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Thursday, 20 November 2014 06:13

Oil Company Tries to Shake Down California County for $1.2 Billion for Banning Fracking

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anotfrack(Photo: Daniel Lobo)

The oil company Citadel Exploration didn't like that the citizens of San Benito County, California, passed a fracking ban this November. (The county is ironically located just west of a town called Bittersweet.)

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Citadel Exploration believes that the right to frack away - with all its destructive impact - supersedes the passage of Measure J, which prohibits future fracking in San Benito. So Citadel filed a lawsuit that would require the county to pay it $1.2 billion in lost profits.

KSBW.com of Monterey California summarized the Citadel legal extortion:

Citadel owners claim they could have extracted 20-40 million barrels of oil [in San Benito county], a value they believe equals $1.2 billion.

"$1.2 billion. That's like asking for the moon. The county will file for bankruptcy and reorganize. He’s not going to get anything,” San Benito County Supervisor Jerry Muenzer said.

"We don’t have that kind of money ever, ever," supervisor Muenzer said. Such a judgement would leave the county broke....

The company is arguing that Measure J constitutes "regulatory taking," meaning, government regulation limits on the use of private property.

Law Professor and commentator Jonathan Turley notes that from a practical perspective the lawsuit, may be a bust for Citadel, even if they were to prevail:

In the end, San Benito County Supervisor Jerry Muenzer indicated that the effort to get over a billion dollars from the county would be like . . . well … fracking water from a stone: “$1.2 billion. That’s like asking for the moon. The county will file for bankruptcy and reorganize. He’s [the Citadel attorney] not going to get anything.”

Although some readers might be astonished that electoral votes could be effectively nullified by a company receiving a verdict for estimated lost profits due to citizen concern over the ill effects of, in this case, fracking, this is not unlike the provisions in most existing and pending free trade agreements. On a global level, many such accords - such as NAFTA, CAFTA and the pending TPP accord - allow for corporations to sue for loss of alleged potential profits due to local, state, or federal environmental, labor or other laws that benefit the public good.   

When the votes are counted and public health and the earth's future are "elected" over the toxic profits of one company, shouldn't democracy prevail?

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