Huntington Beach oil spill settlement wins final approval
A federal judge in Santa Ana signed off final approval of a $50 million settlement of a lawsuit involving the pipeline oil leak that gushed thousands of gallons of crude into the ocean off Huntington Beach in 2021.
U.S. District Judge David O. Carter gave final approval to the lawsuit against Amplify Energy. The agreement won preliminary approval in September, but the attorneys and judge waited for any objections before final approval and there were none.
"Not a single objection," attorney Wylie Aitken, who was lead counsel for the plaintiffs after the hearing. "Not one person of all three classes made an objection. That's the first time I've ever seen that."
Aitken told Carter during the hearing that while they couldn't solve all of the issues that led up to the rupture of the pipeline -- such as where cargo ships are allowed to park off the coast -- but, he added, "We can heighten awareness" to the authorities who can do something about it.
"I'm kind of amazed that this court's good pressure got all this resolved" so quickly, Amplify attorney Daniel Donovan told Carter.
Carter praised all of the attorneys who worked on the case along with the special masters who helped them.
Another significant improvement was that when a leak is observed a notice will go out to everyone involved all at once instead of relying on a chain of people, Aitken said.
Another key to the settlement is the way claims will be paid out, Aitken said. A system was worked out so that the fishers and other merchants affected by the oil spill will get checks directly without having to fill out a claim form, Aitken said.
He said that it was easy to do with the fisheries because "they keep such detailed records." But it will be more challenging in the tourism industry. For hotels it was easier because they can count rooms not rented, but for other small businesses they will have to fill out some sort of claim form and the deadline for that is June 9, so more notices will go out again soon, he said.
Of the $50 million Amplify Energy will pay to settle the lawsuit, $34 million will go to a class of fishers, $9 million will go to property owners and about $7 million goes to the tourism industry such as whale watching companies, Aitken said.
Amplify agreed to increase staffing on the Elly platform to provide for three control room operators (an increase of one per crew) and three plant operators (an increase of one per crew) over the next three years.
The next big step is preliminary approval of a $45 million settlement with the two shipping companies that damaged the pipeline, the MSC Danit and M/V Beijing, Aitken said. An agreement has been reached, but Carter must grant preliminary approval and then barring any objections it will be finally approved later, Aitken said.
Also, last year, Amplify Energy settled criminal cases in state and federal court and agreed to pay fines. The company agreed in federal court to pay a $7.1 million fine and $5.8 million to reimburse the U.S. Coast Guard for expenses from the October 2021 spill and also agreed to pay $4.9 million in fines to resolve a misdemeanor complaint in state court.
The pipeline, which is used to carry crude oil from several offshore drilling platforms to a processing plant in Long Beach, began leaking the afternoon of Oct. 1, 2021, but oil continued to pump through the line until the following morning, authorities said last year.
All told, about 25,000 gallons of oil seeped into the ocean from the ruptured 16-inch pipeline, which is submerged about 4.7 miles west of Huntington Beach. The leak forced the cancellation of the popular Huntington Beach Airshow, which was underway when the spill was detected. Beaches were closed up and down the Orange County coast as crews worked to contain the crude oil.
Federal investigators have said the pipeline appeared to have been damaged by a ship's anchor, likely belonging to one of dozens of cargo ships that were backlogged over a period of months outside the Los Angeles-Long Beach port complex.
More than a dozen companies doing business in the region sued Amplify Energy Corp. for damages resulting from the spill.
Fishing resumed in late November 2021 along the Orange County coast, following a two-month shutdown of fisheries due to the spill. The fishing ban encircled 650 square miles of marine waters and about 45 miles of shoreline, including all bays and harbors from Seal Beach to San Onofre State Beach, officials said.
