Did Gov. Christie Know That The State’s Exxon Hand Was Legally Weak?

If Christie Knew, Why Would He Defend the $225 Million Settlement As Aggressive?

Did Christie Know DEP Was 0 for 3 – That DEP Had Lost The Only 3 NRD Court Cases It Litigated?

Did Christie Know DEP failed to honor Brad Campbell’s 2004 Lawsuit Settlement to propose NRD regulations?

Did Christie know that his own DEP transition Report recommended that DEP adopt NRD regulations?

If Christie Knew All This, Why Didn’t He Just Blame The DEP Bureaucracy, Corzine, & Campbell?

It’s never Christie’s fault! Source: Star Ledger

[Update: 4/6/15 – Joel Rose of WNYC All Things Considered gets the story right:

Picco says state officials have never written detailed regulations for how to assess natural resource damages — a point some environmentalists concede has hurt the state in court, and in settlement negotiations.

Bill Wolfe heads the New Jersey chapter of Public Employees for Environmental Responsibility.

“The polluter knows that he’s gotta pay something,” he says. “But they know that push comes to shove, they have a good likelihood of winning in court. So they’ve got a stronger hand than the state. And that negotiation results in the three cents on the dollar we’ve seen in the Exxon deal.” ~~~ end update]

Tomorrow, the Christie Administration’s controversial $225 million “Natural Resource Damage” (NRD) settlement with Exxon will be published for a 30 day public comment period.

The first look at the terms of the settlement is sure to spark another new round of media coverage and criticism.

Going into that dynamic, I have a very basic political question: How did Gov. Christie’s PR machine bungle this so badly?

In my experience in government, the prime imperative was “No Surprises” and “Never put the front Office in jeopardy or embarrass the Governor”.

That would mean that the Gov. would get a heads up from both the DEP Commissioner and Attorney General that the Exxon settlement was coming and that it would be controversial.

That heads up to the Governor would include a legal and policy briefing memo on the issues, as well as media talking points.

I’ve done this work before myself and been chastised for failure to do it properly, so I know exactly how this game is played.

Did Gov. Christie get that briefing? If he did, was in an honest briefing?

And if Christie did get this briefing and the DEP and the AG fully disclosed the State’s legal vulnerabilities – disclosed in detail for the first time in Friday’s NJ Law Journal article – why did  Gov. Christie ignore it?

Even worse, Christie is a former prosecutor. He understands legal risk.

He had to know that  the much spun fact that Exxon was already found by the Court to be “liable” – under the strict liability standard in NJ Spill Act – is of no significance – NONE – at all with respect to the issue of whether the State’s $8.9 billion NRD claim would be upheld.

If Christie knew that the State had a weak legal hand, why would he take weeks – weeks! – of scathing  criticism by the national and NJ media and a pounding by NJ Democrats – particularly at a sensitive time that he is seeking the Republican 2016 nomination?

There are certain things that Gov. Christie is very good at: anticipating and getting out in front of controversial issues, framing them in his own terms, and blaming others for failures or things that explode in the media.

So, how did his Administration get their PR and response so wrong on the Exxon NRD Settlement?

The narrative up until Friday’s NJLJ story was framed by Brad Campbell’s Op-Ed:

Mr. Christie’s chief counsel inserted himself into the case, elbowed aside the attorney general and career employees who had developed and prosecuted the litigation, and cut the deal favorable to Exxon.

Governor Christie was blindsided by this and responded by a lame personal attack on Campbell as a “failed former DEP Commissioner”.

If Christie was aware of the Exxon Settlement and had been briefed on the issues, why didn’t he just blame the bureaucrats at DEP, including the Corzine DEP, for failing to do their job, honor the 2004 settlement in the SEED case to adopt regulations?

Why didn’t he attack Brad Campbell himself as the DEP Commissioner who made and failed to honor the SEED settlement?

If Christie were aware of the Exxon legal vulnerabilities and the DEP’s 0 of 3 record in litigation, as a former prosecutor, why didn’t Christie just say he was dealt a weak hand by the Corzine administration and had to settle or lose it all?

Why would Christie defend the settlement and stake his own reputation on it?

Why were Christie’s responses to withering criticism, including by the NY Times, so substantively weak?

Why wouldn’t the Gov. use the legal vulnerability created by DEP’s failure to adopt regulations as an excuse?

I can only conclude that the Gov. could not have known about the State’s legal vulnerabilities that were laid out in Friday’s NJ Law Journal story.

And for that failure to provide a timely and honest heads up briefing on Exxon NRD, heads should role at DEP and the AG’s Office for violating two prime imperatives: “No surprises”  and “Never embarrass the Governor”

Of course, another explanation could be that the Gov. was briefed but was just too busy campaigning to govern effectively.

[Update: The New York Times wrote an in depth story based on high level anonymous sources, that talked about the history on negotiations with Exxon.

This paragraph is revealing and supports what I’ve been saying about the “quiet dance” for pennies o the dollar:

Mr. Wells [Exxon’s lawyer] said in the meeting that he considered the $325 million offer “outrageous,” a person with knowledge of the discussions recalled. Mr. Wells largely repeated the arguments he had made before and said the company did not feel it was being treated fairly or consistently with how other major corporations had been treated in such cases.

Exxon wanted – and ultimately got – pennies on the dollar too.  ~~~ end update.]