A Huge Corporation Just Got Away With Murder — And It Sets a Scary Precedent

A huge injustice: Victims of a massive corporate crime in Texas had to wait seven long years to hear how much restitution they'd be paid. When the verdict was announced in late April, it was not what they expected: $0.

Venezuelan-owned CITGO operated an oil refinery in the lower-income neighborhood of Hillcrest, in Corpus Christi. The refinery was emitting noxious fumes — including the carcinogen benzene — during a 10-year period with no regulations whatsoever. Benzene can cause cancer, damage fetuses and thin blood. In 2007, a jury deemed the corporation guilty for violating the Clean Air Act — but in a landmark decision, they weren't just guilty civilly, but also criminally responsible as well. The ruling was the first of its kind for a major oil company.

It took seven years for a sentence to be handed down. But on April 30, a federal judge ruled that CITGO Petroleum Corp. would not owe restitution to victims even though they had been exposed to toxic chemicals. U.S. District Judge John D. Rainey wrote in his statement that determining the actual amount owed to the Corpus Christi residents would "unduly delay the sentencing process" and therefore, "outweighs the need to provide restitution to any victims."

In plain English, even though CITGO was convicted of a crime, it would take an insurmountable amount of time to actually deduce a specific quantity, and so Rainey nixed the idea of recompense.

Essentially, a wealthy corporation has undermined the U.S. legal system once again. The Hillcrest neighborhood was being represented by the Department of Justice, which requested CITGO pay $55 million to cover annual disease screenings, future medical expenses and, in some cases, cover the cost of relocation.

Setting legal precedents: Until now, the judicial system had ruled in favor of the local neighborhood.

In addition to the benchmark decision to find CITGO criminally guilty, the case was also the first to identify pollution victims as victims of a crime under the Crime Victims' Rights Act. This was only after the Fifth Circuit Court of Appeal ordered Rainey to reconsider his initial denial of the request of that status to 20 victims. Eventually, Rainey granted the status to more than 800 residents of the community and also permitted the victims to present oral testimony in court.

The case was the first to identify pollution victims as victims of a crime under the Crime Victims' Rights Act. This was only after the Fifth Circuit Court of Appeal ordered Rainey to reconsider his initial denial of the request of that status to 20 victims. Eventually, Rainey granted the status to more than 800 residents of the community and also permitted the victims to present oral testimony in court.

Big fish eat little fish. CITGO is a large corporation with huge financial assets at their disposal. The Justice Department calculates that during the time CITGO was illegally emitting toxins in Corpus Christi, the corporation made $1 billion in profits. In February, after seven years, Rainey finally fined CITGO a paltry $2 million for its crime, screwing the locals out of the many millions the Justice Department and EPA were dutifully pursuing on their behalf.

Paul Cassell, a law professor at the University of Utah S.J. Quinney College of Law and a former federal judge, is appealing the case pro bono to represent 20 of the victims. Cassell plans to argue the case in front of the Fifth Circuit Court of Appeals. The victims have suffered at the hands of CITGO refinery and with little funds to pursue their due process right, Cassell hopes to change the ruling in his appeal.

"In this situation when you have a wealthy company and many indigent victims, we think in some ways the order was backwards, focusing too much on the defendant's interests and not giving enough attention to the victims' interests," Cassell told the Texas Observer.

There are ramifications. Raineys ruling emphasizes that it is a burdensome task for the court to quantify the loss incurred by CITGO's victims. Comparatively, water contamination cases are much easier to prove in court because the direct cause and effect of water contamination can be measured. It is much more difficult to directly link toxic air emissions to victims as the sole cause of health problems. A host of other factors could likely be the root of certain health ailments.

Yet, Rainey does outline the guidelines that must be met in order for a corporation to pay for harming victims. Grossly oversimplifying, Rainey states that in order to be held accountable by a court of law, the attorney for the claimant must prove that:

1. Victims were exposed to harmful emissions

2. Victims suffered an actual loss as a direct result of exposure

3. Problems such as cancer or the loss of a job were not incurred by alternative sources

4. They can correctly attach an accurate number to the loss of the victim

Rainey's parameters are determining the standard for future criminal environmental cases. If and only if all these four criteria are met and approved by a court decision, would a corporation then be held criminally responsible and the victims would get compensated. But, the bar is being set very high.

This case is important because it means that contamination victims, whether by air, water or soil, can be recognized as the victims of a crime. Future fracking and pollution cases will likely be referencing this as a case-and-point in courtrooms, hoping to receive more favorable outcomes.

The issue is that they will need to meet every aspect of Rainey's criteria in order to do so. That is quite a tall order, and in the meantime it leaves victims without any restitution. Too often, the victims are the ones who desperately need the money owed — not the criminals.