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Sen. David Vitter has formally thanked Gov. Bobby Jindal for signing into law a legacy lawsuit solution passed by the Louisiana Legislature.

“I want to thank the state Legislature for passing this strong solution to the legacy lawsuit issue which Governor Jindal signed into law,” Vitter (R-La.) said. “It will help clean up real contamination and shut down the trial lawyer bonanza, which has been hurting job creation in our energy sector.  [The solution] happened for one reason – legislators did their job, faced a tough issue and voted the right way in the House, and in the Senate.”

Legacy lawsuits proved to be a contentious issue for legislators during their 2012 regular session. The state Senate and House of Representatives ultimately accepted a procedural compromise presented by state Sen. Bret Allain.

“Landowners wanted more oversight,” Allain (R-Jeanerette) said after presenting SB-731 an alternative to HB-618 in April. “So what I did was set up as an oversight committee comprised of the Department of Natural Resources, Commission of Conservation, Department of Environmental Quality, Wildlife and Fisheries, Department of Agriculture, Department of Health and Hospitals and, in coastal parishes, and the Coastal Protection and Regulation Authority. “

Allain argued that by giving each agency a say in the matter, individual cases would be fully addressed without landowners and oil companies having to come back later to address added complaints.

Throughout legislative debate, Vitter argued that a stalemate regarding legacy lawsuits favored trial attorneys who he said seek millions in damages, above actual cleanup costs.

“The Louisiana Oil and Gas Association would like to give particular praise to Sen. Vitter for his leadership as a driving force that resulted in this much-needed solution to these frivolous legacy lawsuits,” LOGA President Don Briggs said. “While this was not a Capitol Hill battle, Sen. Vitter made his voice heard in our home state of Louisiana. These two pieces of legislation successfully passing out of the state legislature would not have been possible without his willingness to speak out on behalf of the industry and keep the issue on the forefront of the public debate.”

“The Louisiana Landowners Association appreciates that the Governor’s Office has helped to achieve this compromise,” Louisiana Landowners Association Executive Director Paul Frey said. “We add a special thanks to Sen. Allain who is a key advocate for landowners.”

“To reach a compromise, it was important that we came to a balance that enables us to continue to lead the country in energy production and also be good stewards of the environment,” Natural Resource Secretary Scott Angelle said in the news release from the governor’s office. “This compromise provides for transparency in the process, accelerates clean up of the environment and protects innocent parties from punitive damages.”

Vitter highlighted key components that he fought for and that became part of the solution. The senator’s contributions to legislation allows operators to accept responsibility and be credited for cleaning up sites, calls for pretrial public hearings and makes sure the clean-up plan is publicly available and admissible in court.

The term legacy lawsuits refer to claims brought by landowners against oil and gas operations in relation to contamination of property related to drilling and extraction sites.  These lawsuits are often filed against every operator who has ever worked a section of property.

Until now, lawsuits could include multiple companies, even if some lease-holding companies are not the ones responsible for contamination that occurred prior to their ownership.

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The governor also signed a pair of bills — House Bill 618 and Senate Bill 555 — that will change the complex legal process for dealing with so-called “legacy lawsuits” that seek millions of dollars in damage claims and that the oil and gas companies claim are stymieing energy exploration in the state.

At issue is the state’s procedures for cleaning up environmental damage to property caused years ago when energy companies searched, developed and exploited oil and natural gas fields. Following acceptable procedures of the time, the energy companies often left messes on-site, then sold the leases to others, usually smaller oil companies.

Landowners contend that litigation, which carries the threat of an expensive verdict, seems the only motivation to get the oil companies to clean up.

Big oil companies counter that agreeing to a cleanup opens them to much larger verdicts for less documented damages, such as financial losses from being unable to use the land.

In order to accelerate cleanup, the compromise outlined in SB555 and HB618 would allow a party to admit responsibility for environmental damage and to clean it to the regulatory standard.

The changes would set certain benchmarks and timelines in handling cases.

Once the oil company admits responsibility, the Department of Natural Resources would draft a feasible cleanup plan, according to the two bills. Two other agencies, the Department of Environmental Quality and the Department of Agriculture, would also weigh in on the cleanup plan.

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The 90-day 2012 Louisiana legislative session has come to a close. While most sessions have their ups and downs, this particular session was an all-out battle for the oil and gas industry. Several pieces of legislation were filed that would have been injurious to the industry, and numerous other bills were filed that would benefit the industry and offer new ideas of how to better the future of oil and gas in Louisiana. Overall, the bad bills were killed and the good bills were passed, and the oil and gas industry is pleased at the outcome.

Specifically, the oil and gas industry was able to work with the necessary legislators and stakeholders to pass two bills designed to reduce the backlog of the so-called “legacy lawsuits” and speed up remediation of landowners’ properties. House Bill 618 by Rep. Neal Abramson and Senate Bill 555 by Sen. Robert Adley have now passed out of both chambers and are on their way to the governor’s desk for his signature. State Representative Gordon Dove (R-Houma) was recently quoted in reference to the new legislation as saying, “It allows oil companies to take responsibility for the environmental portion of the site only, clean it up and have that admissible in court.” The Legacy issue has caused, according to a report released by the LSU Center for Energy Studies, the loss of nearly 1,200 new wells in Louisiana, translating to an astonishing $6.8 billion dollars in lost drilling investments, and the forfeiture of over 30,000 jobs.

Also an ultra-deep units bill, HB 504, passed allowing the Department of Natural Resources to consolidate leased lands so operational costs for ultra-deep drilling exceeding 22,000 feet could be shared. This bill enhances drilling in the southern portion of the state of Louisiana allowing for new economic development to take place. Not only will this bill help bring about new jobs directly tied to the drilling itself, but it creates a ripple effect for that region adding jobs to industries such as the hotel, restaurant and transportation sectors.

Other positive pieces of legislation were passed pertaining to hydraulic fracturing, water usage, coastal restoration and alternative fuel for vehicles. Individually, these bills each touch the process of how oil and gas companies conduct their day-to-day activities. If

regulations are set at appropriate levels, the oil and gas industry is able to focus on exploration and production and not be bogged down by the red tape of laws that only hinder operations. When the industry is able to work with the legislators and come to peaceful compromise, we get the opportunity to see our democracy at work.

While this session brought about countless conversations, negotiations, and compromise, the end result was positive for the oil and gas industry.

The next step in the process is for the necessary bills to be signed into law, and the industry move forward in a positive direction, not only for oil and gas, but also for the entire state of Louisiana.

Don Briggs is president of the Louisiana Oil and Gas Association (LOGA).

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1 of the most acrimonious issues facing Louisiana lawmakers this session has wrapped up.

The House gave final, unanimous passage Thursday to compromise legislation involving a dispute between the oil and gas industry and landowners over how to clean up environmental damage done in drilling years ago.

The pair of bills will change the complex legal process for dealing with so-called “legacy lawsuits” that seek millions of dollars in damage claims and that the oil and gas companies claim are stymieing energy exploration in the state.

Supporters say the changes will require companies to start cleaning damaged areas to regulatory standards, while other, more extensive damages claims can be pursued in the courts. Certain benchmarks and timelines will be set in handling cases.

The bills head to the governor’s desk.

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The brokering of an agreement over how to handle lawsuits involving environmental damages from oil and gas drilling removes Louisiana Gov. Bobby Jindal from an uncomfortable position.

Jindal had allies — and big-money campaign donors — on both sides of the issue.

Also, the dispute threatened to highlight an often unknown and awkward alliance for a Republican: Jindal has received thousands of dollars in campaign donations from trial lawyers, who are often at odds with business groups and who are regularly considered Democratic allies.

At issue are so-called legacy lawsuits that seek millions of dollars in damage claims, filed by landowners who leased their property to energy companies and claim environmental damage from the drilling, such as contamination of ground water resources, that limit their ability to use the property.

The oil and gas industry says the lawsuits are stifling exploration in the energy-rich state, and they accuse trial lawyers of dragging out the suits to maximize profits.

Landowners and the trial lawyers who represent them accused the oil and gas companies of trying to push bills that would give the industry a more favorable legal environment that will keep them from paying what they owe for the contamination.

The last time the issue reached a fever pitch at the Louisiana Capitol was six years ago.

Then, the matter uncomfortably put legislators in the midst of a dispute between multiple sets of powerful lobbying groups and campaign donors: landowners, trial lawyers and one of Louisiana’s biggest industries, oil and gas.

Jindal faced the same dilemma this time as dozens of bills were filed to again change the complex legal process for dealing with the lawsuits, amid criticism the last agreement didn’t work out as intended.

The Republican governor has regularly talked of his strong support for the oil and gas industry.

But on the other side of the dispute was the governor’s former executive counsel, Jimmy Faircloth, and Jindal’s big-money contributor Roy O. Martin, whose company in Alexandria is the largest private landowner in the state with thousands of acres and pending legacy lawsuits.

Also in the mix were trial lawyers, who have given Jindal’s campaign account at least $290,000 in the last election cycle.

Jindal tried to stay out of the fray, putting his natural resources secretary, Scott Angelle, as the point man for negotiations. But the governor then faced criticism from the state’s other top Republican leader, U.S. Sen. David Vitter, who suggested Jindal wasn’t doing enough to resolve the issue.

Vitter sent out emails and statements declaring the current situation a “trial lawyer bonanza,” and suggesting that if Jindal didn’t intervene, the lawsuits could cost the state thousands of lost jobs.

The pressure immediately lifted with the announcement that a compromise had been reached.

Angelle said the agreement will require companies to start cleaning damaged areas to regulatory standards, while other, more extensive damages claims can be pursued in the courts.

The changes would set certain benchmarks and timelines in handling cases. Existing cases already set for trial wouldn’t be included in the reworked legal provisions.

The proposal would allow cleanup plans devised by the state Department of Natural Resources to be admissible as evidence in a lawsuit for a larger damage claim, a move sought by the energy industry.

Two other agencies, the Department of Environmental Quality and the Department of Agriculture, would also weigh in on the cleanup plan. That addresses complaints from landowners who said the industry has too heavy an influence over DNR and could pressure the agency in cleanup estimates that would be reviewed to determine damages.

The Louisiana Landowners Association, Louisiana Oil and Gas Association and Louisiana Mid-Continent Oil and Gas Association all indicated they support the language included in the two bills.

And with that, the compromise bills sailed through the Senate. They’re set for House debate Thursday, and House Speaker Chuck Kleckley, R-Lake Charles, said he expects no problems with them reaching final passage.

So, the uncomfortable dilemma for Jindal has ended — as long as the compromise sticks.

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State senators Wednesday unanimously endorsed a House-passed bill that addresses the civil court side of cleaning up abandoned oil and gas exploration and production sites that polluted landowners’ property.

HB618 by Rep. Neil Abramson, D-New Orleans, drew considerable opposition from landowners when it was considered in the House.

Landowners frustrated with not getting their land restored once production was completed have brought civil actions, known as legacy lawsuits, against producers, and some of the suits involve millions of dollars. Often, the drilling leases have been passed among several companies, so identifying the original polluter could be difficult.

There was no opposition in the Senate, where Sen. Robert Adley, R-Benton, said the bill deals with “the civil side that sets up the environmental management” of the legacy lawsuit issue.

Adley’s SB555, considered a compromise between landowners and industry officials dealing with the physical side of cleaning up polluted sites, is awaiting a hearing in the House.

Abramson says the purpose of his bill is so “oil and gas companies can admit fault and go out there and clean it up as soon as possible.”

The bill says that if an oil or gas company involved in a lawsuit admits liability for the pollution, the Department of Natural Resources’ Office of Conservation is to draw up a cleanup plan and submit it to a judge for approval.

Sen. Francis Thompson, D-Delhi, questioned Adley about a major difference between the two bills — involvement of the Department of Environmental Quality and Department of Agriculture in approving a cleanup plan.

Adley said the two bills work together, so the departments mentioned in his bill would be involved in approving the actual cleanup plan that’s submitted to a court.

Adley attached a two-page amendment to Abramson’s bill in the Senate Natural Resources Committee, so it now goes back to the House for concurrence.

The amendment deals with the landowner granting access to the property so an investigation of the pollution can be performed, doing the environmental testing and setting a 30-day timetable for the testing to be done. It also requires that the responsible party pay all costs of testing and cleanup.

Those provisions were in the original bill but have been restated.

The new provisions would not affect any case that went to court on or before May 15.

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A compromise between the oil and gas industry and landowners who want energy production pollution cleaned up on their property on how to clean it up is headed to the House for consideration.

The Senate voted 30-0 Monday for Senate Bill 555 by Sen. Robert Adley, R-Benton, which spells out steps that enable energy producers to admit fault and clean up “legacy” sites — ones that have existed for years and possibly were caused by oil or gas companies that are no longer in business.

Their admission for cleanup purposes, though, could not be used as an admission in a civil suit for damages.

The compromise bill includes items both sides of the issue want.

Oil and gas companies have complained that they have been dragged into court and had to pay lawyer fees when no actual damage exits. The bill allows for them to go to court and have an investigation of the property to determine if there is damage.

Landowners have complained that the Office of Conservation in the Department of Natural Resources is too close to the industry, so any cleanup plan they developed could be less than the landowner desires.

SB555 calls for DNR, the Department of Environmental Quality and the Department of Agriculture to serve on a committee to judge whether cleanup plans are appropriate. With their approval, a plan would go directly to the court handling the lawsuit.

Adley told the Senate that it needs to also approve a House-passed bill, HB618, by Rep. Neil Abramson, D-New Orleans.

“The Abramson bill deals with what goes on in the courtroom,” he said. “Mine deals with developing the plan.”

Adley said that there’s no conflict between the bills because SB555 deals with natural resources law and HB618 is deals with civil suits.

Sen. Gerald Long, R-Winnfield, chairman of the Senate Natural Resources Committee, said “countless hours went into making this workable plan.” He credited freshman Sen. Bret Allain, R-Franklin, for standing up for landowners and helping forge the bill.

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With the clock winding down on an acrimonious legislative session, lawmakers appear to have settled on a new framework for environmental damage lawsuits that landowners file against energy companies that once leased their property.

The crux of the deal, which lobbyists for landowners and the business lobby both endorsed Thursday, would allow a defendant in a so-called “legacy lawsuit” to claim responsibility for environmental damage as defined under the state’s environmental regulations without admitting any liability for damages beyond the regulatory cleanup.

Now the question is whether the two-bill package approved by the Senate Natural Resources Committee has time to clear the legislative process by the June 4 final adjournment. House Bill 618 by Neil Abramson, D-New Orleans, needs only final Senate approval and a return to the lower chamber of concurrence on changes. But Senate Bill 555 by Robert Adley, R-Benton, still must clear the full Senate and go through a committee hearing and floor debate in the House.

The high-profile fight has for many years pitted the industry lobby — from international oil giants to Louisiana-based independent producers — against landowners, including Louisiana’s largest corporate and individual landowners, Weyerhauser Corp. and Roy O. Martin III of Alexandria. In Capitol parlance, it’s billionaires vs. millionaires, and hearings on the matter drew most of the state’s top contract lobbyists, in addition to in-house corporate lobbyists and association chiefs.

The dispute, which has made lawmakers uncomfortable because of the money and influence on both sides, has also exposed another fault line between U.S. Sen. David Vitter and Gov. Bobby Jindal. Vitter had accused his fellow Republican of coddling plaintiffs’ attorneys at the expense of the energy industry, a leading employer in Louisiana. Jindal’s former executive counsel, Jimmy Faircloth, was the lead lobbyist for Weyerhauser and Martin. On Thursday, after Jindal’s Secretary of Natural Resources Scott Angelle sat the table with Faircloth and oil industry representatives to announce a deal on a two-bill package, Vitter offered the governor faint praise: “I really congratulate Bobby for coming around and supporting this strong solution.”

Juries typically hear both the regulatory claims (effects, such as open waste pits, that are subject to state environmental regulations) and the additional private claims (such as crop damage or lost economic opportunity) in the same case. Energy and business lobbyists frame many of the suits as unfair attacks in which landowners name as defendants every producer that has ever worked on a piece of land, with responsible parties not being able to admit limited liability and pay to cleanup polluted sites. Vitter has repeatedly called the suits a “trial-lawyer bonanza.”

The Abramson-Adley plan is a significant departure from current law, which leaves it to a jury in district court to decide responsibility for regulatory and private damages. State regulators get involved in crafting a remediation plan for regulatory damages only after a case is settled or a verdict assigns responsibility. In either instance, a judge has final approval.

Under the proposed agreement, the state Department of Natural Resources would be responsible for crafting a reasonable plan, even as litigation continues. In a nod to landowners, other state regulators from the Department of Environmental Quality and the commissioner of agriculture’s office would also be able to comment on remediation plans. The proposals would allow the plan — with the associated costs of the cleanup — to be admitted as evidence once a case gets in front of a jury. Faircloth, arguing for landowners, had previously told lawmakers that such a deal could bias a jury as it considers private damages.

The two bills work in concert but must be separate, according to officials, because Adley’s deals with the state mineral code, while Abramson’s deals with civil procedure.

A handful of critics of the deal said that the Abramson-Adley bills will not accomplish the stated goal of speeding cleanups, citing a timeline that could require almost a year to develop a cleanup plan once a party admits liability. Adley noted that most of the 270 lawsuits filed since the Legislature last visited the topic in 2006 are still pending. “This is not about time,” he said of any remaining opposition.

The new procedures would not apply to any of the pending lawsuits that had a trial date set as of May 15.

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