PROUD - THE ADVISOR

By David Bronner - Director, Alabama Retirement System

From the Advisor - Monthly Newsletter to the Retirement System of Alabama

The jury’s decision last December to award Alabama $3.5 billion in a civil judgment against Exxon made me proud of the Alabamians who took the initiative to attack those who try to take advantage of our great state. Alabamians are lucky and blessed to have citizens who will take the lead to accomplish such actions.

The royalty dispute had its beginnings when a conscientious state employee, Conservation Department attorney Bob Macrory, drew up the lease agreement after serious research and assistance from other oil-producing states. Then, five years ago, former Governor Fob James and Conservation Commissioner Jim Martin hire auditors to scrutinize the Exxon oil payments to the state.

However, the Exxon judgment would never have happened without Governor Don Siegelman and Attorney General Bill Pryor’s leadership and support. Governor Siegelman employed the Mobile law firm of Cunningham, Bounds, Yance, Crowder and Brown to do the heavy lifting. This gave Attorney John T. Crowder, my law school classmate, the high-risk, high-reward opportunity to fight the Goliath of the oil industry as Exxon’s $17.7 billion in net income for 2000 proves.

After two years, the firm found not one, not two, but nine “smoking guns.” When the Chairman of Exxon thought Alabamians were too dumb (he said “inexperienced”) to catch a thief, he greatly underestimated the talent and intelligence of the Alabamians involved. The chairman even went so far as to state that even if a judgment were place against Exxon, it would only cost them a little interest. The jury certainly proved Exxon wrong with their $3.5 billion verdict.

Clearly, Exxon ignored what was legal, ethical and the right thing to do when the verdict was so large and Alabama was only claiming $87.7 million in compensatory damages. This case is not a simple contract dispute but regards a big corporate thief.

Jury awards are often reduced on appeal by the judge or appellate courts, yet this judgment should withstand any appeals to state or federal courts. This case is a warning to businessmen that they have nowhere to hide when abusing the taxpayers and citizens of this great country.

As I wrote last month, there are some “good politicians in Alabama.