Published on December 21st, 2009

Exxon decides not to appeal

By JOY LANDALUCE

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Exxon will pay out money it had previously set aside for punitive damages, stated a news release posted Dec. 15 on the Exxon Qualified Settlement Fund Web site.

"Rather than appeal to the United States Supreme Court, as per the Nov. 3 post, Exxon has decided to pay to plaintiffs the $70 million (plus interest) of the punitive damages that it had withheld for costs. Exxon has now paid to the Exxon Qualified Settlement Fund all monies owed in the Exxon Valdez Oil Spill litigation pursuant to the punitive damages judgment. The Administrator and Lead Counsel will apply to the Court to distribute this money after additional punitive damages principal and interest have been distributed and after disputes pertaining to various reserves have been resolved," reads the statement.

Fisherman/financial adviser Frank Mullen said most of the "clean claims" group have already received direct deposits and snail-mail checks. "I just returned from several days in Cordova talking to fishermen about financial planning, and am encouraged that many people are taking seriously the challenge of using this "last of the big payouts" to provide for their future income," Mullen said.

Below are a few general rules of thumb and tips for "oiled fishermen," which Mullen has shared with The Cordova Times.   

1) Pay down debt, especially credit cards and any other "high interest" debts. 

2) Paying off the mortgage is a debatable issue: the mortgage interest deduction is a valuable consideration. Carefully weigh the pros and cons of this and discuss with a tax expert. 

3) Avail yourself of every opportunity to mitigate taxation. The "Exxon IRA" (allowing tax deferred contributions of up to $100,000 to individual IRA's) and income averaging tools that were made available by the efforts of "oiled fishermen" a couple of years ago are not the only considerations. Be sure that other IRA's are funded to the extent possible: SEP IRA (for self employed i.e. fishermen), Traditional IRA and spousal IRA.  Defer taxation and reduce your current year income as much as possible.

4) Your Will: If you don't have one, get one. If you do have one, pull it out, dust it off, and be sure that it still says what you want it to say. It is surprising to me in talking to people how many folks have procrastinated in this important area.

5)  Think about where your income will come from when you are 85 years old. If you plan properly now, you may be able to afford new teeth every year.

 

$70 Million

"As you may have heard, Exxon has decided to throw in the towel on their appeal to the Supreme Court of $70 million in attorney's fees. It would be nice to think that perhaps the scrooge of oil spills past has had an epiphany and the cold, cold heart has begun to soften. Ha! Probably not! More likely they looked at their last bill from their legion of attorneys and made a purely business decision. Or, they decided to send all "oiled fishermen" fuel coupons for life and a nice Christmas card because 20 years of guilt for screwing up so many lives finally got to them. If anyone gets a card from Rex Tillerson, be sure to let me know," Mullen said.

 

'Dirty' claims payout

Those people that have "dirty claims" (you know who you are) should start checking in February for your payment. "Dirty" claims are in this category because the recipient may be an estate, or due to other issues such as liens or divorce.

 

The 'final sweep'

"It is likely that there will be one final payout in 2010 that is made up of all residual funds, including the $70 million mentioned above. This will be the one where the attorneys start looking at all the various buckets with "holdback" reserves attached to ongoing litigation. I hope they look under the couch cushions might be a few million hanging around here and there," Mullen said. "Be sure to contact me if you'd like to discuss any aspect of financial planning. I'll be returning to Cordova regularly, so be sure to contact me if you'd like to plan a visit. Merry Christmas and Happy New Year!"

Joy Landaluce can be reached at editor@thecordovatimes.com, or by phone at 907-424-7181

 

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