BP Tries to Overturn Gulf Oil Spill Settlement
Is Anyone Surprised?
By Dr Stuart Jeanne Bramhall
BP’s
massive 2010 Gulf oil spill virtually destroyed the Gulf of Mexico
economy. Fisheries, tourist-related enterprises, and the businesses
dependent on them went belly-up in the hundreds of thousands. Yet as
business owners quickly found, the only way they could get compensation
for losing their livelihood was to sue BP in federal court. In 2012, the
oil company finally agreed to a settlement reimbursing business owners
who could demonstrate a loss of income during or after the spill.
Federal District Court Judge Carl Barbier, who oversees the settlement,
appointed Louisiana attorney Patrick Juneau to evaluate and process all
spill-related claims. Thus far Juneau’s office has received a total of
186,000 claims.
Now, after paying nearly $4 billion on 48,487 eligible claims,
BP is back in court trying to wriggle out of the deal. As of February
2013, this and other criminal and civil settlements and payments to a
trust fund had cost the company $42.2 billion.
Because there is no cap on the 2012 settlement they signed, the oil
company is seriously concerned that covering all 186,000 claims could
cut into their profits. They assert
that many of the claims are exaggerated or relate to circumstances
other than the spill. They give as an example businesses hundreds of
miles from the coast that have been reimbursed. They also question
companies using 2010 as the base year for their losses if their 2010
income was significantly higher than prior years.
Although Judge Barbier disagrees with their reasoning, he has appointed
former FBI director Louis Freeh to investigate Juneau’s office to
determine whether there have been any ethical breeches or misconduct in
processing the claims. This follows the recent resignation of one of
Juneau’s staff attorneys over allegations of “impropriety”.
Meanwhile BP is appealing Barbier’s ruling in the US Fifth Court of Appeals. In preliminary hearings,
the Fifth Circuit judges are questioning whether BP has a legal right
to challenge the terms of the settlement they agreed to. They point out
it did not require businesses to establish causation – owners merely had
to show a revenue loss. Moreover the settlement specifically states
that losses needed to be calculated in such a way to maximize
reimbursement. The judges also question whether the appellate court even
has jurisdiction to alter the terms of the settlement. There is no
provision in US law for a court to overturn a settlement, which is like a
binding contract, once both parties have signed it.
Intimidation Tactics
BP has asked the appellate court to suspend payouts pending the outcome of Freeh’s investigation. They have also sent claimants warning letters
that they may have to give some of the money back. The attorneys for
the Plaintiffs Steering Committee, James Roy and Stephen Herman, have
responded to BP with a “strongly worded” letter reminding them that no
legal process exists to alter the amount of an award after it has been
paid. They also accuse BP of violating the settlement agreement by
discouraging claimants from pursuing claims.
In a press statement,
Herman admitted the BP letter didn’t surprise him, given that the oil
company was suspended from doing business with the US government after
pleading guilty to lying to the federal government about the spill.”Read More Here
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