Supreme Court Slashes Exxon Damages Justices rule that the punitive damages were excessive under maritime law. Instead of $2.5 billion, Exxon now has to pay just $500 million. "It was like getting the rug pulled out from under you," says plaintiff Osa Schultz.

Supreme Court Slashes Exxon Damages

Supreme Court Slashes Exxon Damages

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The Supreme Court Wednesday overturned $2.9 billion in punitive damages against Exxon Mobil Corp. for the 1989 Exxon Valdez oil spill off the coast of Alaska.

The court ruled the punitive damages were excessive under federal maritime law, saying they should not exceed the amount of the $507 million in compensatory damages the company had already been ordered to pay.

Plaintiff Osa Schultz discusses what the ruling means to fisherman with Madeleine Brand.

"It was like getting the rug pulled out from under you, just when you had the room set up," she says.

Supreme Court Cuts Damages in Exxon Valdez Spill

Frank Langfitt discusses Wednesday's ruling on 'All Things Considered'

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Ari Shapiro and Renee Montagne discuss Wednesday's rulings on 'Morning Edition'

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Workers clean oil-covered rocks in Alaska near the site of the Exxon Valdez oil spill in 1989. Natalie Fobes/Corbis hide caption

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Natalie Fobes/Corbis

Workers clean oil-covered rocks in Alaska near the site of the Exxon Valdez oil spill in 1989.

Natalie Fobes/Corbis

After nearly 20 years, Exxon Mobil Corp. will have to pay punitive damages for the massive Valdez oil spill in Alaska. But in its ruling Wednesday, the Supreme Court slashed those damages to about $500 million.

The plaintiffs — fishermen, landowners and native Alaskans — had hoped for much more.

A lower court had ordered the company to pay $2.5 billion in punitive damages, but in its opinion, the Supreme Court found that amount excessive.

The high court said that under federal maritime law, punitive damages shouldn't be any larger than the compensatory damages the company had already been ordered to pay. In other words, the company shouldn't have to pay more in punishment than the actual damage it caused.

The Exxon Valdez ran aground in Alaska's Prince William Sound in March 1989, spilling 11 million gallons of oil — the largest spill on record in North America.

Exxon had asked the high court to reject the punitive damages judgment, saying it already has spent $3.4 billion in response to the accident, which fouled 1,200 miles of Alaska coastline.

Material from the Associated Press was used in this report.