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PRI's Environmental News Magazine

Judging the Judge

Air Date: Week of June 25, 2010

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The Deepwater Horizon oil rig was owned by Transocean; Judge Martin Feldman owned Transocean stock. (U.S. Coast Guard)

New Orleans Judge Martin FeldmanÂ’s ruling to block the Obama administrationÂ’s six month moratorium on new deep water oil drilling has not only angered the president and many environmental groups, but also has raised some eyebrows for another reason. ThatÂ’s because Judge Feldman has owned stock in offshore energy companies. As Living on EarthÂ’s Mitra Taj reports, many are asking why he didnÂ’t recuse himself from the case.

Transcript

YOUNG: Well, another of the administrationÂ’s responses to the Gulf disaster suffered a major setback when a federal judge in New Orleans ruled against the presidentÂ’s 6-month moratorium on new deepwater drilling.

Judge Martin Feldman called that moratorium capricious and said it ignored the importance of energy jobs to the Gulf Coast economy. The administration is revising its moratorium. But the court ruling brought attention for another reason: Judge Feldman owned stock in offshore energy companies. ThatÂ’s raised questions about the influence of oil money in the judicial branch. Living on EarthÂ’s Mitra Taj reports.

TAJ: This is whatÂ’s known publicly about Judge Martin FeldmanÂ’s offshore investments: Between 2003 and 2008 he owned stock in more than a dozen companies that help drill or finance deepwater energy projects. In 2008, he owned up to $15,000 in Transocean, the company that operated BPÂ’s doomed oilrig. WhatÂ’s not known is this: does Judge Feldman still own stock in offshore oil and gas companies? Catherine Wannamaker is the lead attorney for the Southern Environmental Law Center, one of the green groups that intervened legally to keep the 6-month moratorium in place.


Oiled Brown Pelicans in Grand Isle, Louisiana wait to be cleaned. As the oil continues to gush in the Gulf, lawsuits are being filed against BP and Halliburton. (IBRRC)

WANNAMAKER: We certainly would want to know what stock he owns. You know, if he does own stock in companies that are affected by the moratorium, thatÂ’s certainly something we would want to look at.

TAJ: Knowing could change everything. Depending on the amount and type of stock, it could add up to a violation of the code of conduct for U.S. judges. But Judge FeldmanÂ’s public financial disclosure forms only cover up to 2008.

HeÂ’s declined to comment on his current investments, and turned down requests to share his financial filings from last year. But in an unrelated case, Feldman disclosed owning shares of Ocean Energy Inc. In 2008, his stock in the offshore engineering company was worth between 15 and 50 thousand dollars. This admission came just a month ago, leading some to wonder whether he has financial stake in a company affected by his new ruling. Vermont Law School professor Patrick Parenteau says, even if Feldman no longer holds stock in offshore oil companies, the past is still relevant.

PARENTEAU: That certainly is grounds for recusal. The way that this works is that judges are supposed to disclose that kind of financial interest, even one that they formerly had but no longer have, because he could have of course have benefited from it, even though no longer owns stock from it.

TAJ: A recent Associated Press investigation suggests that judges like Feldman could be the rule, and not the exception, in the Gulf region. Thirty-seven out of 64 judges were found to have ties to the oil and gas industry. Some have asked the courts not to assign them cases related to the oil spillÂ… others, like District Judge Carl Barbier, decided to dump stock so he could preside over Deepwater Horizon cases.

Like Judge Feldman, Judge Barbier works at the U.S. Court of the Eastern District of Louisiana, and was recently assigned more than 30 lawsuits filed against BP and Transocean. Charles Geyh, a law professor at Indiana University, says Judge FeldmanÂ’s holdings merit a closer look.


Judge Feldman, a Reagan appointee, wrote that one accident doesn't mean the entire deepwater drilling industry should be put on hold. (U.S. Coast Guard)

GEYH: There mere fact that you own stock in a bunch of companies within an industry doesn’t disqualify you from hearing matters affecting other companies within the industry. But I would want to know how much stock, you know, I’d want to hear more about the relationship is what the likely relationship is between the judges financial interest in the stock he holds and the outcome of his decision, because that would inform whether this is something not to be worried about or whether it’s something where you would logically say hold on a second— this isn’t right.

TAJ: Geyh says part of the problem is that judges determine their own impartiality. If lawyers point out conflicts of interest, they risk having the judge dismiss their concern, and they could make an enemy in the process.

GEYH: I mean, the idea of having the judge grade his own paper in that way, strikes me as a fundamentally bad idea. Particularly in a politically and incendiary environment like this one.

WHITEHOUSE: I think the reach of the industry is profound.

TAJ: Senator Sheldon Whitehouse is a Democrat from Rhode Island, and a member of the Senate Judiciary Committee. He says he wants clarity on Judge FeldmanÂ’s holdings, and is striving to limit the influence of Oil and Gas.

WHITEHOUSE: At this point the balance is very kiltered against ordinary Americans. And they do it through lobbying pressure, they do it through threats of litigation, they do it through the revolving door. And you stack all that together and where does the public stand a chance?

TAJ: The pressing question now for those demanding oil spill justice is: which judge will hear some 200 lawsuits filed against BP and Transocean? BP is pushing for U.S. District Judge Lynn Hughes of Houston, who owns stock in oil companies and has taken travel money from the American Association of Petroleum Geologists. A federal panel will pick the courtroom for the lawsuits July 29th. In the meantime, Professor Gehy says the courts should remember, theyÂ’re in the spotlight.

GEHY: This really is the case of the century, for the oil industry. For the judiciary, this is their moment, where they can really step up and really convey the impression that impartial justice is what theyÂ’re all about, and I think itÂ’s very important that theyÂ’re mindful of that as they carry on with this incredibly difficult series of cases.

TAJ: For Living on Earth, IÂ’m Mitra Taj in Washington.

 

Links

Judge Martin Feldman's financial disclosure forms can be accessed on JudicialWatch.org.

Judge Martin Feldman's disclosure of owning stock in Ocean Energy Inc last month.

Click here to read Canons 2 and 3 on impartiality and impropriety in the U.S. Courts Code of Ethics.

Read the AP investigative story on oil and federal judges.

Click here to read Judge Martin Feldman's decision to overturn the six-month moratorium on offshore oil drilling.

 

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