Ninth Circuit Rules in Favor of Exxon in Lingering Case from Exxon Valdez Oil Spill

In an unpublished decision, the Ninth Circuit Court of Appeals ruled in favor of Exxon Mobil Corporation and Exxon Shipping Company (collectively “Exxon”) on the amount of pre-judgment and post-judgment interest to be paid on a prior settlement. See Nautilus Marine Enterprises, Inc. v. Exxon Mobile Corporation, No. 17-35337, 17-35278 (9th Cir. July 18, 2018).

Claimants, Nautilus Marine Enterprises, Inc. and M. Thomas Waterer (collectively “NME”) sued Exxon for damages arising from the 1989 Exxon Valdez oil spill. In 2006, the parties entered into a settlement agreement. Exxon agreed to pay NME for damages incurred in 1992 and 1993. The parties disagreed on the amount of interest to be paid, and have been litigating the issue ever since.

The district court held that NME was entitled to pre-judgment interest through November 1, 2006, as per the parties’ agreement. NME argued the court erred in limiting the interest period and argued for a larger award which includes a longer period of interest. On appeal, the Ninth Circuit affirmed the district court, finding that by executing the agreement, NME agreed to limit its recovery of pre-judgment interest to this period. Both the district court and the Ninth Circuit strictly interpreted the parties’ prior agreement.

The district court awarded post-judgment interest running from the issuance of its February 14, 2017 judgment. NME argued post-judgment interest should have accrued from the date a prior 2007 judgment was entered. The 2007 judgment was appealed by Exxon, and was subsequently reversed and vacated. The Ninth Circuit again affirmed the district court, holding post-judgment interest runs from the final 2017 judgment, not from the earlier judgment which was vacated.

In rendering its opinion, the appellate court considered argument from Exxon that the district court violated the best evidence rule when it considered testimony of NME’s counsel about how settlement payments would be allocated. In a declaration, NME’s counsel referenced several written agreements, which were never provided to the court. The Ninth Circuit ultimately determined the district court’s consideration of this testimony was harmless and likely did not change the outcome of the case.

To read the full opinion of the Ninth Circuit, please click here.

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