Suppose that you operate an energy company and are considering offshore drilling. You have tentative agreements to purchase offshore rigs, cranes, and barges for transport of oil. Among the many regulations that blanket the energy industry, one of them is the American Petroleum Institute, or API, recommended regulations.
American Petroleum Institute
The API is a trade organization that represents over 650 US corporations that are involved in the petroleum industry. Its stated purpose is “to influence public policy in support of a strong, viable U.S. oil and natural gas industry.” To that end, it provides lobbying services on behalf of its members, creates curricula to teach school-aged children about the oil and gas industry, and creates standards within the industry.
The API consists of committees and subcommittees that discuss and debate various issues related to energy in general and petroleum in particular. Eventually, those subcommittees and then larger committees hold votes to pass various standards, including commercial standards within the industry. These discussions include safety issues and how safety precautions should be integrated into the workflow and lifecycle of petroleum extraction and production.
While the API is not an official government body and is not officially sanctioned by the US or any state government, its word and directives are often considered standards within the industry.
As mentioned, the API provides recommendations for safety precautions within the oil extraction industry. For instance, API safety standards state that the person operating the crane during an offshore drilling is in charge of all maneuvers performed by the crane. The crane operator, according to API standards, is also in charge of rigging. According to the API, when rigging, the crane operator must act in concert with a flagman, who is someone who uses flags to provide signals.
Suppose someone who works at an offshore oil platform is hurt as a result of the crane. He comes to his lawyer and discusses a possible lawsuit against the oil company for negligence. Because the injury occurred out in the ocean, the case would go to a federal court and the case would be argued in front of a federal jury.
To prove negligence, one element is that the plaintiff demonstrates that the defendant breached a duty of care to the plaintiff. It is possible that the employer oil company complied with federal safety regulations, particularly the Occupational Safety & Health Administration, better known as OSHA, requirements. As such, it may be difficult, by those means, to say that the defendant oil company breached its duty of care to the plaintiff when the defendant oil company was compliant with federal regulations.
Nonetheless, the plaintiff may have a case that the oil company breached its duty of care to the plaintiff because the oil company did not comply with API safety standards, depending on the facts of the case. While those standards may not a legal requirement incumbent on the oil company, it may nevertheless demonstrate a breach of duty of care with respect to the defendant oil company.
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