Jenner & Block

Jenner & Block Earns $104.69 Million Appellate Victory for City of New York

A Jenner & Block team, led by Partner Paul M. Smith, secured a significant win for the City of New York today, as the U.S. Court of Appeals for the Second Circuit upheld a $104.69 million judgment against ExxonMobil for contaminating City-owned wells by the release of a gasoline additive known as chemical methyl tertiary butyl ether (MTBE).

The award of compensatory damages, first decided by a jury after an 11-week trial in 2009, is slated to be used to clean up the contaminated wells. ExxonMobil used MTBE as a gasoline additive from the mid-1980s through the mid-2000s.  The state of New York had banned the substance as of 2004 after linking it to groundwater contamination.  The City first sued ExxonMobil and other oil companies in 2003, arguing that they knew the effect that the gasoline additive would have on groundwater.

On appeal, ExxonMobil argued that the federal Clean Air Act, which required the use of gasoline additive like MTBE, superseded the City’s laws, as well as that the City’s precise injury could not be determined.  Smith argued the appellate case for the City.  The Second Circuit upheld the entirety of the district court decision, which held ExxonMobil liable for failure to warn others about the dangerous nature of its product, as well as trespass, public nuisance, and negligence claims brought by the City.

The 68 groundwater drinking wells in question, in southeast Queens, serve as a back-up supply for New York.

In a City news release, Michael A. Cardozo, corporation counsel for New York City, thanked the Jenner & Block team for its work.  The firm team was also represented by Partners Joshua M. Segal and Marc A. Goldman and Associate Matthew S. McKenzie.  Former Jenner & Block partner Elaine J. Goldenberg, now an assistant to the solicitor general, also played a major role in this matter. 

In the City’s news release, Smith said: “We are pleased that we were able to assist the City in upholding its landmark verdict against a company that committed a series of tortious acts in manufacturing and distributing gasoline containing an ingredient that it knew could cause widespread pollution of groundwater.”