"UPDATE: Judge who ruled against moratorium owned stock in Exxon, other drilling companies"
The federal judge who presided over a challenge to the Obama administration’s six-month moratorium on deepwater oil drilling simultaneously owned stock in an oil company affected by the ban, according to a financial disclosure statement released Friday.U.S. District Judge Martin L.C. Feldman sold the stock in Exxon Mobil 14 days after the case was filed in New Orleans by a group of oil service firms — and less than five hours before he struck down the moratorium.
U.S. law requires judges to withdraw from any lawsuit in which they have a direct financial interest, however small. Rules also forbid them from hearing cases in which their impartiality might reasonably be questioned or in which their financial interests would likely be substantially affected.
The judicial canons require that judges be aware of their investments. Judicial ethicists said that, had he been aware of his holdings, Feldman should have disclosed the ownership or recused himself at the case’s outset if he thought it posed a conflict or raised questions about his impartiality. The court docket indicates that Feldman signed several orders before the sale.
“I’ve never heard of a situation like this,” said Jeffrey M. Shaman, a judicial ethics specialist and law professor at DePaul University.
The judge may have thought the stock did not create a substantial conflict, legal analysts said, but the fact that he apparently felt compelled to sell the stock and disclose it could be seen as indicating otherwise.
“The fact he sold his holdings in Exxon does not somehow cleanse what he did in the case,” Shaman said. “If he made [earlier] rulings in the case, those rulings are subject to question.”
Provident Energy Trust
Peabody Energy Corp
Atlas Energy Resources
EV Energy Partners
Basic Energy Services
Petrohawk Energy Corp
Boardwalk Pipeline Partnership
Valero Energy Corp
Noble Corp (a leading offshore drilling company)
Judge Feldman’s energy-investment income suggests a bias in favor of sustaining the fossil fuel energy industry. Recall that the question that Feldman was asked to rule on was whether Obama’s drilling moratorium inflicts an undue harm to the public interest.
Feldman ruled that the suspension of deepwater drilling “simply cannot justify the immeasurable effect on the plaintiffs, the local economy, the Gulf region, and the critical present-day aspect of the availability of domestic energy in this country.” The energy companies who filed suit against the administration arguing the importance of oil drilling for the economy probably didn’t have to do much to convince Feldman.
The judge should have withdrawn from the case. The ruling should be overturned.