WASHINGTON: The Supreme Court on Monday agreed to decide whether Exxon Mobil Corp. should pay $2.5 billion, or \1.74 billion in punitive damages in connection with the huge Exxon Valdez oil spill that fouled more than 1,200 miles, or 1,930 kilometers of Alaskan coastline in 1989.

The high court stepped into the long-running battle over the damages that Exxon Mobil owes in the spillage of 11 million gallons of oil into Alaskas Prince William Sound, the worst oil spill in U.S. history.

The Exxon Valdez supertanker had run aground on a reef. A federal appeals court already had cut in half the $5 billion at the current exchange rate) in damages awarded by a jury in 1994.

The justices said they would consider whether the company should have to pay any punitive damages at all. If the court decides some money is due, Exxon is arguing that $2.5 billion is excessive under laws governing shipping and prior high court decisions limiting punitive damages.

The damages were, by far, the largest ever approved by federal appeals judges, the company said in its brief to the court.

The case probably will be heard in the spring. The courts last ruling on punitive damages, in February, set aside a nearly $80 million judgment against Altria Group Inc.s Philip Morris USA. The money was awarded to the widow of a smoker in Oregon.

Justice Samuel Alito, who owns between $100,000 and $250,000 in Exxon stock, recused himself from the case.

Exxon said it already has paid $3.4 billion in clean-up costs and other penalties resulting from the oil spill, which killed hundreds of thousands of seabirds and marine animals.

“This case has never been about compensating people for actual damages,” company spokesman Tony Cudmore said in a statement. “Rather it is about whether further punishment is warranted…We do not believe any punitive damages are warranted in this case.”

Lawyers for the plaintiffs, some of whom are deceased, said the damages award is “barely more than three weeks of Exxons net profits.” The plaintiffs still living include about 33,000 commercial fishermen, cannery workers, landowners, Native Alaskans, local governments and businesses.

The Irving, Texas-based oil company marshaled more than a dozen organizations ranging from groups of shippers to the U.S. Chamber of Commerce, to support its bid for Supreme Court review.

The company argued it should not be held responsible for the mistakes of the ships captain, Captain Joseph Hazelwood, who violated clear company rules when the Exxon Valdez ran aground with 53 million gallons of crude oil in its hold on March 23, 1989.

The plaintiffs said Exxon knew Hazelwood had sought treatment for drinking, but had begun drinking again. “Exxon placed a relapsed alcoholic, who it knew was drinking aboard its ships, in command of an enormous vessel carrying toxic cargo across treacherous and resource-rich waters,” they said.

The company has been battling the judgment for over a decade. The company has managed to get the award cut in half from the original $5 billion awarded in 1994 by an Anchorage jury in the class-action suit.

The 9th U.S. Circuit Court of Appeals reduced the punitive damages because, in part, the company tried to clean up the spill and didnt spill oil from the tanker Exxon Valdez deliberately.

The disaster prompted Congress in 1990 to pass a law banning single-hulled tankers like the Valdez from domestic waters by 2015.

Exxon Mobil shares were up $1.61, or about 2 percent, to $93.82 in morning trading.

AS THE Ayatollah Khomeini’s wily right-hand man and president for eight years, Hashemi Rafsanjani is known as a “pillar of the revolution” and a “regime stalwart”.

So he makes an unlikely newcomer on the Iran’s long list of banned authors.

According to Iranian news agencies, publication of the latest volume of Mr Rafsanjani’s memoirs has been suspended following uproar from ultra-conservatives allied to his chief rival, Iran’s firebrand president, Mahmoud Ahmadinejad.

The controversy was ignited by a claim in the book, Towards Destiny, that the late Ayatollah, father of the 1979 revolution, wanted to drop the regime’s slogan, “Death to America”, which is still widely chanted at Friday prayers.

The spat highlights intense power play in Tehran ahead of a key two-day meeting that begins today to appoint a new speaker of a powerful clerical body following the death of its veteran leader in July.

Mr Rafsanjani, a pragmatist who supports better ties with Washington, trounced hardliners in the battle for the Tehran seat on the Assembly of Experts in December and is now the favourite to become the panel’s new speaker.

The 86-member clerical conclave has the power to reprimand or even dismiss the supreme leader and leadership of the body would give Mr Rafsanjani a strong lever to challenge Ayatollah Khamenei.

In recent months the hardline press has campaigned against Mr Rafsanjani, and the attacks on his memoirs are seen as part of that attempt to tarnish his reputation ahead of this week’s assembly election.

In his book, Mr Rafsanjani recalls being approached in July 1984 by a deputy who proposed dropping the twin slogans, “Death to America” and “Death to the Soviet Union”. Mr Rafsanjani wrote: “I said we have decided in principle. The Imam [Khomeini] has agreed, but we are waiting for a chance.”

Nevertheless, the slogan was kept and Mr Rafsanjani has been accused of misinterpreting what Ayatollah Khomeini said and distorting his legacy by suggesting he was prepared to ditch the ritual denunciation of the “Great Satan”.

An editorial in the hardline Kayhan newspaper, which is close to Ayatollah Ali Khamenei, Iran’s supreme leader, insisted: “A quick look at the departed Imam’s [Khomeini’s] points of view, speeches, messages, letters, orders and guidelines… does not leave the slightest doubt that the great man considered enmity and disagreement with America to be the main strategic focus of the Islamic system.”

It was unthinkable that Ayatollah Khomeini would ever regard the “Death to America” slogan, a cornerstone of revolutionary rhetoric, as expendable, Kayhan thundered.

Iran’s ministry of culture denied that Towards Destiny had been banned, but news agencies quoted ministry officials saying further publication and distribution had been suspended. Senior ayatollahs had to check the contents of the memoir, which had been published without official permits from bodies that verify whether quotations attributed to Ayatollah Khomeini are accurate, the reports said.

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The following is an excerpt from the author’s October, 2007 report, The Next Crash.

Wall Street and Main Street will remember and chronicle the 1990s for a variety of reasons: the emergence of the Internet, the dot.com boom and bubble, excessive valuations, and eventually a bear market. It was also a time of reform, as new rules, regulations, and practices led to what we might term the deregulation of financial services.

Somewhat like what had happened in telecommunications and the airlines, the landscape emerged far different than what had existed. Our focus and interest is on the equity markets, but the revolution on Wall Street has affected other markets as they became significantly larger, expanded their products, and introduced new measures and techniques. The new measures include: Regulation FD; Sarbanes Oxley; decimalization; extended trading hours, crossing networks; electronic, online trading; and ETFs and other instruments.

These measures were undertaken under the guise of protecting the individual investor from biased or prejudiced research, unsavory operators, scrupulous corporate officers, and accountants whose alleged objective was not to conform to “standard accounting practices” but rather to “what do you want it to be?” We were concerned at the time of their introduction that many of the proposals and measures were political, expedient reactions to real, but isolated or limited problems or circumstances. Disenfranchising the Average

Our concern today is two-fold. First, the markets of the first decade of the 21st century are prone to systemic failure as a result of technological innovations and utilization, rapid growth of sophisticated, but not necessarily vetted, instruments, and other changes in the wide world of finance. We will readily note that this is not solely a function of Wall Street, but also reflects the quickened pace of the overall environment, lower cost of technology in all its forms, the continuing demise of the manufacturing/operating economy to one of finance and service, and so forth.

Secondly, we believe that the various structural reforms of the 1990s have not achieved the desired effect with regard to the individual and have in fact disenfranchised, even more so than before, the individual who might work 50 hours a week, have 2.5 children, and cut his lawn on weekends. Instead they have provided the affluent and institutional investor with even more of an opportunity to enrich himself.

On the first point, we’re concerned about the large number of system failures and computer glitches that appear to receive little or cursory attention. For example, on Feb. 27, 2007, there was a 230-point drop in the Dow Jones industrial average because of “an error in the calculation.” Again, on July 26, 2007, the Dow average was not calculated from 2:55 p.m. to 3:08 p.m. Eastern Time because the system was “overloaded.” It should be disturbing that these events occur, and the implicit hope that this will not happen during a significant crisis or period of stress is naпve. Derivatives and Other Instruments

We are not alarmists and we are not predicting a market meltdown. Rather we are concerned about the potential for a major disruption, which would then be the subject of analysis, legislative hearings, and finger pointing.

An issue that could lead to another crash is that of derivatives and other instruments. We are admittedly negative about the subject in part because of our experience in 1994. At the end of 1993, our Wall Street Week picks included a put on the Hang Seng Index. The Hang Seng complied with our hopes and declined 30% that year but our put (in the form of a warrant; ETFs were unavailable) also declined 30%.

Derivatives concern us as several examples of seemingly innocuous instruments have had major impacts.