Wednesday, April 17, 2024

Louisiana agency gave authority over coastal litigation to outside counsel

by BIZ Magazine

By Victor Skinner | The Center Square contributor

he Louisiana Department of Natural Resources delegated authority over coastal drilling litigation to a personal injury attorney rather than investigate claims of regulatory violations at the center of the lawsuits.

In an April 2023 deposition, DNR Secretary Thomas Harris admitted under oath that instead of investigating allegations against oil and gas companies before joining lawsuits claiming damage to the coast, he allowed law firms representing parishes that benefit from the case to do the work.

The deposition, exposed by the Pelican Institute through a public records request, involves one of 43 ongoing lawsuits filed against hundreds of oil and gas companies: Parish of Cameron v. Auster Oil and Gas, Inc., et al.

The lawsuit was filed in November 2013 but the DNR did not petition to intervene until April 2016, just months after Gov. John Bel Edwards took office and appointed Harris to lead the DNR. The department, with a budget of more than $60 million that employs over 300, did not have the manpower to investigate the claims, Harris testified.

On April 20, Chevron attorney Michael Phillips asked: “I’m saying you’ve made a choice, rather than the agency taking on the responsibility for enforcing permits under the applicable laws and regulations, you have farmed out that responsibility to private lawyers representing the parishes?”

“Yes,” Harris said. “And really don’t have an option of – basically, I’m faced with the choice of not issuing any new permits and – or taking new enforcement action and dedicating our entire staff to doing this review, or farming it out. And the decision made was the latter.”

Harris confirmed the administrative process requires the DNR to inform oil and gas companies in Louisiana of violations to give them an opportunity to correct course, but he opted instead to join the lawsuit.

Harris acknowledged the decision is “inconsistent because we’re not following the administrative process at all.”

“Secretary Harris’ testimony is concerning,” said Sarah Harbison, general counsel at the Pelican Institute. “It makes you wonder what’s happening every day in the department.”

In October, the DNR revived a stalled $100 million settlement in another related lawsuit involving Freeport-McMoRan Inc. by signing the agreement on behalf of several parishes that refused to participate.

Cameron v. Auster has a trial date set for November.

“The Legislature does have some oversight to investigate the DNR and whether the state continues in the lawsuit,” Harbison said. “Certainly, the next governor could do something about it.”

Research from the Pelican Institute shows the state lost 2,000 jobs two years after the first coastal lawsuits were filed in 2013, resulting in $70 million in lost wages. The policy group estimates between $43 million and $113 million in annual economic losses since the lawsuits were filed, which equates to a $22.6 million loss for state and local governments for schools, roads and other infrastructure.

Harbison contends the “corruption” exposed by the April deposition “is just one of many reasons that Louisiana needs fundamental government reform in order to set the state on the right track – and to ensure Louisiana’s comeback.”

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