U.S. Asks Court to Reject Transocean Liability Cap

The U.S. government has asked a federal judge to reject Transocean Ltd.’s application for Limitation of Liability in which it sought to limit its liability to $27 million for claims tied to the Deepwater Horizon oil rig explosion and subsequent oil spill.

The filing comes the same day the Justice Department announced an investigation of whether any criminal or civil laws were violated in the BP Plc oil disaster in the Gulf of Mexico, the biggest U.S. spill on record. The government is reviewing whether there were violations of the Clean Water Act and the Oil Pollution Act of 1990.

The U.S. filed the motion in Houston federal court.  The spill began after an April 20 fire aboard the Deepwater Horizon rig, which London-based BP leased from Switzerland-based Transocean to drill its Macondo well in the Gulf.

The Limitation of Liability Act of 1851 is pre-empted by the Oil Pollution Act of 1990 and the claims of state governments are also not subject to the limitation act,

The case is In Re the Complaint and Petition of Triton Asset Leasing GmbH, Transocean Holdings LLC, 10-01721, U.S. District Court for the Southern District of Texas (Houston).