The U.S. Supreme Court on Wednesday cut the $2.5 billion punitive damages award in the 1989 Exxon Valdez disaster to $500 million. The court ruled that victims of the worst oil spill in U.S. history may collect punitive damages from Exxon Mobil Corp., but not as much as a federal appeals court determined. Justice David Souter wrote for the court that punitive damages may not exceed what the company already paid to compensate victims for economic losses, about $500 million compensation.
Exxon asked the high court to reject the punitive damages judgment, saying it already has spent $3.4 billion in response to the accident that fouled 1,200 miles of Alaska coastline. A jury decided Exxon should pay $5 billion in punitive damages. A federal appeals court cut that verdict in half. The court divided 5-3, with Justice Samuel Alito taking no part in the case because he owns Exxon stock.