Transocean Can’t Sue U.S. for Gulf Spill: Judge

By Margaret Cronin Fisk and Allen Johnson Jr. - Nov 19, 2011 6:04 AM GMT+0700

Transocean Ltd. (RIG) can’t sue the U.S. government for partial fault in the 2010 blowout of BP Plc (BP/)’s Macondo Well in the Gulf of Mexico and subsequent oil spill, a judge said.

“The U.S. has sovereign immunity here,” U.S. District Judge Carl Barbier said today at a hearing in New Orleans in dismissing a claim brought by Transocean in a lawsuit. The company can still present evidence of such allegations at trial in an effort to limit any damages against it, Barbier said.

Transocean filed its claim against the U.S. in February, contending the incident may have been caused in part by the acts of federal agencies and government employees. Transocean was seeking a credit or offset on any prospective damages assessed against the company in the lawsuits.

U.S. lawyers argued that the government wasn’t liable for the spill. “It was at all times the responsibility of the private parties involved in the oil drilling venture to comply with federal safety regulations, including maintaining control of their well,” the U.S. said in a May response to Transocean’s claim.

The Macondo well blowout and the explosion that followed killed 11 workers and set off the worst offshore oil spill in U.S. history. A trial on liability for the explosion and spill is set for Feb. 27.

‘Allocation of Fault’

“I think it is clearly understood by all parties that there will be no allocation of fault” to the U.S. “in this trial, although that does not preclude evidence of conduct coming in at trial,” Barbier said at today’s hearing dismissing a motion by spill victims to exclude such evidence.

“The ruling addressed procedural aspects of the pleadings,” Brian Kennedy, a Transocean spokesman, said in an e-mail. “It does not impact the evidence that can and will be presented or the manner in which the court will consider the case. As the court said today, Transocean has both the right and ability to submit such evidence for credit against potential damages.”

The accident and spill led to hundreds of lawsuits against London-based BP and its partners and contractors including Transocean, the Switzerland-based owner and operator of the Deepwater Horizon drilling rig that exploded; Halliburton Co. (HAL), which provided cementing services; Cameron International Corp. (CAM), which provided blowout-prevention equipment; and BP’s minority partners in the well, Anadarko Petroleum Corp. (APC) and Mitsui & Co.’s Moex Offshore LLC unit.

The case is In Re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporters on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net; Allen Johnson Jr. in New Orleans at allenmct@gmail.com.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.