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Exxon Valdez and Price William Case Study

In: Business and Management

Submitted By pperez26
Words 1326
Pages 6
Introduction

March 24, 1989 a mase oil spill occurred in Alaska, Prince William Sound, an oil tanker Exxon Valdez had ran into a reef. The spill was approximately 11 million gallons into the sea, affecting the wildlife, the environment, and the region’s economy. It was a fact that Alaska could not hold a spill over 8.4 million gallons and could result in long-term consequeses. Exxon, along with other oil industries knew that navigating a large supertanker through the waters of Prince William Sound would be extremely complicated. Even with this kind of knowledge, Exxon still decided to navigate through there.

1. Problem

In every situation there is a cause and effect. Here, Exxon had knowledge that traveling through Prince William Sound would be very difficult. Since they were aware of that, I would propose that they could of taken a different route. Not sure where there start and end locations were. If they had to go through Prince William Sound, could there have been an alternate of dividing the oil carried. Exxon only had one big tanker, could they have not had two or three smaller tankers, taking this route on different trips.

Secondly, the prior history with the captain’s alcoholism is a problem. The lack of judgment on Exxon’s behalf because they knew Captain Joseph Hazelwood had a drinking problem and kept him employed. The captain had supposedly been rehabilitated, but Exxon knew better before March 24, 1989. Hazelwood. Had sought treatment for alcohol abuse in 1985 but had "fallen off the wagon" by the spring of 1986. He continued to drink and even went as far as drinking while on board. Despite his relapse, Exxon continued to employ Hazelwood and have him command supertankers, which carried hazardous cargo. Exxon showed negligent and ethically no concernment for employee’s safety and well being. In addition, there was a risk traveling through Prince William Sound, yet they allowed a relapsed alcoholic lead the operation of the Exxon Valdez.

It was also reported that the tanker was actually not steered by Captain Hazelwood at the time of the collision, but by a third mate. The captain gave specific orders to the third mate, and when went below to do paperwork. The third mate did not follow orders and by time he realized his mistake it was too late. So here the third mate did not know how to receive and follow through on assignments given. The third mate did not follow orders could have been from being over worked and tired, however, there was not a solid conclusion why he did not follow the instructions given.

The 1989 oil spill at Prince William Sound could have been avoided had everyone involved would have done ethically. As stated previously, Exxon officials knew of Captain Hazelwood alcoholism and overlooked it for their own benefit. They chose to pass through Prince William Sound knowing it was risky. The third mate chose not to follow Captain Hazelwood’s instruction. Lastly, had Captain Hazelwood been sober, he could of steered the tank, or been able to watch (make sure) the third mate did as told. I think they all played a role in the oil spill and made decisions based on them versus what is good for everyone.

What happen to the key players

Exxon officials and Captain Hazelwood were the only defendants in this case. They were charged for breaking many laws/acts in addition, they had various civil suits that were brought against them.

Exxon was prosecuted by the federal government for various environmental crime: violating the Clean Water Act, violating the Refuse Act, violating the Ports and Waterways Safety Act, and violating the Dangerous Cargo Act. Exxon ended up pleading guilty to one count of violating the Migratory Bird Treaty Act. In addition, Exxon Shipping pled guilty to one count each of violating the Clean Water Act, the Refuse Act, and the Migratory Bird Treaty Act. As a whole they were fined twenty-five million dollars and had to pay restitution of one hundred million dollars.

The federal government was not the only ones taking Exxon to court. They also were taken to court for civil cases that were consolidated, municipal claims, and some native corporation claims. This resulted in Phase I of Exxon, Exxon shipping, Captain Hazelwood guilty of punitive damages in all claim cases. In addition they were found guilty of compensatory damages for plaintiffs’ economic losses in Phase II. Which then resulted in Phase IIA of a fishermen awarded of two hundred and eighty-seven million. Also in Phase IIB they were guilty of native economic claims, which settled without trail for twenty-two point six million dollars. There was two more phases to the trial against Exxon and Captain Hazelwood. The final judgment had them paying five billon dollars in punitive damages, and five thousand for Captain Hazelwood. Exxon appealed and got their amount then reduced to five hundred million dollars. This oil spill was very horrible and Exxon and Captain Hazelwood had a big price to pay.

2. Analyze the situation

There are many people in life that make decisions for oneself without caring or realizing the effect on others. Exxon and Captain Hazelwood both made selfish decisions and were not thinking about the well being of others. I think the oil spill could have been afforded had Exxon dealt wit Captain Hazelwood instead of overlooking his drinking problems. Also, Captain Hazelwood knew he had a big tour but still decided to put the people and the environment in jeopardy by going out to the bar and drinking. He also, could have ensured the third mate followed his instruction by staying with him instead of going to do paperwork.

Alcoholism is something serious and should not have been over looked by Exxon. There weren’t any facts of why or how Captain Hazelwood became an alcoholic. An according to the book, the cognitive theory best describes the reason why both Exxon and Captain Hazelwood did not take the alcoholism serious. Cognitive theories are the stress inadequate moral and intellectual development as being at the root of criminal acts. I feel like Exxon had poor judgment and no moral thought for the lives and the environment to continue to have Captain Hazelwood continue employed knowing he had a drinking problem. I honestly, feel Captain Hazelwood has no intellectual development to think it is morally, and ethically right to take shots before he is schedule to steer the tank. Drinking too much alcohol can cause brain damage. Alcohol interferes with the brain’s communication pathways, and can affect the way the brain looks and works. These disruptions can change mood and behavior, and make it harder to think clearly and move with coordination. This alone is a prime example why Captain Hazelwood shouldn’t been able to still be employed. Alcoholism taking lightly caused poor decisions and ultimately caused the oil spill at Prince William Sound.

3. Present Solution

The logical explanation for the situation would be for Exxon to not have had Captain Hazelwood as an employee. If they did not want to let him go, once they received that Captain Hazelwood had fallen off the wagon and relapsed, they should of put him back in rehab. In addition, once he completed rehab, he shouldn’t instantly be in charge to control the tank, but rather work his way back up to that position. In addition, Captain Hazelwood should have recognized what he had to do, and decided not drink. He should of put his job and position first rather than himself.

References

1. “HISTORY OF THE EXXON VALDEZ OIL SPILL” http://www.wholetruth.net/history.htm
2. “Exxon Qualified Settlement Fund-Litigation History” http://www.exspill.com/news/litigationhistory/tabid/1918/default.aspx
3. Friedrichs, David O. “Trusted Criminals”: White Collar Crime In Contemporary Society, 4th Edition. Cengage Learning, 2009. VitalBook file.
4. “Alcohol’s Effects on the Body”
http://www.niaaa.nih.gov/alcohol-health/alcohols-effects-body

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