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Drilling Moratorium Overturn Case Gets Weaker On Revelation Judge Feldman Sold Exxon Shares Hours Before Ruling
The drilling lobby's case to overturn the Obama moratorium on deepwater drilling just got materially weaker, as it has been revealed that Judge Martin Feldman, who had previously overturned Ken Salazar's ban calling it "capricious", sold shares of Exxon stock hours before he issued his ruling. Even though the disposed stock value is not too material, at under $15,000, and it is unclear whether the judge made a profit on the transaction, it will be more difficult for the lobby to defend their decision before the Fifth Circuit where the Obama administration has appealed Judge Feldman's ruling. Furthermore, the question of why Feldman did not recuse himself from the case will now become quite prominent. Unlike Hank Paulson, we doubt he got an ethics waiver from the US Treasury.
From the WSJ:
The federal judge who struck down the Obama administration's moratorium on deepwater drilling sold stock in Exxon Mobil Corp. on the same day he issued his ruling, according to documents released Friday.
Exxon Mobil was among the companies affected by the administration's moratorium. It used one of the 33 rigs that had operations suspended under the May 27 ban, according to Exxon spokeswoman Cynthia Bergman White.
Federal judges are required to step aside from cases that present financial conflicts, according to federal rules. U.S. District Court Judge Martin Feldman bought less than $15,000 of Exxon stock in December 2009, according to the documents.
In a June 23 letter to the committee on financial disclosure of the U.S. District Courts, Judge Feldman said that he sold his shares in Exxon Mobil at the opening of the stock market on June 22, "prior to the opening of a court hearing on the spill moratorium case."
In a statement issued late Friday afternoon, Judge Feldman's office elaborated on the earlier disclosure.
Judge Feldman "only learned about his stock ownership at 9:45 p.m. Monday the 21st and because he remembered that Exxon, who was not a party litigant in the moratorium case, nevertheless had one of the 33 rigs in the Gulf, the judge instructed his broker to sell Exxon and XTO [XTO Energy Inc.] as soon as the market opened the next morning."
Judge Feldman was told by his broker that the shares were sold at the opening of the market on June 22, several hours before "the Court made its decision," the statement said.
The legal interpretation of his action has been mixed:
Legal experts offered mixed views of Judge Feldman's disclosure.
"Under the judges' interpretation of the codes of conduct-which is the official opinion of the judiciary—as long as he divests before the decision, he's okay," said Arthur Hellman, a University of Pittsburgh law-school professor and an expert on judicial ethics.
But Charles Geyh, a professor at Indiana University's law school, said a technical reading of the rules "might lead you to conclude that the judge should have disqualified himself upfront rather than hung in there and divested later."
As for the previously discussed RIG holding, turns out the Judge sold that some time ago in 2009.
In 2008, Judge Feldman owned a stake in Transocean Ltd., the company
that owned the Deepwater Horizon rig, but the documents state that he
sold those holdings in 2009.
Altogether not a good development for the rigs, and the price of BP is reflective, as it approaches its day's lows in the upper $26 range.
h/t Brooke
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If he shorted then rebought I would be thinking "scam", but if he dumped his shares before...that's sort of like shooting himself in the head isn't it?
I agree. By selling and then issuing a favorable ruling with respect to the sold stock, I don't see the problem. This is FUD.
Yeah, I don't understand what they're even trying to accuse him of? He must have a spotless record and this is the best they can do.
Treasury? He got the ethics waiver from Goldman, silly.
this is backwards. he sold his shares for a loss before he issued a ruling. only in Obama-land does taking a loss equate to a net benefit. even if he had a gain, it was sold before the information became public. for the admin to focus on this one, given the rabid insider trading that went on last year with the financials, is a joke at best and equally insulting.
Demonize & discredit- Then logic means nothing. That is the way the new administration works.
exactly, just like Martha Stewart this judge is a guilty, and he should be made to pay, but it should not serve as a smokescreen for the truly guilty banksters behind the Fed/Treasury/Wall St/Washington superscam.
wow, a judge labeled as guilty before even a trial?
is this really where we're at?
who would want to be a judge in this country?
Sounds like the Red Queen...
Agreed.
To me, it looks like the judge was kind of woken up by the case, and was probably reminded by it of his own stock holdings, and said to himself, hell, I'm doing the right thing and selling those lame stocks before another day passes.
Now, he's an insider trader who didn't actually do any insider trading but is labeled as such because he happened to be a real person owning some stocks.
Backwards? How?
What about minimizing a loss?
A bad deal is still better than a worse deal.
Hah, so you're accusing him of taking a loss on his stocks before making a ruling that would help those stocks.
See, backwards.
Ummmmm, I doubt this judge made it by being so blinded.
He has no control over his ruling length. It can last or it can not last.
He can only ensure his ruling to improve the situation temporarily.
So if he sells before his ruling, he takes a loss for sure.
If he sells after his ruling, he might take a gain but with some consequences on his job.
If he waits enough to disconnect from his ruling effects, at that moment, if the judge is still in a position of taking a loss, big chances the loss will be worse.
So the judge could have bet on a gain just after his ruling (connection between the two moves being more difficult to handle) or he could have taken a controlled loss before his ruling vs an uncontrolled loss after his ruling.
Most powerful people in Lousiana are corrupt to some extent. It's an old school place. I wouldn't be surprised if he had even more direct connections to oil people than this.
What? Owning $15k of stocks doesn't scream "direct connections to oil." He probably drives a car, too.
He's a judge in New Orleans. That's all I'm saying. Business of all kinds is transacted with stuffed envelopes down there.
I hear you, too.
The amount of corruption kind of makes me think, if this is the best Obama's camp can dig up on this judge, well, he might be alright.
In my experience, the vast majority of people named "chet" are tax cheats and dog kickers... Just saying..
Blanket statements are soooo cool!
In my experience the vast majority of people named 'flyingtrader' are raving cynics.
I have it on good authority that you're right ;)
I fu%#!ng hate that pharse...
http://www.urbandictionary.com/define.php?term=just+sayin%27
lmao. i bet he's got a copy of animal farm in his chambers, next to his swastika......this sounds like a good one for Holder
If a judge owns a home,
Should they be allowed to rule on a condemnation case?
How about all of the Supremes in the Kelo decision.
The losers are just trying to gin up something to get a ruling they prefer.
Altogether not a good development for the rigs, and the price of BP is reflective, as it approaches its day's lows in the upper $26 range.
__
But madhatter adised me to avrage down at $44-46!
How much justice can you afford?
The obamanistas will grab at any straw and sadly the media treats it all as something legitimate to report on. This is pure bullshit. It doesn't need analysis, hearings, talking heads or anything of the sort. This is one case where the phrase "move along, nothing to see here" actually fits.
Yep! And I hear that this Judge is still beating his wife (with a wet noodle!)
big oil and banksters own the judiciary.....of course feldputz got an ethics waiver...
But did he invest in Kevin Costner's oil slick fix machine?
Does he allow drilling is shallow water depths? He should
Does he allow drilling on land? Sarah does
Since when are we letting judges and the EPA tell us wher to drill? Ready made disasters
Oh I forgot --- Obama wants a disaster ---- disasters pay his bills
And if I was Kevin I would keep a close watch on my oil slick machines they
may be ruled contraband --- for the good of the country and cap n trade
This story is much ado about nothing. You'd be hard pressed to find anyone in America with a retirement account that doesn't have exposure to Exxon stock.
Agreed. The only people who will make a big deal out of it are the anti-car, the big-oil conspiracy theorists.
i don't think big-oil qualifies as a conspiracy, it's too big for that...
It's always been this way. Every time anyone makes a good argument, claim that they are bought by the oil industry.
Bullshit - that is a typical response from a corrupt, spoiled, and complacent member of the ME-generation. Having indirect exposure through some fund and directly trading a particular instrument are two different pairs of shoes. If this judge was worth his salt he should have voluntarily excused himself.
Everything is relative and nobody is guilty - the sophists are large and in charge.
So connect the dots then.
Assuming he's guilty as charged, however, doesn't do enough still because:
What if a judge sold dollars before ruling that dollars were illegal tender? I'd go along with that, no problem, since I could've been that judge.
What if a judge who had no slaves rules that slavery is illegal?
I would NOT want to be a judge in this country.
Seems hard for this story to pickup traction. The guy did shoot himself in the foot. Why get on him if he sold his oil stock right before he issued a ruling favoring them. Bad judgment though messing around with oil stock when he was involved.
If I buy 1 share for every listed company, can I then be recused from every business case involving jury duty?
This Alinsky cat, related to Josef Goebbels?
IF oil is an appreciating asset, then counterintuitively there's no rush to drill in the GOM. It gets more efficient and prob extraction methods improve. In any case, even BO doesn't want a spike in oil prices.
"In any case, even BO doesn't want a spike in oil prices."
I disagree. Everything Obama does begs for spikes in energy prices. If BHO doesn't want spikes, virtually every interest group trying to pull his puppet strings wants them. It is difficult to get people to invest in Chinese Solars when gas is 2.00/gallon and your coal generated electric bill only runs $50/month.
BP NEW LOW
Today 5d 1m 3m 1y more Last Price 26.79 Change $ 0.23 Change % 0.85% Tick Bid 26.78 Bid Size 4000 Ask 26.79 Ask Size 3900 Open 27.65 High 28.03 Low 26.75 Prev Close 27.02 Last Trade 3:33 Volume 60.85 m 52 Wk Hi 62.38 52 Wk Low 26.83 Market Cap 83.87 b Ex-Div Date N/A Div Rate N/A Yield N/A Shares 3,130,726,833 EPS (TTM) 6.36 PE Ratio 4.30 close Exchange Information Listed On New York Stock Exchange (NYE) Exchange NYEThe US supposedly unique experiment is such a failure. When you think they sacrificed millions of Indian lifes for this result. I totally understand why Indians are so desesperate. WOooo, seeing the result now must pretty hard to take.
Whatever, never waste a good opportunity, Mr. Judge.
Douche. Oh, and if you weren't sure what I meant,,, "You are an utter douche." Kindly go slip face first in a puddle of AIDS.
Hey, Obama, I know you're a Socialist and all, but let me explain something to you. The judge sold XOM shares before his ruling; a ruling that one would anticipate would have been viewed as positive for the oil stocks. So he theoretically bought high and sold low, in advance of the information coming out and driving his XOM into a profit.
Why does the judge not care that BP has destroyed the Gulf of Mexico?
Because he's (Sotero and this clown judge, among others) part of the capitalist legal system, he serves those interests. The biosphere and our planet must take a backseat to corporate accumulation.
No matter the cost. No matter who dies.
this is more bullshit because everyone knows the judge's decision is on solid legal footing.
Of course, because corporate tyrannies MUST be allowed to plunder the planet without restriction.
It's all good, thanks to the 'law, even if you destroy the Gulf of Mexico.
I mean - who is NOT fucking corrupt these days? For fucks sake - we need a popular uprising in this country. I'm sick of this shit - on a fucking daily basis we see news like this. And nobody ever fucking goes to prison.
FUCK!!!
(sorry, I had to vent a little)
He sold them BEFORE the ruling, dumbass...a FAVORABLE ruling, no less.
And it was a lousy 15k...who gives a shit?
The legal decision was SOUND anyhow. The government is NOT empowered to SHUT an entire industry down on account of one mistake by one participant.
"One mistake" is the destruction of the Gulf of Mexico.
How many worthless Fed IOUs will it take to replace the Gulf of Mexico with a new one, trav?
Typical capitalist BS: socialize the costs - in this case the destruction of the Gulf and the destruction of the economic order throughout the southeast - while devouring plunder and grilled baby sandwiches.
According to you, the plunderers are sacrosanct. How f-ing sick is that??
That's capitalism for ya.
You have to understand. The ranters are looking at the potential gain on a $15,000 holding (that had been sold) as a huge amount as it represents more than what their parents send them for allowances. As you note, there was cetainly good legal grounds for the ruling.
Laughable and pathetic.
Geez, its not like he went long...!
Definitely much ado about nothing! Even the positive decision (for XOM) did not move the stock higher on June 22. In fact, the judge could have bought it back that afternoon for a tidy two percent gain for the day! Of course, then he would really have attracted the attention of Mr. Holder.
http://ir.exxonmobil.com/phoenix.zhtml?c=115024&p=irol-stockLookup&t=HistQuote&control_firstdatereturned=
Did he donate any money to environmental causes?
Did someone say Hank Paulson?
Congressman Stearns Questions Hank Paulson How Do You Have Any Credibility:http://www.youtube.com/watch?v=c4VnwSM5LEY
BP has been a dirtbag company for many years and it now has brought all the other companies that have not cut corners at every opportunity to the point of being painted with the same brush by the anti-capitalist pinheads. Mining is the basis for any prosperous society. Cut it off and you will go back to nasty, brutish, and short.
"What the hell have we done to deserve this?"
— BP CEO Tony Hayward, in reported remarks to BP executives following the Macando well explosion
We are now 70 days into the Gulf oil spill crisis and the disturbing details keep rolling in. I keep going back to that question posed by Mr. Hayward shortly after the explosion.
So here's my answer...
Dear Mr. Hayward,
Enclosed is my reply to your question, What the hell have we done to deserve this?
If you wish to refute or respond to any part of it, please email me at adam.sharp@energyandcapital.com.
Without further delay, here is precisely what your company has done to deserve this.
You cut costs and placed profits over safety.
This is the big one. The Wall Street Journal recently reported that your firm frequently used a cheaper well design, known as "long-string." The more expensive option — a "liners" design — offers more protection against a gas blowout like the one experienced on the Deepwater Horizon.
In this case, the $7 million or so you "saved" by using the cheaper design may end up costing you $100 billion+.
Also, the New York Times reports that BP's business model is based on acquiring smaller firms, then slashing costs by skimping on safety and experienced personnel:
Mr. Browne had built BP by taking over other oil companies, like Amoco in 1998, and then ruthlessly cutting costs, often firing the acquired company’s most experienced engineers. Taking shortcuts was ingrained in the company’s culture, and everyone in the oil business knew it.
Apparently the Macando well was behind schedule; it appears that the process was rushed to make up for lost time. Consider the WSJ editorial by Terry Barr, President of Samson Oil and Gas.
Mr. Barr wrote an extremely detailed piece that rips BP's operations to pieces. Here's the conclusion — though I do recommend reading the whole article:
This well failed its casing integrity test and nothing was done. The data collected during a critical operation to monitor hydrocarbon inflow was ignored and nothing was done. This spill is about human failure and it is time BP put its hand up and admitted that.
WSJ reader Donald Ferrel summed it up well in the comment section:
By relying on the blow out preventer, BP did the equivalent of jumping out of an airplane knowing that the main chute was faulty and relying on the back up chute. No responsible person one would do that. BP's backup didn't open.
Every step of the way, it seems your managers placed cost savings and expediency over safety and responsibility.
Secondly, you downplayed the size of the spill.
Since the explosion, your organization has done much to make things worse.
First and foremost is underestimating the size of the spill. This undermined response efforts and cost responders desperately needed time.
The Deepwater Horizon exploded on April 20th. As far back as April 29th, government agencies were using flow rate estimates of 64k-110k barrels per day. The image below is from a video released by NOAA on the spill response.
This image is from 04/30/2010 — yes, just 10 days after the Deepwater Horizon sank.
Note: 5k bpd was the official number at that time.*
*red MS paint edits are editor's
Any suggestion that BP did not know about these higher estimates is suspect. They were the only ones with access to HD video from the leak itself, until government pressure forced them to share...
And their own application to the MMS showed a "worst-case scenario" of 125,000 barrels per day escaping from the well.
Note: I am not placing any blame on the scientists at NOAA. These guys are working around the clock and doing a critically important job, for which they deserve our thanks.
Unfortunately, I suspect there is a political nightmare unfolding around them as BP and politicians fling blame and marching orders around haphazardly.
And so concludes my response to Mr. Hayward's ridiculous question.
To be fair, it is unclear how much responsibility Hayward himself bears for the accident. He took over leadership of BP in May 2007, just over three years ago. While that is a significant amount of time, changing a corporate culture can be difficult.
Hopefully we will learn how hard he was truly trying.
Until next time,
Adam Sharp
Analyst, Wealth Daily
P.S. My colleague Keith Kohl has been highlighting onshore drilling opportunities for years. His latest report explains how to profit from the pullback in offshore drilling. It's a good read, and the picks look interesting.
Editor's Note: I should disclaim that I currently short BP stock. Also, sources used in this story include NOAA whiteboard photo, Free Republic, and WSJ: BP relied on "Cheaper Wells."
Comment on / Rate this Article
A Judge on the take ???? can't be !!!!!
Well I guess when Media Matters and the like realized that their attempted character assassination using his 2008 financial records was a retarded failure, they had to keep throwing shit at the walls hoping something will eventually stick. Maybe I'm giving the WSJ too much credit, but I would have thought that they knew better than this. To anyone with half a brain and an ounce of common sense, this is a complete non-story.
Yes indeed: this poor, bought off, crooked judge should be completely free to exonerate a corporate tyranny like BP from any liability here, in spite of the fact that BP ruined the Gulf of Mexico and cannot repay the debt it owes to the planet.
Some disgusting shit, that capitalism. . .
Time for BP to go, along with any circus-clown judges who want to run interference for this, the most genocidal of all corporations.
Hahahahhaah
And how did his decision cap their liability? It had nothing to do with that.
Bought off by who? Crooked how? Don't worry, I'll wait.
And exonerate BP? Really?
I see what the problem is here. You have absolutely no idea what's going on and no fucking clue what you're talking about.
But do go on with your callow emotional hyperbole. I'm gonna go make some more popcorn so I can thoroughly enjoy watching that vacuous mass sitting above your shoulders struggle to form anything close to what could be considered a rational or logical thought.