Thursday, March 8, 2012

Shell Oil Company, Et Al v. U.S.

Mar 7: In the U.S. Court of Appeals, Federal Circuit, Case No. 2010-5161. Appealed from the United States Court of Federal Claims. As explained by the Appeals Court, the case is an appeal from a decision of the Court of Federal Claims requiring the United States to indemnify certain oil companies for environmental cleanup costs under the Comprehensive Environmental Response, Compensation, and Liability Act of 1978, 42 U.S.C. § 9601, et seq. (CERCLA). The Court of Federal Claims initially entered judgment in favor of all four plaintiffs in this litigation: Shell Oil Company, Atlantic Richfield Company, Texaco Inc., and Union Oil Company of California (collectively, the Oil Companies). Upon discovering that his wife had a financial interest in the parent company of Texaco and Union Oil, however, Judge Loren A. Smith: (1) vacated his 2008 and 2009 summary judgment rulings in favor of the Oil Companies; (2) sua sponte severed Texaco and Union Oil from the lawsuit and directed the clerk of court to reassign their claims to a different judge; (3) reinstated his prior summary judgment decisions with respect to Shell and Arco only; and (4) entered final judgment against the government in the total amount of $68,849,505.88.
    The government appeals from the Court of Federal Claims' decision entering final judgment in favor of Shell Oil and Arco, and seeks reversal on a number of grounds, including the trial judge's treatment of the discovered financial conflict. The Appeals Court rules, "Because we find that the presiding judge was required to recuse himself under 28 U.S.C. § 455(b)(4), and that vacatur is appropriate in the circumstances of this case, we vacate the final judgment and the summary judgment orders on which it was premised, and remand with instructions that this case be reassigned to a different judge."
    The Appeals Court explains further, "Because we find that the trial judge's failure to recuse in this case was not harmless error, particularly given the risk of injustice and risk of under-mining the public's confidence in the judicial process, we conclude that the appropriate remedy is to vacate the district court's orders and remand the case."
    Access the complete opinion (click here). [#Remed, #CAFed]
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