American Commercial Lines, LLC v. United States

Congress passed the Oil Pollution Act of 1990 (“OPA”) in response to the Exxon Valdez oil spill to “streamline federal law so as to provide quick and efficient cleanup of oil spills, compensate victims of such spills, and internalize the costs of spills within the petroleum industry.” Rice v. Harken Expl. Co., 250 F.3d 264, 266 (5th Cir. 2001). OPA authorized the use of the Oil Spill Liability Trust Fund (“OSLTF”), funded through taxes and penalties assessed on the petroleum industry, to fund uncompensated removal costs and damages resulting from an oil spill. 26 U.S.C. § 9509; see also Great American Ins. Co. v. United States, 55 F. Supp. 3d 1053, 1059 (N.D. Ill. 2014). Under OPA, a responsible party is entitled to limit its liability to a specified dollar amount based on the tonnage of the vessel from which oil is spilled, unless the United States can establish an exception to the general limitation of liability applies. 33 U.S.C. § 2704(a)-(c). The question presented is whether the courts below erred when they denied American Commercial Lines LLC (“ACL”), the owner of the inland tank barge DM 932, limitation of liability under section 2704(c) of the Oil Pollution Act of 1990. The lower courts held that the secret, illegal acts of third-party towing company, DRD Towing Company, LLC (“DRD”) and DRD employees Terry Carver and John Bavaret which led to the collision between the barge DM 932 and the M/V TINTOMARA, were actions that were taken “pursuant to” to the charters between ACL and DRD.