Last Friday, against the vehement and public urging of his own Attorney General and nearly one hundred of the nation’s most respected legal experts, Governor Bobby Jindal signed Senate Bill 469 into law. Quoting his press release (bold mine):
Governor Jindal said, “This bill will help stop frivolous lawsuits and create a more fair and predictable legal environment, and I am proud to sign it into law. It further improves Louisiana’s legal environment by reducing unnecessary claims that burden businesses so that we can bring even more jobs to our state. The bill will also send future recovered dollars from CZMA litigation to coastal projects, allowing us to ensure Louisiana coastal lands are preserved and that our communities are protected.”
If you’re wondering who, exactly, the law benefits, all you need to do is keep reading Jindal’s press release, which contains this amazing confession. Quoting (again, bold and italics mine):
LOGA President Don Briggs said, “The signing of SB 469 is a huge victory for the oil and gas industry as well as the economy for the state of Louisiana. We commend Governor Jindal for his leadership and support of this bill as it made its way through the process….”
As I mentioned in a previous post, SB 469 was, ostensibly, about stopping a controversial, landmark lawsuit filed by the Southeast Louisiana Flood Protection Authority-East (SLFPA-E) against 97 oil and gas companies for their role in illegally damaging and depredating the state’s coastal environment and ecosystem. But as we now know, the law is about much more than merely ending a single lawsuit by a single governmental authority.
SB 469 appears to have been written and deliberately designed by lawyers who represent the oil and gas industry in order to shield, reduce, or eliminate their clients’ exposure to civil damages on a wide range of pending and future claims, including, most notably, BP’s liability for billions of dollars in outstanding claims related to the 2010 Deepwater Horizon catastrophe. Indeed, according to people intimately involved in the legislative process, no one lobbied harder for the passage of SB 469 than those associated with BP.
With the stroke of the pen, Governor Bobby Jindal likely saved the oil and gas industry billions of dollars in damages for which they otherwise would have been legally responsible, damages that are legitimately owed to hundreds, if not thousands, of hardworking families, businesses, and coastal communities who were devastated by and continue to suffer from the lingering effects of the worst environmental disaster in American history. Governor Jindal may claim this was about ending “frivolous lawsuits” and creating a “more fair and predictable legal environment,” but unfortunately for him, the geniuses on his communications team allowed Don Briggs, the President of the Louisiana Oil and Gas Association, to tell it like it is, “a huge victory for the oil and gas industry.” To be sure, that may actually be an understatement.
This wasn’t about ending frivolous lawsuits or better ensuring a fair and predictable legal environment; it was about rigging the law in favor of the biggest, wealthiest, and most powerful industry in Louisiana (and arguably, the world).
Thomas Enright, the Governor’s Executive Counsel, argues that claims for damages against BP would not be affected by SB 469, because the federal Oil Pollution Act preempts the new Louisiana state law. Notwithstanding the irony and the hypocrisy of Governor Jindal, seemingly for the very first time in his entire career, invoking and championing the preemption doctrine, Enright may very well be correct in his analysis.
But the simple fact is: BP’s lawyers can and will argue otherwise; it’s an issue of first impression that will ultimately be determined by the courts, not by Jindal’s attorney. SB 469 provides a new and novel line of defense. Indeed, Louisiana’s Attorney General and nearly 100 legal experts from the nation’s top law schools all agree. The oil and gas industry’s lawyers know it’s true, too; after all, by Governor Jindal’s own admission, they helped write the law.
Even if Enright is, in fact, right and even if the courts eventually rule against BP, because these issues will take months, if not years, to fully resolve, Jindal’s decision to sign and enact SB 469 almost certainly reduced substantially the anticipated settlement values for thousands of Louisiana citizens. And that‘s why BP stands to gain billions of dollars. Remember, BP has enormously deep pockets; if they wanted to, they could afford to litigate these claims for the next century without ever affecting or even touching their bottom line. The average citizen, however, cannot afford and would never be inclined to wage a war of attrition against BP about the preemption doctrine as it relates to state law conflicting with the Oil Pollution Act.
Remember too, the longer the legal process, the less those who were affected and damaged by BP’s negligence can expect. In a complex case involving billions of dollars, a broadly and vaguely worded new law can have an enormous economic value.
Make no mistake: Governor Jindal understood this. As reported by Patrick Flanagan of The Independent Monthly, Nikesh Jindal, Bobby Jindal’s younger brother, “is an attorney with Gibson Dunn, one of the law firms representing BP against the damage claims… assigned to the division handling BP’s case,” a critical detail and potentially a massive conflict of interest that has never been fully explained or even properly disclosed. If Governor Jindal’s brother Nikesh didn’t explain the stakes to him, Jimmy Faircloth, Jindal’s former executive counsel and longtime confidant, should have. Quoting from The Times-Picayune (bold mine):
Also, the claim that SB 469 got a full public airing isn’t true. The bill was cobbled together late in the session by the governor’s former executive counsel, Jimmy Faircloth, and switched to a different Senate committee hours before a hearing on it. That limited public input. Mr. Verchick pointed out in a response to Mr. Enright Wednesday that the chairman of the House Natural Resources Committee also curtailed debate on the bill.
It’s worth noting that Representative Gordon Dove, the chairman of the House Natural Resources Committee, didn’t just shut off debate on the bill; he also refused to read into the record, as is customary, the names of citizens who showed up to support or oppose the bill. If he had, he would have revealed that ten times as many people, almost all of whom were either coastal activists or environmental professionals with no personal financial interest whatsoever, showed up to oppose the bill than those who showed up to support the bill, almost all of whom were being paid by organizations, agencies, and companies with a direct financial interest. (I am in receipt of this documentation and can send it upon request; I’m not posting it out of an abundance of caution, because it contains the home addresses, phone numbers, and e-mail addresses of private citizens).
If it weren’t already obvious that SB 469 had little to do with ending the SLFPA-E’s lawsuit and almost everything to do with broadly immunizing the oil and gas industry from a wide range of otherwise legitimate claims, Governor Bobby Jindal made it abundantly clear only a few hours after he signed the bill into law. Later on Friday, Jindal announced he was replacing Tim Doody, the Chairman and founding member of the SLFPA-E, with a former oil and gas industry insider who openly admitted his biases and ignorance. Quoting from The Advocate (bold mine):
In a second blow to the flood protection authority Friday, Jindal announced that Tim Doody, a St. Bernard Parish resident who has served on the authority since it was created, will be replaced by Tyrone Ben, a fellow St. Bernard resident who works for the Guidance Center, an outpatient behavioral health and counseling center. Doody is the fourth member of the authority who supported the suit to be replaced since the case was filed.
With Doody’s replacement, only five of the nine members of the board are on record in favor of continuing the suit. Two more members, one who supports the suit and one who opposes it, are expected to be up for renomination later this year.
Ben, who was urged to apply for a seat on the board by former St. Bernard Parish President Craig Taffaro, currently an official in Jindal’s administration, said he did not have a “political agenda” in applying for the seat.
Based on his experience working for oil and gas companies, Ben said, he is inclined to believe that because energy companies needed to receive permits for their work, they were already being regulated and the lawsuit was not necessary. However, he said he was willing to listen to those who disagree.
“I don’t know anything on the other side of the argument,” Ben said. “I would be open-minded. I would be willing to listen. Evidently they had something that compelled them to file it in the first place.”
Jindal officials have said opposition to the suit would be a “litmus test” for all new appointees to the authority, and Ben said he was asked about the case by Jindal administration officials prior to his appointment.
“I said if my selection was predicated on that, I might not be the best person for the job,” he said.
Because he was appointed after the session ended, Ben will not have to face Senate confirmation until next year’s session. Jindal’s other three appointees were all confirmed by the Senate this year.
Despite Mr. Ben’s equivocations, he was, very obviously, selected to oppose the authority’s lawsuit, and because Mr. Jindal has the opportunity to replace two more members within the year, including one who supports the lawsuit, the Governor will almost certainly have the five votes he needs for the SLFPA-E to withdraw the case within the year. In other words, SB 469 was not necessary at all for Mr. Jindal to ensure that the SLFPA-E’s lawsuit was dropped. That may have been how the legislation was sold to the public, but again, that’s not what the law actually does. Indeed, several legal experts argue that SB 469, due to its purposely sloppy and overly broad statutory language, won’t affect the SLFPA-E’s lawsuit at all.
Before I ask what I believe to be the single question that could destroy Bobby Jindal’s political future, I think it’s important to focus first on what may be the most astonishing accomplishment of his career. To be sure, the accomplishment doesn’t actually belong, exclusively, to him; it also belongs to his wife Supriya.
Only a few short months after he was elected to his first term, Bobby Jindal’s wife Supriya established The Supriya Jindal Foundation, a tax-exempt and tax-deductive charity that provides schools with high-tech whiteboards, a worthy pet cause that immediately was embraced by some of Louisiana’s most powerful companies. In almost no time at all, the Supriya Jindal Foundation went from an up-start that existed only on paper to a full-fledged organization with millions of dollars in the bank. Its astronomical success at immediately cultivating major donors and raising vast sums of money had never been done before in Louisiana, and it provided the new First Lady of Louisiana with the platform and the resources necessary to embark on annual statewide goodwill tours, doling out hundreds of thousands of dollars worth of much-needed technology to teachers and schools.
Unfortunately for Bobby and Supriya Jindal, eventually, people began asking questions about where all of that money actually came from, and once they started asking questions, it didn’t take long to figure out that the Supriya Jindal Foundation was funded, almost exclusively and entirely, by companies seeking special incentives and preferred treatment from the State of Louisiana. Quoting from a 2011 report in The New York Times (bold mine):
AT&T, which needed Mr. Jindal, a Republican, to sign off on legislation allowing the company to sell cable television services without having to negotiate with individual parishes, has pledged at least $250,000 to the Supriya Jindal Foundation for Louisiana’s Children.
Marathon Oil, which last year won approval from the Jindal administration to increase the amount of oil it can refine at its Louisiana plant, also committed to a $250,000 donation. And the military contractor Northrop Grumman, which got state officials to help set up an airplane maintenance facility at a former Air Force base, promised $10,000 to the charity.
The foundation has collected nearly $1 million in previously unreported pledges from major oil companies, insurers and other corporations in Louisiana with high-stakes regulatory issues, according to a review by The New York Times.
Dow Chemical, which has pledged $100,000 to the foundation, is the largest petrochemical company in Louisiana and has had numerous interactions with state officials during the Jindal administration, including an investigation into a July 2009 spill at its St. Charles Parish plant that forced the evacuation of area homes. The state in December 2009 proposed fining the company and its Union Carbide subsidiary for allowing the release of a toxic pollutant and failing to quickly notify state authorities of the leak, but so far no fine has been assessed.
Alon USA, an Israeli oil company that has pledged $250,000 to the Jindal Foundation, last year sought permit changes that would allow it to discharge more pollutants at its Krotz Springs refinery. In 2009, state environmental officials also eased requirements for the company to check for spills of oil, ammonia or other contaminants in waterways to twice a month, instead of twice a week, records show.
Several of the charity’s major donors are large state contractors, like Acadian Ambulance, or D&J Construction, which alone has received $67.6 million in contracts since 2009, mostly for highways, said a separate report on the foundation being issued this week by Citizens for Responsibility and Ethics in Washington. Both companies have pledged at least $10,000 to the foundation.
Since The New York Times report, the Supriya Jindal Foundation appears to have dramatically scaled back its activities. Aside from a few minor edits, its website hasn’t changed in years. According to its most recently available 990 report, the organization has no employees and only three officers, all unpaid: Supriya Jindal, Jeff Anger, a former lobbyist who runs a political action committee, and Lynn Moore, the wife of Jeff Moore, a member of the LSU Board of Supervisors and a hotelier who inherited his fortune from his family’s oil and gas company.
Perhaps not surprisingly, at the time of The New York Times report, Governor Jindal’s press secretary Kyle Plotkin (who was recently promoted to Chief of Staff) was not too thrilled. Quoting (bold mine):
“It is a completely nonpolitical, nonpartisan organization created by the first lady, who as an engineer and the mother of three children, has a passion for helping our young people learn science and math,” said Kyle Plotkin, the press secretary. “Anything other than this reality has plainly been dreamed up by partisan hacks living in a fantasy land.”
The inability of Governor Jindal and his staff to recognize the enormous concerns raised by the size, the timing, and the source of corporate donations to his wife’s foundation and the arrogant, bombastic dismissiveness with which they treated those concerns were and continue to be troubling.
But if you care about the corrosive influence of money in our political process, the potentiality of a government defined by closed door quid pro quo agreements between elected leaders and their corporate benefactors, then you should be even more alarmed by the newest Jindal non-profit.
Three months after the SLFPA-E filed its landmark lawsuit against 97 oil and gas companies, Bobby Jindal launched America Next, a 501(c)(4) social welfare organization that many immediately perceived to be a launching pad for a 2016 Jindal Presidential campaign.
If, in fact, America Next is nothing more than about promoting Jindal’s candidacy, through the ruse of promoting his “ideas,” (and all indications, thus far, are that it is), then it, undoubtedly, violates federal tax laws regulating and defining 501(c)(4) social welfare organizations. Donations to Jindal’s new organization aren’t tax-deductible, but the organization is still tax-exempt. And perhaps most importantly, as a 501(c)(4), America Next isn’t required to disclose any of its donors to the public.
When Jindal was first elected Governor of Louisiana in 2007, he promised a new era of transparency in government. He campaigned on implementing the “gold standard” of ethics reform. He lambasted the cronyism and corruption that had defined state politics for decades, depicting his opponents as clowns who were willing to do anything for a bribe.
Seven years later, approaching lame duck status, Bobby Jindal is preparing his exit from the Governor’s Mansion by establishing a tax-exempt organization intended to promote his candidacy for national office, and when asked if he intended to reveal the donors to his new organization, Jindal not only refused, he acted as if disclosure of his donors – the very definition of transparency- was nothing more than a trap set by his political opponents. Quoting from The Times-Picayune (bold mine):
During a breakfast meeting with political reporters Wednesday, in which he unveiled a market-alternative alternative to the Affordable Care Act prepared by America Next, Jindal was asked whether he would reveal the group’s financing. He referred the question to the group’s executive director, Jill Neunaber, a former aide to the 2012 Mitt Romney for President organization.
It didn’t take long for Neunaber to respond to an email question:
“America Next is a 501(c)(4) that will make all disclosures as required by law,” she said in an email. “Beyond that we do not see any reason to give the Obama Administration opportunity to unjustly target conservative donors.”
The glaring truth is: America Next isn’t a social welfare organization, and it shouldn’t be tax-exempt under Section 501(c)(4). It’s an organization of political consultants, led by a woman who most recently worked for Mitt Romney’s campaign, in order to support Jindal’s candidacy, and they’re all hoping that everyone else is too dumb, too lazy, or too scared to call them out for openly breaking the law. If Bobby Jindal wants to build an infrastructure for a 2016 campaign, he should have formed a Political Action Committee; that would have also provided him with certain tax exemptions. But there’s one major difference: Unlike a PAC, 501(c)(4)s aren’t required to disclose their donors.
So, for the next year or two, Jindal hopes we all ignore his blatant disregard of laws that are designed to ensure transparency and the public’s right to know who is paying their elected officials on the side, how much they’re paying, and when those payments are made. Jindal hopes we’ll consider America Next to be his quaint little think tank, and he’s banking on the belief that Louisiana citizens won’t group the donations to his new non-profit with his actions as Governor. But as his wife’s foundation proves, it would be foolish not to look into who is bankrolling his organization.
That’s the single question that could destroy Bobby Jindal’s political future: Who?