As gulf oil spill trial begins, Dallas lawyer takes center stage
By MARK CURRIDEN
During the past two decades, Donald Godwin has gotten his best client, Halliburton Co., out of some pretty big messes.
On Monday, he again takes center stage to defend Halliburton in what is undisputedly the largest environmental litigation ever. The long-awaited trial starts in New Orleans to determine who is responsible for the Deepwater Horizon rig explosion that killed 11 people and resulted in more than 4 million barrels of oil being spilled into the Gulf of Mexico in April 2010.
In the weeks and months following the spill, thousands of lawsuits were filed by fishermen and shrimp boat operators, hotels and restaurants, banks and real estate companies. The U.S. government sued under the Clean Water Act. Four states — Alabama, Florida, Louisiana and Mississippi — claim the oil spill costs them billions of dollars in lost tax revenue. Even teacher pension funds and a handful of Mexican state governments have sued.
“I’ve been involved in some big cases, but the Deepwater Horizon is the largest multidistrict litigation ever consolidated into one trial,” said Godwin, founding partner of Dallas-based Godwin Lewis. “This case is unprecedented, both in terms of the size of the litigation and the amount of money at stake.
“The Exxon Valdez lawsuit was huge, but it pales in comparison to the Deepwater Horizon. The trial will likely last more than a year. Damages could exceed $70 billion.
“I’ve never seen anything like it. Nobody has.”
BP, of course, has received the most attention in the case because it owned and operated the Macondo well. But other defendants, including Houston-based Transocean, which owned the Deepwater Horizon, and Halliburton, which was a contractor on the rig, also face potentially devastating damages.
Last year, BP reached two major settlement agreements. The UK oil giant agreed with the U.S. Justice Department to plead guilty to 11 felony counts involving the deaths of the workers and paid a $4.5 billion fine, which was the largest in U.S. history.
BP also reached a $7.8 billion settlement with a limited number of plaintiffs on undisputed claims, such as basic cleanup costs incurred by the states.
In January, Transocean reached its own agreement with the federal government by pleading guilty to violating the Clean Water Act and paying $1.4 billion in civil and criminal fines.
Over the weekend, The Wall Street Journal reported that the Justice Department and BP were in negotiations to settle the federal government’s portion of the lawsuit for an estimated $16 billion.
Halliburton is the one company that hasn’t settled any of the claims. Legal experts say that only enhances Godwin’s reputation as a “gunslinging risk-taker.”
“We aren’t going to New Orleans to break even and we aren’t going down there to wave the white flag,” Godwin said. “We are going to win.”
Legal observers say Godwin has settled cases when it was in the best interest of the client.
“The fact that Don isn’t interested in a settlement shows that he feels he’s holding a pretty good hand as far as the evidence and the court is concerned,” said Fish & Richardson partner Tom Melsheimer of Dallas.
U.S. District Judge Carl Barbier, who is overseeing all the litigation, has divided the trial into three stages. Phase one, which starts Monday and could last three to four months, focuses exclusively on what caused the explosion and the spill and allocating responsibility against the defendants.
The second phase will determine the amount of oil spilled into the gulf, while the third phase will determine damages.
The first two phases of the trial will be heard by Barbier, but the final stage to levy the financial judgments will be decided by a jury.
Climbing the ladder
The son of a North Carolina Pontiac salesman, Godwin worked his way through high school stocking shelves at Winn-Dixie. He quickly excelled, becoming manager of the produce section and later managing the whole store.
Godwin’s first love was the tax system. He became a CPA and then received a master’s degree in accounting. But that wasn’t enough. In 1973, he graduated from Southern Methodist University School of Law and joined a Dallas firm that slowly moved him from tax law to litigation.
In 1980, Godwin started his own law firm with George Carlton called Godwin & Carlton. In the 33 years since, the firm’s name has changed more than once, always with Godwin’s name in the lead spot.
Godwin said the invitation for him to get involved in the oil spill litigation came as he was preparing to watch the Kentucky Derby on May 1, 2010, just 11 days after the explosion. His longtime friend and Halliburton general counsel Bert Cornelison wanted him to lead the company’s legal efforts in the case.
Over the past three years, Godwin said he’s had 45 lawyers work on the case, taking more than 200 depositions and examining millions of pages of documents. He said there are a dozen paralegals and three IT support staff working on the case full time.
Lawyers familiar with Godwin say his hourly billable rate ranges from $675 to $800. They estimate he’s already put 10,000 hours into the case, and that’s before the judge has brought down the trial’s opening gavel.
“I’ve spent more time on an airplane going to take depositions in London and court hearings in New Orleans than I’ve been at home,” he said.
Godwin has scored numerous legal successes going into Monday’s trial. For example, he persuaded Barbier to rule that Halliburton’s contract with BP requires that BP pay any compensatory damages, which is payments to victims for losses, leveled against Halliburton for its work on the Deepwater Horizon.
As a result, Halliburton will have to pay only if the judge finds that the company acted with gross negligence or wanton reckless behavior, which would allow the court to levy punitive damages against it.
Legal observers say Godwin’s pretrial win puts his client in a position of strength.
“Don now knows the burden of proof against his client is higher, which gives him a tremendous strategic advantage in the courtroom,” Melsheimer said. “It’s like everyone else is trying a civil case [requiring a mere preponderance of the evidence] while Don is trying a criminal case,” which requires beyond a reasonable doubt.
Godwin also scored a major advantage early in the case when he got a key engineering expert witness for BP to admit under oath that the Deepwater Horizon blast might not have occurred if officials from BP and Transocean hadn’t misinterpreted key well-integrity tests.
While Godwin declines to discuss specific evidence about the case on the eve of trial, he said he is confident his client will not be held responsible for the tragedy.
“We are going to tell the story about why Halliburton should not be held liable,” Godwin said. “We think our case is going very well.”