US: Class-action case sought over Katrina oil spill

Attorneys argued in federal court on Thursday over whether homeowners whose property fell victim to an oil spill from Hurricane Katrina can band together and sue Murphy Oil Corp in a class-action lawsuit.

At the hearing before U.S. District Court Judge Eldon Fallon, attorneys for residents of St. Bernard Parish, where the spill occurred, argued Murphy is responsible for oil damage to some 10,000 houses in an area of about 6 sq miles (15.54 sq km).

Murphy's attorneys told the judge that the spill, which the company has blamed on an "act of God," affected fewer homes and that those residents do not constitute the legal basis for a class-action lawsuit.

The judge is expected to issue a written ruling deciding whether the case should become a class-action lawsuit following the hearing, which was slated to continue through Friday.

In a class action, one suit is filed on behalf of a large number of people who have similar claims.

The spill sent some 25,000 barrels of crude oil from a storage tank at Murphy's Meraux refinery in St. Bernard into the surrounding community and drenched houses in several feet of oily sludge.

St. Bernard Parish, which lies to the east of New Orleans and had a pre-storm population of almost 70,000 people, was devastated by the August 29 hurricane and the flooding that followed.

"The release of crude oil from Murphy Oil turned a community otherwise contaminated by floodwater into a community contaminated by toxicants," said Joe Bruno, an attorney for the residents. "The dominant issue is the necessity of a community-wide clean-up."

Local officials have said at least half the 27,000 homes in the parish may have to be razed, and others will need extensive clean-ups or major repairs.

About two dozen people already have filed individual lawsuits against the El Dorado, Arkansas-based Murphy that could be merged into a class-action case.

Murphy's attorney Kerry Miller said the company has settled privately with about 5,400 people in about 1,800 homes, paying out about $50 million to residents and $13 million to clean up public property.

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