Looking out from his waterfront home in Fairhope, Ala., Frederick "Rick" T. Kuykendall III can see miles of boom protecting a coastline endangered by millions of gallons of oil pouring out of a well in the Gulf of Mexico.
In all his years of environmental law, Kuykendall couldn't have expected that what might be his biggest case would happen in the region where he grew up.
Kuykendall, 55, is a lawyer affiliated with the Murphy Firm in Baltimore, headed by Billy Murphy, that specializes in complex commercial litigation. Kuykendall has litigated several major environmental cases nationwide in a career spanning more than two decades. And now he represents people who have been affected by the oil leak in the Gulf of Mexico.
The leak in the Gulf has been gushing since April 20, when the Deepwater Horizon oil rig exploded and 11 workers were killed. The deepwater wellhead, which is about a mile below the water's surface, is estimated to be spewing 35,000 to 60,000 barrels per day.
BP, which was leasing the oil rig, has created a $20 billion compensation fund for people economically affected by the oil leak, including those who work in the fishing and tourism industries. BP has already been reimbursing those whose incomes have been hurt by the leak, though many have criticized the company for moving too slowly to pay claims.
Kuykendall believes the damage to coastlines and livelihoods will be extensive and potentially long-lasting. In a recent interview, he discussed his own efforts in representing clients on the Gulf Coast, what victims of the disaster can expect in the future, and how the damage could impact the seafood business in Baltimore.
Question: How long have you been in the Gulf?
Answer: I arrived on April 21, the day after the incident. I'm from here, so I have a lot of friends who knew immediately this was going to impact them. They called me to come down and give them advice and evaluate what was going on.
Q: You've worked on other environmental liability cases in the past. How does the BP oil leak compare in your mind?
A: I've had water pollution cases against DuPont, Coneco Phillips, Constellation Energy and handled some of the largest nationwide cases in the history of the United States, and I think this case is larger than those cases combined. I think it's the single greatest environmental disaster in the history of the United States. It may be the last case I work on in my life — it has that kind of range. I can give you a bunch of sound bites, but that's really the truth. I've prepared all my professional career for this case. I just never expected it would happen in my backyard.
Q: You've seen some of the pollution firsthand on the beaches. What are your observations?
A: To me, what's significant is the untold story of what you don't see: the effect of the dispersants [chemicals that disperse the oil] and the diluted oil. The invisible toxicity is everywhere, and the testing shows it. First off, we're dealing with the largest spill in U.S. history. It dwarfs the Exxon Valdez today by 10 times. I've seen dolphins dying. I've seen sugar-white beaches that have been reduced to tar-ridden, oil-covered spaces. Pensacola Beach was completely covered. … You never have a chance to start restoration because the oil keeps tearing up the area. People don't understand this: It's a crisis every day, and it's going to be like that for a long time after that until the oil dissipates.
Q: Who are some of the bigger clients you have that have been affected by the spill, and how have they been hurt?
A: I filed the first case on behalf of the commercial fishermen of Louisiana. I was part of the team that got the first legal victories in the case. ... I also represent local businesses, like [musician] Jimmy Buffet's sister's restaurant and countless homeowners and small businesses. I'm filing all my cases separately.
Q: What kind of businesses do you see most affected by the leak?
A: The people most affected are the fishermen and the oystermen and people who rely on the Gulf for their livelihood, which includes restaurants and people who work in the seafood and tourism industry, realty companies and homeowners. State and local governments are overwhelmed. They were already having budget deficits, and this couldn't come at a worse time. They were still recovering from Hurricane Katrina. People were just getting back to normal life; then we had the recession, and then this happened.
Q: With so many different kinds of people affected by this, will there ultimately be one legal strategy that emerges, such as a large class action lawsuit?
A: There are over 200 pending individual and class action cases. They will all be sent to a panel on multidistrict litigation in the federal court system. That hearing is currently scheduled for July 29 in Boise, Idaho. At that hearing, the court will determine if all the cases should be consolidated before one court and, if so, where is that going to be and what judge will handle it. I think it should be consolidated into one action, and I'm urging it going to the Eastern District in Louisiana. … But we won't know that until a couple weeks after the hearing in Boise.
In my view, lawyers and victims of the spill will have to take a hard look at whether the [$20 billion BP] fund presents a better alternative to litigation. Most likely, the BP portion of this case will be resolved in large measure through that fund, if it's fair. You won't have to prove BP was at fault; you'll just have to prove how [the leak] affected you.
Q: How will the $20 billion escrow fund work for people and businesses who file claims with BP? Will people who receive payouts from the fund have to agree to not pursue litigation?
A: That's one of the questions that will have to be answered, but the answer is most likely "Yes." It's more likely than not that if you go into the fund, you'll be giving up your rights to go into the court system. But only against BP. [There are other companies involved and potentially liable.]
Q: Do you think that $20 billion will be enough to cover the effects of the leak on the Gulf Coast?
A: No. No. No. The fund is designed to compensate the victims of the spill. It's not the cleanup costs. BP is committed and is on the hook for the cost of the entire cleanup, and that's separate and distinct from the $20 billion fund. The extent of the damage is overwhelming. Who knows what the ultimate effect on public health is going to be? … You might have people exposed to dispersants and oil in the ambient air, and hurricanes could blow polluted air all over the Gulf Coast. We don't know the long-term impact on public health.
Q: Could businesses in other parts of the country, such as Baltimore, file claims if they can prove they've been affected by the spill?
A: There may be people in Baltimore who own Gulf-front property. Those people are definitely impacted. Then you have restaurants and seafood distributors who may have a legal claim that could be processed under the current BP system, or the [$20 billion compensation] fund or the court.
Text BUSINESS to 70701 to get Baltimore Sun Business text alerts MORE INTERVIEW SUBJECTS
See more business leaders interviewed by The Baltimore Sun