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01/19/97
Insurer has paid $3.4 million in damages so far
By ELIZABETH ABBOTT
Journal-Bulletin Staff Writer
Lobstermen, fishermen, charter boat operators.
Motel operators, restaurateurs, seafood processors.
Deckhands, shellfishermen, bait shop owners.
These are just some of the people who have filed claims against Eklof Marine and its insurers since the oil barge North Cape went aground last January, spilling 828,000 gallons of home heating oil into Block Island Sound.
Insurance adjustors for Eklof have been reviewing the claims as they come in. So far, the company has paid $3.4 million to those who could document that the oil spill disrupted their livelihoods, said Deming E. Sherman, Eklof's lawyer in Rhode Island.
Some kind of proof is needed, but people who file claims do not need lawyers, and the process is not sophisticated, Sherman said.
"If people have legitimate claims, they are still free to file them and have them assessed," said Sherman, noting that the deadline for filing claims is March 28.
The claims period remains open despite the fact that Eklof and its related companies got a court order in July limiting their liability, Sherman said.
The July 19 order, approved by a U.S. District Court judge in New York, also said that any future claims and litigation arising from the oil spill had to be heard in New York, not Rhode Island.
Sherman said Eklof filed the motion just to exercise its legal rights, not to wiggle out of paying oil spill damages. He noted the company had already paid $13 million in spill-related costs, $3 million more than is covered by the company's primary insurer.
Eklof is insured for $10 million by the Water Quality Insurance Syndicate in New York. It is insured for an additional $500 million by an international group called West of England Ship Owners Mutual Protection and Indemnity Association.
"We're not running away from the problem," he said.
But Rhode Island is not taking any chances. Atty. Gen. Jeffrey B. Pine has asked that the July order limiting Eklof's liability be vacated and that the entire case be moved to Rhode Island. A decision on the state's request is pending.
Not only would it be very inconvenient for Rhode Islanders to travel to New York, Pine said, but the case should be heard in Rhode Island because the accident took place here -- and "they're our resources."
If the case stays in New York, the state can still pursue its claim against Eklof, according to Michael Rubin, chief of Pine's environmental unit. The state's claim is separate and apart from the claims individuals and businesses have been filing against the company.
The state will seek compensation for such things as lost revenue to the state, direct damage to state property and a category Rubin called the "biggie" -- damage to the state's natural resources.
"In essence, we're representing the planet," he said.
The amount of the state's damages is still being tallied.
The U.S. attorney's office also might sue Eklof in connection with the oil spill, according to Tom Connell, a spokesman for U.S. Attorney Sheldon Whitehouse.
"There are both civil and criminal remedies available to the U.S. attorney. We are conducting a thorough investigation and will pursue either or both as best addresses the situation," Connell said.
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