Udall, Bennet seek investigation of Transocean’s $1B shareholder payout
Monday, May 24, 2010 at 2:13 pm
Colorado U.S. Sens Mark Udall and Michael Bennet joined 16 other Senate Democrats in demanding the Justice Department investigate $1 billion in shareholder dividends paid out this week by Transocean Ltd., the Swiss company operating the Deepwater Horizon oil rig when it blew up last month fouling the Gulf of Mexico for the last 33 days.
“It’s heartwarming to see that Transocean, the same company that rushed to limit its liability in the Deepwater Horizon rig explosion, seemed not to hesitate at all when it came to the decision to distribute its profits,” one maritime expert wrote of the plan.
Today, the 18 Senate Democrats took that sentiment a long step further in asking Attorney General Eric Holder to look into whether those payouts amount to a dodge from liability. Are these payments appropriate, they ask, “at a time when [the company] may be responsible for financial damages related to the massive oil spill?”
“Transocean’s stockholders,” the lawmakers wrote in the letter to Holder, ”should not take huge profits from polluting our country’s Gulf Coast.”
We are concerned that such action to quickly move money out of corporate coffers to individual investors may make it more difficult to pursue liability claims against the company. Families of those who died in the disaster, the fishing industry that has been devastated by the oil spill and the governments that have worked full-time to clean up this spill deserve better. Transocean has also reported that it expects to make a $270 million profit on its insurance policy for the Deepwater Horizon, since the rig was insured for more than it was worth.
The letter, spearheaded by Sen. Ron Wyden (D-Ore.), also drew the support of Democratic Sens. Pat Leahy (Vt.), Charles Schumer (N.Y.), Tom Harkin (Iowa), Robert Menendez (N.J.), Mark Begich (Alaska), Byron Dorgan (N.D.), Patty Murray (Wash.), Jeanne Shaheen (N.H.), Bill Nelson (Fla.), Mark Pryor (Ark.), Jeff Merkley (Ore.), Max Baucus (Mont.), Amy Klobuchar (Minn.), Blanche Lincoln (Ark.) and Robert Casey (Pa.).
Dodging liability might just be a business decision for Transocean. The company was based in Houston for years but officials moved the headquarters to Switzerland “to avoid paying higher corporate taxes.“