Appeals Court Rejects Takings Claim
TALLAHASSEE, Florida, December 3, 2003 (ENS) - Environmentalists
hailed today's ruling by a Florida District Court of
Appeals to reject a
corporate claim that denial of an offshore drilling
permit entitled the
company to a takings claim.
The ruling is the culmination of more than seven years
of litigation by
environmental groups aimed at preventing the Coastal
from drilling off the coast of Florida.
The case began when the Florida Department of Environmental
granted Coastal Petroleum an oil drilling permit in
Earthjustice initiated a lawsuit on behalf of the Florida
Federation, the Sierra Club and the Florida Audubon
Society to have the
permit invalidated on the ground that it violated oil
and gas permitting
The plaintiffs repeatedly argued that Coastal Petroleum
was seeking a
permit solely for the purpose setting up a "takings
claim." Such a claim
would allow the company to claim billions of dollars
compensation from the state if the permit were denied.
The environmental lawyers said that although it claims
to be an oil
company, Coastal Petroleum has never produced a drop
of oil from its
offshore oil leases and has never made a profit in its
50 year existence.
The oil drilling permit was denied on environmental
grounds, as the
court agreed with plaintiffs that on balance the slim
finding any recoverable oil were outweighed by the environmental
Coastal then filed a lawsuit claiming that the lawful
denial of the
permit entitled it to hundreds of millions of dollars
for the "taking"
of its offshore lease.
Under the takings law, companies or individuals may
claim that they
deserve financial compensation if the government takes
useless private property.
Today's decision upheld the ruling from the bench that
threw out this
claim on the grounds that Coastal Petroleum was not
guaranteed a permit
for drilling under their oil and gas lease.
"The trial court got it absolutely right,"
said Earthjustice attorney David Guest. "Coastal
Petroleum is not really an oil company and there
never really was an oil and gas prospect. All they wanted
was to get
their permit was denied so they could get hundreds of
dollars from the state. It did not work."