want to use the Joneses as an example, I hope they will forgive me, but if they were to pursue their 

legal redress, and if they were to establish liability, nobody in the 

family would recover anything for the loss of care, comfort and society that they have suffered. 

Mr. DEUTCH. Mr. Galligan, if I may follow up on that. In his 

opening statement we heard Mr. Jones say that he worries about 

his newborn grandson Maxwell and whether Maxwell will be eligible for any damages under the Death on the High Seas Act because 

he was born after his father Gordon died in this explosion. Can you 

comment on that? Can you give him some comfort in knowing that 

that is not the case? 

176 

Mr. GALLIGAN. I am not sure I can give him comfort. I can tell 

him that the state of the law is somewhat confusing. In DOHSA 

cases, in general maritime law cases, what the courts will frequently do in situations to define relationship, whether it is parent, 

spouse, child, is they will look to applicable State law to determine 

the relationship. 

So in this case they would probably look to Louisiana law to decide whether or not a viable fetus subsequently born after the 

death of a parent has a right to recover. So Mr. Jones would have 

to go and consult what the law of Louisiana was; which, of course, 

means that the recovery of different people under DOHSA cases in 

different States may be different depending upon the relevant 

State law. Certainly something that could be done here would be 

to say that a child includes a viable but not yet born fetus. 

Mr. DEUTCH. Mr. Galligan, just to wrap up this important topic, 

in order for us to ensure that Mr. Jones and the families of those 

others who perished in this accident—in order to ensure that they 

receive the treatment under law that they deserve and the compensation that should be rightfully theirs, the approach should be, 

one, to address this discrepancy that exists between airplane crashes and these types of accidents? 

Mr. GALLIGAN. Yes. 

Mr. DEUTCH. And, number two, to specifically address the types 

of family members and the occasions when this will be applicable? 

Mr. GALLIGAN. Yes. And I think there is something else you 

would have to address, and that would be the effective date of any 

amending legislation. You would have to consider whether or not 

you would make that amending legislation applicable to events 

that occurred before the passage of the legislation. And in doing 

that, the questions that arise are two: One is policy, and the other 

is constitutionality. 

On the policy standpoint, the questions are adequate compensation, which I have already discussed; modernizing the law, which 

I have already discussed; and making the law consistent with other 

aspects of maritime law and State law. And on constitutionality, 

unless a statute retroactively applied is going to inhibit some other 

constitutional right, the balance and test is is there a reasonable, 

rational basis to do that? And the rationality would be supported 

by what: By the same things that would justify the policy change. 

Interestingly, you did exactly that when you amended DOHSA in 

2000 to make loss of society recoverable by the survivors, the victims of commercial aviation disasters. 

Mr. DEUTCH. Mr. Chairman, before I yield back, I would just like 

to again thank Mr. Jones and give Mr. Jones my commitment that 

I will work with you, Mr. Chair, and this Committee to do what 

we need to do in an effort to amend DOHSA so that you and the 

other families can receive the appropriate respect that you deserve 

under law. 

I yield back, Mr. Chairman. 

Mr. CONYERS. Judge Charles Gonzalez of Texas. 

Mr. GONZALEZ. Thank you very much, Mr. Chairman. 

First to Mr. Jones and his son Chris, you are lawyers, most of 

us up here are lawyers, lots of lawyers are witnesses today, and we 

are taught that words are powerful, and they can convey a mesVerDate Aug 31 2005 15:09 Nov 29, 2010 Jkt 000000 PO 00000 Frm 00180 Fmt 6633 Sfmt 6601 H:\WORK\FULL\052710\56642.000 HJUD1 PsN: 56642
177 

sage, and they can express every human emotion—until you experience what you have experienced, and then we know they are not. 

As inadequate as the words are that you may find from Members, 

it is sincerely felt. I just wish there was a way we could convey 

them adequately. 

Let us talk about adequacy. It is something that Mr. Jones 

brought up. His statement was about responsibility, liability. What 

is the law supposed to accomplish? Coming full circle, because we 

started off with Mr. Conyers’ opening statement, what is the jurisdiction of this Committee? There are many things that we have 

asked today, and we may not be able to do much about them, but 

there is something we can do about the laws that govern the parties, the laws that allow remedies to the victims of what transpired 

in the Gulf, and looking at things prospectively. 

So my question is going to be just to a few of you, I am going 

to assume certain things, and I am going to ask that you assume 

them with me, that the purpose of law would be two-fold. I am 

going to try to make it as simple as possible, and I am going to 

follow up on something that Mr. Deutch touched on. But if the law 

is to accomplish anything, it would be two things: One, it instills 

responsibility because of liability. That is human nature. The law 

does not assume that people are just going to do the right thing. 

The law is not going to assume that a party is not going to be negligent. It assumes negligence. It assumes carelessness. It assumes 

acts that are intended, actually. That is what we have to prepare 

for. 

Now, there are consequences to those; they are called victims. 

And so what the law then proposes to do is to make the victim 

whole. That is justice. So it is really simple. 

I think we all started off in law school kind of understanding 

those concepts, and we lost our way somewhere along that whole 

process. But nevertheless, if we apply that test, and we look at 

what we have today in the way of laws governing incidents that 

have occurred in the Gulf, and I would say may occur again—hopefully not to this degree, but we know there will be accidents—are 

the laws that are presently on the books adequate, adequate to instill responsibility, and adequate to make victims whole for their 

losses? 

Mr. Willis, I know you are not a lawyer, but I am still going to 

ask you, do we need to amend the laws that govern instances of 

this nature? 

Mr. WILLIS. Representative Gonzalez, you are right, I am not a 

lawyer, but what I will say to you is one of the things I worked 

very hard to understand, as I have been involved in this process, 

is what the law is around the damage that is being caused by this 

spill. What I can tell you is whatever the law is, BP is going to follow it. I have said and I will keep saying that we are going to go 

past this $75 million cap because it is just not going to be enough 

to repair the damage that is being done by this oil well that has 

been flowing into the Gulf of Mexico. We are going to follow the 

law. 

Mr. GONZALEZ. It goes way beyond the $75 million. It goes into 

the types of remedies, the types of causes of action, the elements 

of damages. I mean, this goes way beyond certain numbers. 

178 

And I don’t mean to pass over Mr. Hood: What is your opinion? 

Do we need to amend the laws? You have asked us to, so I assume 

your answer is going to be yes? 

Mr. HOOD. Yes, sir. And I have attached our comments about five 

different ways that we thought would benefit the States just to protect the States’ interests and the damages that we may be subject 

to incur. 

What affects the States also, some of these amendments, also affects these individual claimants from Mississippi. I mean, a company, by the time this thing is over, I suspect will have caused 

damage to hundreds of Mississippians. Yet they, under the Class 

Action Fairness Act or different Federal procedural moves, they 

will have them in your State, Mississippi claimants, because a company has come to Mississippi and caused damage, down there in 

a multidistrict litigation or a class action court, and that court will 

decide categories of people, their damages, and they don’t get— 

some will get more than they should, and some will get less than 

they should. And I think everybody ought to be paid what they are 

owed, and that is it, no more. 

I would ask the Committee in addition to considering the proposed amendments that I have proposed expressly dealing with 

States, excepting States from cap, I would ask the Committee to go 

back and look at the Class Action Fairness Act and some of the 

abuses that are occurring by Federal judges just to get a case settled. When you have thousands of cases, it is human nature, you 

are going to try to do everything you can to force a settlement, and 

then people are left out, and it is not fair. It is not a fair process. 

Other than those written things that I have mentioned, I think the 

professor was dead on on some of the inequities among the different admiralty acts as well. 

Mr. GONZALEZ. Ms. Clingman, present law is adequate or inadequate? 

Ms. CLINGMAN. Congressman, I am an attorney, and I take the 

laws as Congress has enacted them and then make my legal recommendations based on the facts. We are not there yet in the case 

because we don’t have the facts, and I would urge Congress to have 

that same deliberateness in finding out first what has happened. 

It is inherently imperfect to compensate losses like this, the loss 

of human life, the loss of livelihood, the loss of recreational beach 

shore, with money. However, I do believe the U.S. justice system 

is the best in the world, and our U.S. justice system has dealt with 

complexities, torts, loss, damages for more than 100 years, and has 

done it very well. So I would encourage this Committee and other 

Members of Congress to let the judicial system do its job, to let the 

U.S. Coast Guard do its investigative job, and then to take, as we 

will in looking at our liability, a deliberate look at the legal regime 

and see if any changes need to be made. 

Mr. GONZALEZ. But the courts can only apply the laws that we 

enact. And if we restrict recoveries, we restrict causes of action, we 

restrict damages, we cap, we limit, do we need to be addressing 

that so that we can give the courts maybe a little bit more latitude 

to address what are legitimate complaints, legitimate damages, and 

losses? 

179 

See, I tend to believe we are going to do something. What we 

have in place today, it is antiquated, obviously; but it is just not 

fair. I understand what you are saying, we can let this thing play 

out, but I am not sure that is exactly going to happen because 

there are some glaring shortcomings as we even start the process. 

I will ask Mr. Ferguson, is the law adequate or inadequate? 

Mr. FERGUSON. Well, I think we are certainly going to find out. 

And the lesson that is learned from that is going to drive the policy 

that determines how do we change these laws. The position we are 

in is that our policy is we comply with laws. If the laws are 

changed, we are going to comply with the way they are changed. 

It is clear that there is issues that are immediately obvious from 

what is happening here. It is up to Congress to address that policy 

and to change those laws as appropriate. 

Mr. GONZALEZ. And I know, Mr. Foley, you have touched on it. 

You have said sometimes there are reasons that laws may look 

somewhat inadequate because they need to promote what might be 

commerce and such. And to some extent I might even agree, and 

I am not going to totally disagree with the Ranking Member Mr. 

Smith, my neighbor in San Antonio, but I don’t think this would 

be the death knell of drilling. It would just have a little more justice in what is available to folks. 

I will ask the professor, and I don’t want to put words in your 

mouth, but I assume that you are saying, just as the attorney general is, ‘‘you guys need to change the laws and make them a lot 

more fair.’’ 

Mr. GALLIGAN. Yes. Obviously there will need to be investigations, and the facts still have to come out. But the laws in this area 

are imperfect. 

You said it. Tort law ought to be about fairness. Aristotle called 

it corrective justice. It ought to compensate people to make them 

whole. If we don’t compensate for loss of society in maritime wrongful death cases, we are not making them whole. Tort law ought to 

deter. It ought to encourage appropriate, efficient investments in 

safety. If we undercompensate, by definition we underdeter, and 

the Limitation of Liability Act of 1851, which applies to the personal injury and wrongful death claims here, is a further potential 

underdeterrent because it is a further potential limitation of liability. 

Mr. GONZALEZ. Thank you very much. 

I yield back, Mr. Chairman. 

Mr. CONYERS. I thank the witnesses for their endurance and 

their testimony. We will have 5 days in which questions may be 

submitted to you that we ask be returned, and 5 days for any additional materials that might be submitted. 

I introduce into the record written materials from Michael Russell and Steven Gordon. 

[The prepared statement of Mr. Russell follows:] 

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PREPARED STATEMENT OF MICHAEL RUSSELL


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[The prepared statement of Mr. Gordon follows:] 


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Mr. CONYERS. We thank you very much, and we declare this 

hearing at an end. 

[Whereupon, at 2:50 p.m., the Committee was adjourned.] 


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