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Legal news from Wednesday, January 30, 2013 |
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Former Michigan Supreme Court justice pleads guilty to fraud
Matthew Pomy on January 30, 2013 1:29 PM ET

[JURIST] Retired Michigan Supreme Court justice Diane Hathaway pleaded guilty on Tuesday to felony bank fraud as part of a plea agreement [text, PDF]. The charges arose [Detroit Free Press report] from Hathaway deeding her home in Florida to a relative while negotiating a short sale on the home, resulting in a $600,000 debt they owed to their bank being erased. The bank fraud charge against Hathaway alleges that she made false statements to the bank, fraudulently transferred property to others and failed to disclose available cash. Hathaway negotiated a plea agreement that allows for sentencing of up to 18 months in prison, three to five years of supervised release, fined up to $30,000 and pay restitution of up to $90,000. Hathaway is expected to be sentenced on May 28.
The charges were filed [JURIST report] earlier this month as a result of a Detroit news investigative report [WXYZ report]. Judicial corruption has become a growing issue internationally. In October the UN called on nations around the world to do more to combat judicial corruption [JURIST report], stating that it is a human rights issue because it can deprive people of their due process rights. It also said keeping the judiciary free from corruption is critical to "strengthen judicial credibility and independence." In 2010 the World Justice Project [advocacy website] released a report [JURIST report] ranking countries by their adherence to rule of law, which used factors such as level of corruption, rights and access to judicial remedies. The results of the report showed a trend that rule of law was lacking more in poorer countries than it was in countries with stronger economies.


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Dutch court finds Shell subsidiary liable to Nigerian farmer for oil pollution
Cynthia Miley on January 30, 2013 12:28 PM ET

[JURIST] The Dutch District Court of The Hague [official website] ruled Wednesday that a subsidiary of Shell [corporate website] could be held liable to one farmer for damages resulting from polluting the Niger Delta region in southern Nigeria. However, the court dismissed four other claims [Reuters report] brought by farmers and fishermen, along with Friends of the Earth Netherlands [advocacy website, in Dutch], against Shell seeking damages for lost income from pollution by oil pipelines and oil spills spanning back to 2004. Shell said the case would not set precedent because the parent company was not held liable, but the ruling could make it possible for other Nigerians to file lawsuits against Shell in the Netherlands. While the court accepted Shell's argument that sabotage caused the spills, it found that Shell should have prevented the sabotage at one of the facilities. Shell has said it would negotiate the amount of damages, but that appeals might postpone the negotiations. Both sides have three months to file an appeal.
In October the four Nigerian residents and an advocacy group told the Dutch court that Shell should be held liable [JURIST report] for damage from oil pollution in the Niger Delta. The suit was the first time a Dutch company has been sued for the alleged misconduct of its foreign subsidiary. Similar pollution lawsuits against Shell are pending in the US and the UK. The US Supreme Court [official website] heard oral arguments [JURIST report] in Kiobel v. Royal Dutch Petroleum Co. [SCOTUSblog backgrounder; JURIST news archive] in October. The court heard new arguments on whether three oil companies, including Shell, are immune from US lawsuits under the Alien Tort Statute of 1789 (ATS) [text] for alleged torture and international law violations that took place overseas. The court initially heard arguments last February and then directed the parties to file briefs on a new question [JURIST reports] for this term, which asked if the ATS can ever be used against against non-state citizens for atrocities committed in that state, and under what circumstances. In the UK, 35 Nigerian villages brought a suit against Shell in a London court in March, alleging Shell's slow response in cleaning up two oil spills [JURIST report] in a Nigerian river ruined their livelihoods.


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Federal judge accepts BP guilty plea, approves $4 billion oil spill settlement
Maureen Cosgrove on January 30, 2013 9:11 AM ET

[JURIST] A judge for the US District Court for the Eastern District of Louisiana [official website] on Tuesday accepted a plea agreement [DOJ press release] between British Petroleum (BP) [corporate website] and the US Department of Justice (DOJ) [official website] for the company's role in the 2010 Deepwater Horizon oil spill [BBC backgrounder]. US Attorney General Eric Holder [official website] announced that BP pleaded guilty to 14 criminal counts, including felony manslaughter arising out of the deaths of 11 crewmen, as well as obstructing Congress and violating the Clean Water and Migratory Bird Treaty Acts. BP was also sentenced to pay $4 billion in criminal fines and penalties, with more than $2 billion of the settlement money going directly to the Gulf region. Holder praised the plea agreement and emphasized the significance of the result:Today's guilty plea and sentencing represent a significant step forward in the Justice Department's ongoing efforts to seek justice on behalf of those affected by one of the worst environmental disasters in American history. I'm pleased to note that more than half of this landmark resolution - which totals $4 billion in penalties and fines, and represents the single largest criminal resolution ever - will help to provide direct support to Gulf Coast residents as communities throughout the region continue to recover and rebuild. BP has also been placed on probation for five years and was ordered to take prophylactic measures to prevent future incidents, including the retention of a process safety and risk management monitor, an independent auditor and an ethics monitor to oversee safety and improve the company's code of conduct.
Tuesday's ruling was the most recent development in a long series of legal battles that have arisen from the Deepwater Horizon Crisis. Earlier this month, Transocean Deepwater Inc. [corporate website] pleaded guilty [JURIST report] to "negligently discharging oil into the Gulf of Mexico," in violation of the Clean Water Act (CWA) [EPA summary] and will pay $1 billion in civil penalties and $400 million in criminal penalties for its role in the Deepwater Horizon spill. Last month a federal judge approved [JURIST report] a final class settlement between BP and those who experienced economic and property loss stemming from the spill. In November BP executives pleaded not guilty [JURIST report] to criminal charges stemming from the oil spill. Earlier that month BP agreed to pay [JURIST report] $4.5 billion in penalties for felony misconduct for its role in the spill. A federal judge ordered [JURIST report] BP to share partial liability with Transocean in oil spill claims in January 2012.


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