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 judge doesn't know whether there was a profit or a loss on the sale."
The Obama administration had said it will appeal Judge Feldman's ruling to the Fifth Circuit Court of Appeals.
Spokesmen for the White House, U.S. Department of Interior and U.S. Department of Justice declined to comment.
Environmental groups critical of Judge Feldman's decision have raised questions about his investments in the energy sector disclosed in prior filings.
"I sure wish these disclosures had been made public sooner. It certainly complicates our legal position in this case. ...," said Kieran Suckling, policy director for the Center for Biological Diversity, which is one of the groups that intervened in the case to defend the moratorium.
Doug Kendall, president of the government watchdog group Constitutional Accountability Center, questioned whether Feldman's stake in Exxon Mobil would disqualify the judge, given the size of the company and the likelihood that its stock wouldn't be affected by the ruling.
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 of the end of 2009, Judge Feldman does not appear to have owned stock in any other company using rigs affected by the moratorium, according to a review of his holdings and a list of such companies provided by staff of Sen. Robert Menendez, a Democrat from New Jersey who sits on the Senate's energy and natural-resources committee.
As of the end of last year, Judge Feldman did own stock in other energy companies.
Among them are Allis-Chalmers Energy Inc., an oilfield-services company based in Houston.
Allis-Chalmers said in a quarterly filing that its rental-services unit has been "very dependent on drilling activity in the Gulf of Mexico."
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.
