Court to hear Exxon Valdez case

(AP Photo/John Gaps III, File)

Should Exxon Mobil Corp. have to pay $2.5 billion in punitive damages for the massive Exxon Valdez oil spill? 

The Supreme Court will decide.

Nearly 20 years after the Exxon Valdez tanker spilled 11 million gallons of oil into Alaska's Prince William Sound and affected 1,200 miles of coastline, the nation's highest court will finally decide if the penalty is fair. In 1994, a federal court cut the $5 billion award in half.

AP Writer Mark Sherman reports the justices will consider if Exxon has to pay any punitive damages at all. The company is arguing that $2.5 billion is excessive under laws governing shipping. Exxon said it should not have to pay any further fines because it already has paid $3.4 billion in clean-up costs and other penalties resulting from the oil spill in 1989.

Lawyers for the plaintiffs said the damages awarded is "barely more than three weeks of Exxon's net profits."

-- Howie Rumberg