DAMAGES SOUGHT IN PERSIAN GULF CLEANUP

Midland, Tex., firms are seeking $2.5 billion in actual and punitive damages from companies involved in cleanup of the Persian Gulf oil spill. Clyde and Diantha Veltmann and Veltmann Corp" doing business as Veltmann Engineering and Veltmann Environmental, are plaintiffs. Their suit also asks for a temporary injunction to stop cleanup teams from using a proprietary process claimed by Veltmann to recover oil released by Iraq into the gulf.

July 15, 1991

4 min read

Midland, Tex., firms are seeking $2.5 billion in actual and punitive damages from companies involved in cleanup of the Persian Gulf oil spill.

Clyde and Diantha Veltmann and Veltmann Corp" doing business as Veltmann Engineering and Veltmann Environmental, are plaintiffs.

Their suit also asks for a temporary injunction to stop cleanup teams from using a proprietary process claimed by Veltmann to recover oil released by Iraq into the gulf.

Named as defendants in the suit are Crowley Maritime Corp., Aramco Services Co., Bechtel Corp., O'Brien Oil Pollution Services (OOPS), Martech U.S.A., W.R.J. Inc., and A.M.T.E. Inc.

Defendants reached by Oil & Gas Journal denied any wrongdoing.

The Meteorological and Environmental Protection Agency (MEPA) in Saudi Arabia, responsible for the cleanup, was not named as a defendant in the suit.

MEPA hired Bechtel in early February to help coordinate the cleanup and named Aramco Services and Crowley general contractors.

One defendant said Crowley was responsible for hiring subcontractors. All companies named in the suit were not privy to all proposals made by companies seeking contracts, he said.

Companies wanting to help with the cleanup made presentations to either Bechtel or Crowley. Depending on communication patterns in a given week, "they might have gotten in to see MEPA directly," he said.

However, all proposals were entered into a Bechtel data base. At least one of Veltmann's ideas is in the data base, a Bechtel official said.

VELTMANN SUIT

Veltmann is seeking actual damages of $500 million and punitive and exemplary damages of $2 billion.

A petition filed July 2 in Harris County, Tex., district court alleges the defendants conspired to steal Veltmann's method of quickly cleaning up large volumes of oil from shallow coastal water by fraudulently inducing the company to reveal its trade secrets, then wrongfully converting the secret process to their use.

Among causes for damages sought, the suit alleges violation of trade secrets, fraud, interference with existing and prospective contracts and business relationships, breach of contract, breach of fiduciary duty, misappropriation of personal property, and violation of Texas antitrust laws.

Clyde Veltmann contends he agreed to disclose his technology at eight meetings with the defendants on condition they would not use it without his consent or unless his company received a contract to join the cleanup.

After the government of Saudi Arabia named Saudi Aramco and Crowley Maritime general contractors for the cleanup, Crowley offered Veltmann a subcontractor role to clean up shallow beach areas in exchange for further technological disclosures, the suit contends. Although Veltmann again revealed secret technology, Crowley broke repeated promises to hire the company and, instead, is using Veltmann's process to clean up the spill, the suit alleges.

DEFENDANTS' DENIALS

Officials of companies named as defendants said the need to react quickly to the spill prevented them from trying unfamiliar technology in the cleanup.

New ideas with possible merit couldn't be tried because of delays in moving equipment and materials into Saudi ports "already swamped with war materials and military cargo," one defendant said.

A Bechtel official said Veltmann's suit was "frivolous and without merit." He said MEPA asked Bechtel to help with the cleanup because of its 45 year business relationship with the Saudi government.

"We neither sought nor played the role of a cleanup contractor. Our expertise is in controls and management," he said.

Oil removal was carried out by other companies.

"As far as Bechtel knows, no technology was used (in the cleanup) that was not wholly conventional, preexisting, and could be considered in any way to infringe on Mr. Veltmann's ideas," Bechtel said. "We absolutely reject the notion that any of Mr. Veltmann's ideas were used at all."

Jim O'Brien, OOPS president, said he was contracted to help with the cleanup by a group of Saudi petrochemical companies not named in the suit. "I had no contact with MEPA or Saudi Aramco," O'Brien said. He said all oil recovery methods OOPS used in the Persian Gulf were conventional methods his company has used in the Gulf of Mexico.

Crowley officials said, "Our people are totally unaware of what Mr. Veltmann is talking about."

A hearing was scheduled this week in Houston on Veltmann's request for an injunction to prevent use in the Persian Gulf of his secret oil recovery technology. But an official of a defendant said an injunction, if granted, likely would have little effect because most oil recovery offshore has been completed.

"As far as we know, there's nothing to enjoin because the activities he's talking about aren't going on at the moment," he said.

Also, he contended, because defendants don't know what technology Veltmann alleges they have used illegally, they wouldn't know what to stop using.