## Facts

- On March 16, 1978, the supertanker *Amoco Cadiz* suffered steering failure in severe weather off Brittany, France, grounded, and broke apart.
- Most of its cargo (about 220,000 tons of crude oil) spilled into coastal waters, contaminating roughly 180 miles of coastline in a major fishing and tourism region.
- France, French local governments, private businesses and individuals, and a cargo insurer sought recovery for cleanup costs, environmental and economic harm, and the value of lost oil.
- Consolidated proceedings in the Northern District of Illinois resulted in substantial damages awards to public and private claimants and to the insurer.
- The district court also awarded prejudgment interest, using the 52-week U.S. Treasury bill yield in effect immediately before judgment.
- Multiple defendants and claimants appealed, primarily disputing damages calculations and the prejudgment-interest award and rate.

## Issues

1. Whether the district court’s damages findings and methodologies for public-entity costs, private economic losses, and the insurer’s cargo claim were clearly erroneous or legally flawed.
2. Whether prejudgment interest was properly awarded under federal maritime law in these circumstances.
3. Whether selecting the 52-week U.S. Treasury bill rate immediately preceding judgment for prejudgment interest was an abuse of discretion.

## Decision

- The Seventh Circuit largely affirmed the district court’s damages awards, leaving the overall remedial structure intact.
- The court affirmed the award of prejudgment interest as consistent with admiralty’s compensation principles.
- The court held the Treasury-bill benchmark rate selected by the district court was permissible and not an abuse of discretion.
- Any modifications were limited and did not materially alter the scope of defendants’ financial responsibility.

## Legal Principles

- In admiralty, prejudgment interest is ordinarily awarded to provide full compensation; denial is reserved for exceptional circumstances grounded in equity.
- The rate for prejudgment interest in maritime cases lies within the district court’s discretion; an objective market-based benchmark such as a U.S. Treasury bill rate can be reasonable.
- Damages findings after a bench trial are reviewed for clear error; appellate courts defer to reasonable valuation methods where exact measurement is impracticable.
- In mass maritime casualty cases with complex and uncertain proof, the law permits reasonable approximation rather than mathematical precision.
- An insurer that pays a cargo loss may recover the value of the lost cargo through subrogation, subject to appropriate offsets, and may receive prejudgment interest as part of compensation.

## Conclusion

The Seventh Circuit upheld substantial oil-spill damages and confirmed that prejudgment interest is generally part of full compensation in admiralty, approving a district court’s use of a 52-week Treasury bill rate as a reasonable measure of the time value of money.


In re Oil Spill by the Amoco Cadiz Off the Coast of France on March 16, 1978, 954 F.2d 1279 (7th Cir. 1992)