[StBernard] MR-GO case damages could exceed $1 billion

[Westley Annis]

MR-GO case damages could exceed $1 billion
by Mark Schleifstein, The Times-Picayune 
Tuesday August 04, 2009, 8:34 PM

The government of St. Bernard, as well as residents and businesses of the
parish and some New Orleans neighborhoods, could receive a share of more
than $1 billion in damages when a federal judge issues a final ruling in a
lawsuit over the lost value of their land caused by construction of the
Mississippi River-Gulf Outlet, attorneys for plaintiffs in the case said
Tuesday.


U.S. Court of Federal Claims Judge Susan Braden, an appointee of George W.
Bush based in Washington, ruled Monday that plaintiffs in the case
demonstrated a trial was warranted to determine how much the federal
government should pay.

The lawsuit stems from the U.S. Constitution's Fifth Amendment, which
provides "private property (shall not) be taken for public purpose, without
just compensation." Braden said evidence of severe flooding in 2005 and
other flooding since showed the plaintiffs are entitled to seek compensation
for the value of their land "taken" by the federal government.

She delayed the trial until after a judge's ruling in a separate suit
charging the MR-GO caused some of the flooding damage after Hurricane
Katrina.

U.S. District Judge Stanwood Duval is expected to deliver a verdict in that
case in September.


St. Bernard Parish President Craig Taffaro said Monday's decision may set
the stage for the federal government to negotiate alternate ways of
compensating residents -- and local governments -- for the damage caused by
the MR-GO.

"We expect that our government will come to our rescue and be accountable,
put the funds in place so that the mitigation that must take place to
protect our land that is so valuable ... is put into proper perspective, "
Taffaro said.

Justice Department spokesman Andrew Ames would not comment on Braden's
ruling, "as this is a matter currently in litigation."

Gerald Maples, lead attorney for plaintiffs in the "takings" lawsuit, said
he wouldn't be surprised to see the federal government given a choice of
paying money to those affected by the MR-GO on a case-by-case basis or
devising a plan to spend the money on environmental restoration efforts and
compensation of residents.

Maples said the complicated part will be determining exactly how much is
owed to property owners. The damages should include loss of land, loss of
business revenue, and loss of St. Bernard Parish's tax base, he said.

But the potential damages also will include the loss of wetlands habitat
adjacent to the canal, he said.

"We have to work with scientists to determine whether or not we can place a
dollar value on the loss of ecosystem, which is probably the highest dollar
issue involved in this case, " he said. "Without question, billions. We've
moved past the 'M' (millions) word."

And, he said, Braden also will be asked to consider whether St. Bernard can
survive the erosion caused by the channel, and if not, how much compensation
should be given to local governments and residents for future losses.

Maples said Braden's ruling is clear in saying residents and businesses in
St. Bernard Parish and the Lower 9th Ward of New Orleans are eligible for
compensation. Less clear, he said, is whether the judge will agree that
damage during Katrina in eastern New Orleans or to neighborhoods west of the
Industrial Canal are related to construction of the MR-GO. Duval's ruling
will help direct the judge in that issue, Maples said.

Maples warned residents and businesses who believe they're eligible for
compensation under the lawsuit that they must file claims within a year of
this past April, when the Army Corps of Engineers began closing the MR-GO
with a rock dike, because federal lawyers will attempt to argue that the
channel's ill effects were halted then. The claims process is expected to be
approved by the judge in September, he said.

Wayne Mumphrey, another attorney in the case, said he doesn't think the
government will succeed in arguing that the dike stopped the damage caused
by the MR-GO, because adjacent wetlands will continue to erode until they
are fully restored.

. . . . . . .

Mark Schleifstein can be reached at mschleifstein at timespicayune.com or
504.826.3327