Unthinkable and unexpected, catastrophic incidents unfortunately happen from time to time and can leave the involved companies with full-blown disasters on their hands. Investigating and litigating the facts of the incident will certainly be required, and you may be well prepared to handle the incident-specific issues. But are you prepared to defend a comprehensive assault on your risk management methods under the expansive umbrella of “process safety”? Have you considered how your overall safety culture or ability to learn from prior incidents might be portrayed by creative plaintiffs’ attorneys and the press?
Developing a positive safety culture and creating effective risk management systems are critical, and often challenging, undertakings for any company. Safe operations depend on a company’s ability to identify gaps in safety systems, to periodically reassess the systems’ effectiveness, and to minimize the likelihood of future system failures through appropriate response and training. Deploying appropriate process safety systems provides immeasurable benefits for your company, your employees and the public at large. But it is imperative to recognize that these tools carry responsibilities that, if ignored, can lead to significant legal exposure when the unexpected does occur.
Earlier this year, in the trial stemming from the 2010 Gulf of Mexico oil spill, the private plaintiffs focused much of their case on BP’s alleged failures in what they called “process safety”—the risk management framework for avoiding a disastrous accident. Before trial, U.S. District Judge Carl Barbier ruled that evidence of some of BP’s most notable prior incidents would be precluded from evidence, as you would expect. His ruling, however, did not prevent the plaintiffs from calling a renowned process safety expert to testify about BP’s alleged “tragic, egregious” failure to implement its process safety systems on the ill-fated well. The expert, the plaintiffs’ first witness at trial, concluded that this failure caused the catastrophic blowout that claimed 11 lives and started a flow of oil for nearly three months.
The Gulf oil spill case provides a clear illustration of the ability of creative plaintiffs lawyers to present evidence at trial of a company’s alleged failure to learn from previous incidents, even those completely unrelated to the incident at hand. The plaintiffs in this case argued that this inability to learn from prior mistakes supported not just findings of negligence and gross negligence, but also punitive damages.
A Trend Just Beginning
At its core, process safety is risk management and includes everything a company does to reduce the chances of a major catastrophe. The concept behind it is not new, but it is new to large-scale litigation. A recent search of Lexis and Westlaw revealed only 77 cases that include the term “process safety” at all. Of those 77, a company’s process safety system was directly at issue in only a few. The Gulf oil spill plaintiffs’ focus on alleged process safety failures as a way to establish punitive damages suggests that this trend is just beginning.
The allure of process safety is that it offers plaintiffs a framework for connecting a defendant’s past conduct with a present-day incident. This attack offers a route for possibly avoiding evidentiary rules that prohibit offering evidence of previous missteps as a way to chart similar mistakes in the present. The philosophy behind such rules is simple: A defendant’s culpability for a particular incident ought to be established by evidence of the defendant’s conduct in that particular incident—not through unrelated conduct that occurred in the past.
Under the umbrella of process safety, however, plaintiffs portray prior incidents as evidence that a company failed to learn from past mistakes and correct known systemic safety issues. Plaintiffs may even attempt to group personal safety statistics—such as the number of slips, trips, falls or dropped objects—with catastrophic failures as evidence of a systematic safety problem. The effectiveness of these attempts can mean the difference between a finding of no liability and negligence, a finding of negligence or gross negligence, or an award of punitive damages.
