United States: Does Responder Immunity Only Benefit Responders? What No One Has Explained To You About Insurance

Last Updated: June 25 2014
Article by Jonathan K. Waldron

There is a bit of weariness (and disappointment) in our industry with regard to the initiative to enact an enhanced responder immunity regime. Indeed, it has been over four years since the fire and incurred loss of life related to the Deepwater Horizon incident. But this issue remains important because all of the spill response organizations, the spill management team, and the dispersant spraying companies were sued after the incident, and remain in litigation even though BP was able to settle its claims with the plaintiffs. In addition to the following summary of the status, for the first time I will explain why enactment of the proposed legislation will not only benefit responders, but also the marine industry in general, and responsible parties in particular.

As way of review, following the lessons learned from the Deepwater Horizon incident, specifically the extensive lawsuits filed against all segments of the response industry involved in the response, a Responder Immunity Coalition (the "Coalition") was formed. The Coalition is comprised of all response interests, including the salvage industry, oil clean-up industry, spill management industry, the offshore vessel support industry, and the well containment industry, to work with Congress to enact enhancements to the current responder immunity provisions enacted by the Oil Pollution Act of 1990 ("OPA 90").

The two main concerns following the incident were that (1) the plaintiffs sued the responders under general maritime law, alleging personal injury caused by the exposure to the spilled oil and the dispersants that were approved for use on a daily basis by the Federal On-Scene Coordinator ("FOSC") pursuant to the National Contingency Plan ("NCP"); and (2) the plaintiffs made bare allegations of gross negligence and willful misconduct related to the response actions without having to detail any underlying facts to support such allegations.

To address these concerns, the proposed legislation would:

  • extend the immunity under the law to a full range of response activities by explicitly defining the response activities covered under the immunity;
  • provide immunity to a responder with regard to exposure claims related to the oil and dispersants, but otherwise maintain the current regime of responder employer liability for slips, trips, and fall type injuries (seaman Jones Act remedies) that commonly occur in marine operations; and
  • establish a presumption that response actions do not constitute gross negligence and require claimants to pay attorneys' fees and court costs for meritless claims to disincentivize frivolous lawsuits.

As the Coalition heard from various factions of the industry, it became clear that there were deficiencies in the initial proposal that needed to be addressed. As a result, the current version reflects necessary changes to address concerns that the immunity was not unnecessarily broad and would not have unintended consequences.

Thus, the current proposal includes new language to make clear that no new liability is transferred to a Responsible Party ("RP"). Under the law today, a RP is strictly liable for damages and removal costs and would be liable for an exposure claim as discussed above if found negligent under general maritime law. This proposal would not change that liability. And in all cases, an injured party will always have a remedy that will be backed up by the Oil Spill Liability Trust Fund even if a RP is unable or unwilling to pay compensation.

In addition, concerns have been raised that "opening up OPA 90 to amendments" would result in numerous OPA 90 amendments that could be attached to the Coalition's proposal, which potentially would have negative effects on the marine industry, such as increased limits to liability that were proposed shortly after the Deepwater Horizon incident. However, it has been over four years since the incident, and the constant barrage of OPA 90 amendments related to the proposed legislation has died down completely. There is simply no longer a valid reason not to move forward with this proposal. OPA 90 has been amended numerous times since the initial enactment. Moreover, the industry in general, and a RP in particular, will substantially benefit if this legislation is enacted as currently drafted. In short, this is because it is the RP and others requiring the services of responders who pay the cost of any frivolous litigation against a responder. Indeed, if a robust responder immunity protection is not available through statute, then the RP will still have to bear this liability and cost.

Moreover, if a responder is afraid to aggressively respond to a spill incident, then the oil will spread quicker and damages will continue to mount, resulting in significant increased costs to a RP and greater damages to our environment.

Specifically, with regard to insurance, under the routine response contract between a RP and responders, the RP will have agreed to provide enhanced contractual indemnity provisions to their contracted responders. And, as a result of this indemnification, the RP will have to pay in the future the increased time and material services costs as their contracted responders are forced to pay for increased insurance premiums to insure against these risks because the current regime of responder immunity is not providing the protection from lawsuits that was envisioned.

In addition, once a responder is sued, the RP will not only have to pay for its own defense costs as the RP, but it will also have to pay the defense costs of the responder as a result of its indemnification provision. Thus, the RP is paying double defense costs if adequate responder immunity is not available, and will ultimately pay for the responder's increased insurance rates through higher costs for response services that will be passed along to the RP. This is exactly what happened as a result of the Deepwater Horizon incident due to the claims against responders that are still pending in court. Accordingly, the Coalition proposal benefits potential RPs by avoiding unnecessary additional defense costs and increased rates for services.

The only reason this legislation was not enacted earlier was because there were objections raised by a key industry organization. These objections carried great weight despite the fact that key congressional offices supported enactment of this proposal. As a result of the Coalition effort to better educate the industry, we have recently seen a turn within the industry to support this effort as more stakeholders begin to fully understand how this enhanced responder immunity will not only help the response industry, but also provide tangible benefits to a RP and our industry as a whole in a future incident. Added to that, a faster response will better protect our environment and best mitigate damages.

However, this turnaround has to happen quickly so that objections from these interests are at least changed to neutral if not in support of the proposal. This is because the House passed its version of the Coast Guard Authorization bill earlier this year and action is expected in the Senate in the next few weeks to initially introduce its version of the Coast Guard Authorization bill. Following introduction, the bill will next proceed to a full Senate Commerce Committee mark-up (the committee with jurisdiction over this matter). Following that action, it will next be brought to the full Senate floor for consideration. This will likely be in the form of an amendment folded into a Managers' Substitute package or as an amendment offered by a specific member (with co-sponsors and other member support) during floor debate on the bill.

If the proposal is not added during Senate action, it is possible to add it during formal or informal conference negations between the House and Senate (to work out any differences between the two bills), provided that there is a provision, or provisions, in either the House or Senate final bills, that are close enough in subject matter to make the proposal "germane," and therefore within the scope of the two bills. As to timing, it is likely that the bill will not be wrapped up until much later in the year (in the November-December timeframe), which should provide ample time to work the issue based on these new developments.

In conclusion, it is clear that if the Coalition's proposal is enacted, it will provide noteworthy benefits in terms of reducing the RP's defense costs because plaintiffs will be discouraged from suing responders unnecessarily (i.e., the RP will only have to pay defense costs for lawsuits against the RP and not have to reimburse responders through indemnification provisions in their response contracts). As a result of this outcome, there will be no increase in the amount of insurance premiums, and thus no additional costs passed on to a RP due to any increased premiums. And an effective response immunity regime will provide responders with the necessary confidence to respond expeditiously without the fear of unfounded lawsuits. This has the overall public benefit of minimizing the damages to the greatest extent possible, which will have the added benefit to lower the RP's liability for additional damages that would result from a slow response effort.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions