A judge has thrown out a class-action lawsuit filed by several pension plans against fossil-fuel company Plains All American Pipeline for an oil spill that allegedly harmed both investors and the environment.
Plaintiffs, led by the $11.4 billion IAM National Pension Fund, Washington, include the $3 billion Detroit Police & Fire Retirement System; $1.8 billion Jacksonville (Fla.) Police and Fire Pension Fund; and the $287 million Warren (Mich.) City Police and Fire Retirement System.
The $7.8 billion Rhode Island Employees' Retirement System, Providence, is also a plaintiff, confirmed Evan England, spokesman for state Treasurer Seth Magaziner, who oversees the Rhode Island State Investment Commission, Providence.
Documents filed with the U.S. District Court in Houston said plaintiffs alleged the oil and gas pipeline company “falsely claimed to have a comprehensive, effective environmental and regulatory compliance program to prevent oil spills and, if they occurred, quickly remediate the effects.”
The plaintiffs allege that Plains' compliance program “was close to non-existent” and that the company “repeatedly violated regulatory mandates.” Plains allegedly deceived the public about its compliance program with falsehoods that inflated the price of the company's securities, according to the lawsuit.
“The lack of an effective compliance program was dramatically exposed when a Plains pipeline in Santa Barbara County, Calif., burst and thousands of barrels of oil spilled,” documents said. “Plains securities lost significant value in the aftermath.”
Chief U.S. District Judge Lee H. Rosenthal dismissed such claims, stating in court documents that none of the statements that Plains made in SEC filings “are actionably false or misleading.”
Plaintiffs have until May 15 to amend their complaint.
Plains spokesman Brad Leone could not be reached for comment by press time.