Wednesday, February 2, 2011

Will the GOP Help BP Get Away With a Fast One on the Alabama Coast?

Luther Strange

Was it smart for Alabama to elect a Republican attorney general with ties to the petroleum industry--just months after the BP oil spill?

Probably not.

Luther Strange has been in office less than a month, and he already is showing signs that he will try to limit Big Oil's damages from the Deepwater Horizon disaster. Folks who know about Strange's ties to the Birmingham law firm of Bradley Arant Boult and Cummings will not be surprised that he might take questionable actions that stand to favor corporate interests.

Strange's first curious move came last week when he announced that he has dismissed private attorneys brought in by predecessor Troy King to handle lawsuits connected to the oil spill in the Gulf of Mexico. Strange will head up the litigation himself.

Why is this troubling? An article from Reuters Legal spells it out:

The case has posed a sensitive political issue for Strange. In the 2010 primary, King seized on Strange's previous work as an oil industry lobbyist, which he argued would impede Strange's ability to take on BP. In particular, Strange was registered to represent Transocean Offshore Drilling . . . on matters related to offshore drilling for six months in 1998, federal records show. Transocean's successor company owned the Deepwater rig that exploded in the Gulf of Mexico.

Strange's ties to Transocean actually are much deeper than that paragraph suggests. In fact, his ties to the company that became Transocean date back to the 1980s. And that's because Transocean essentially was born in Birmingham, which long has been Strange's home base. Reports the Mobile Press-Register:

Transocean's corporate roots are planted in Alabama. The company was born in 1973 as Sonat Offshore, a subsidiary of Sonat Inc., a Birmingham-based natural gas utility that was an Alabama economic powerhouse for much of the 20th century.

Strange was hired by Sonat in 1980 as a young lawyer straight out of Tulane University. He was promoted to head of the company's Washington office in 1985 and represented Sonat in Congress until 1994, when Strange left the company but continued to represent it as a contract lobbyist.

Sonat spun off its Transocean subsidiary in 1996, and the drilling company was transformed by a series of mergers and acquisitions over the next decade. Once based in the tallest building in downtown Birmingham, its headquarters today are in Zug, Switzerland.

Anyone who is familiar with downtown Birmingham can point out the building that used to be known as the Sonat Tower. The company has undergone changes, but the building still stands tall:

The publicly owned Transocean Ltd. has more than 26,000 employees in 20 locations around the world. Sonat merged with El Paso Corp. in 1999.

Is Luther Strange handling the BP litigation so he can help manage the damages for one of his former clients? Alabamians should give that question some serious thought. Republicans on the Alabama Supreme Court, known as the "Exxon Eight," already have cheated the state out of more than $3 billion in a fraud verdict against ExxonMobil. Don't be surprised if the fleecing of regular Alabamians continues on Luther Strange's watch.

We're already seeing signs that the Alabama State Bar might be working as an accomplice for Strange. Reports Reuters Legal:

In a letter dated Aug. 19, Alabama State Bar General Counsel J. Anthony McLain advised Strange that his work with Transocean would present a conflict only if Strange had obtained confidential information during his employment with Transocean that could be used against the company in litigation. Strange maintains he has no conflict. BP declined to comment on the issue.

Talk about turning an issue on its head. It's highly unlikely that the fine folks at Transocean have anything to worry about with Luther Strange. After all, he's their boy. It's the regular citizens of Alabama who have cause for concern about our state's new AG.

Isn't it interesting that Tony McLain, of the Alabama State Bar, sees no possible conflict if Luther Strange uses his 30-year ties to Transocean to help fleece the public?

Looks like it's business as usual in Alabama.


Robby Scott Hill said...

On ethics matters, the State Bar acquiesces to big city corporate interests, but they will crush any country lawyer who represents Working People. I know all about Sonat from my work at the Conservation Department & Florida East Coast Industries. Sonat (short for Southern Natural Gas) is a subsidiary (for tax purposes) of my old friends at El Paso. Before it went bankrupt ENRON Energy Services d/b/a Florida Gas Transmission was a partner in Sonat. Florida Gas Transmission & Sonat owe the State of Alabama a lot of money in unpaid rents & fees for their Pipeline Rights of Way or PROW & Submerged Pipeline Rights of Way or SPROW. The Conservation Department claimed it didn't have enough money to give me the pay raise I was due. Yet, Commissioner Barnett Lawley sent his son to law school & my supervisor James Hillman Griggs reclassified his job title & raised his pay to over $130K a year while they got away with not paying what they owed Alabama taxpayers. You & I need to go to Montgomery & audit all of their unpaid contracts.

legalschnauzer said...

Great insights, Rob. Thanks. I knew about Luther Strange's ties to Bradly Arant and Transocean. But I did not know about Transocean's ties to Sonat, and how far back "Big Luther" goes with Sonat. Has Alabama just let Sonat and its affiliates get away with not paying their bills? Interesting to compare that to credit-card companies that sic debt collectors on people when they can't even prove the debt is owed.

Robby Scott Hill said...

In the wake of the Exxon royalty scandal, BP worked hard to maintain a very low profile in Alabama. They conduct most of their offshore oil & gas exploration in the State of Alabama as a silent partner of a Japanese company called Marubeni Energy

If you want to know how all these lawyers & state officials are getting paid off, the money trail starts with the offshore oil leases to Marubeni. I'm talking tens of millions of dollars in wires with plenty of opportunities to skim a little off the top.

This is done via the "creation of litigation" & outsourcing legal work that lawyers at The Attorney Generals Office should be doing themselves. "The Families" as Bob Riley likes to call them are rewarded through contracts that bypass the normal contracting and purchasing channels & are always awarded to hand picked university departments that have the Families on the payroll & real estate firms where members of "the Families" are silent partners.

Money is fungible. When I worked for the Conservation Department. I designed grants to the University of Alabama & Auburn to do "scientific research" knowing that they only needed X amount of dollars to do the research. However, I awarded the grant in an amount ten times greater than what they actually needed knowing that the university would turn around & hire "The Families" & pay their fees out of the other 90% of the grant funds. In subsequent quarters we would ask the university to invoice us for adequate cost overruns and formally request change orders & extensions to the contracts & grants to cover everything & it's all legal because the Contract Review Committee has no real power & there are no criminal penalties for this in the Alabama Code. It's just a dog and pony show. The Alabama Mafia's core source of income is oil & natural gas revenue & they will invent all kinds of contracts & grants to launder the funds. Then there's Paul Bryant Jr. Bank where the end recipients of the funds keep the grand totals of their ill gotten gains a secret.

Does this explain why Paul Bryant Jr., a guy whose alleged expertise is in college football fund-raising & the reinsurance industry was always calling my desk & leaving messages for James Hillman Griggs an oil & gas attorney whose alleged expertise was hanging out in the woods & watching birds?

Follow the money Roger Alan Shuler & the truth when it is fully revealed will be stranger than fiction.

Robby Scott Hill said...

Yep, I'm allegedly unfit to take the bar exam & lacking the required character over a few grand in unpaid credit card debt, much of which I racked up working for peanuts at the State with my pay frozen while these lawyers got paid the big bucks to help their clients get away with not paying the very debts that would have helped fund the pay raise I deserved & needed to pay off my loans. They buy new homes, luxury cars & send their kids to college, law school & buy them into partnerships at professional firms on the money they cheated the taxpayers out of. Anybody who cares (like you and me) are forced out of our government jobs & replaced by folks who will turn a blind eye to the game. The system perpetuates itself. Time is not on our side. These dudes' two year old grandchildren are going to graduate from law school, pass the bar, go to work for the big corporate defense firms and perpetuate the system of self interest before we can do anything about it, but it needs to be well documented so the next generation will have the information it needs to tear down this system or corruption. I'm calling on every newly minted 25 year old lawyer who passes the bar exam this year to dedicate their career to doing something about it.

Max Shelby said...


With your permission we are going to link your column to our recent offering on the Pittman fleece job.

New Day in Alabama Ethics Reforms Keep Sunshine Off of Senator Trip Pittman's Fleece Job

It's all part of the same ugly picture of merchants of tragedy profiteering in our opinion.


legalschnauzer said...


Sure thing. Thsnks for shining light on this subject.


Anonymous said...

So Enron Energy Services was a partner in Sonat....hmmmmm......

Early on, Reed discovered the potential for synergy between the business and political worlds. For instance, one of his first and highest-profile consulting jobs was for Enron, a client that he garnered in 1997, reportedly through his connections to Karl Rove, who later made Reed a consultant in the 2000 presidential campaign. Century Strategies earned more than $300,000 from Enron for mounting grassroots lobbying campaigns to help build backing for energy deregulation." Other clients have included the school-focused media company Channel One, Verizon and casino interests working with Reed friend Jack Abramoff in an effort to block Native American tribes from opening new, competing casinos.[citation

Anonymous said...

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