BP placed ads in national newspapers ahead of another hearing to determine whether payments being made to oil-spill claimants are inflated and fictitious, as the oil giant alleges they are.
On March 15, BP asked Judge Carl Barbier in New Orleans for an injunction blocking payments to businesses that had filed claims for economic damages stemming from the 2010 Deepwater Horizon oil spill under the settlement’s terms. BP accused oil-spill claims administrator Patrick Juneau of paying claims that the company said were “inflated,” “meritless,” or “fictitious,” despite the fact that the claims were paid according to the terms BP fought for and agreed upon in its March 2012 settlement agreement with plaintiffs’ lawyers.
Judge Barbier, however, upheld the settlement and payment terms, saying that he wanted to “finally resolve the issue.” BP immediately appealed the decision to the U.S. 5th Circuit Court of Appeals. It was the second time BP challenged the settlement terms. The company won a brief halt in paying claims to larger businesses by challenging the settlement provisions in January. But Judge Barbier sided with Mr. Juneau then as well, ruling on March 5 that the claims administrator’s interpretation of the payout rules was correct.
BP’s next hearing on the matter is scheduled for July 8.
The oil giant’s repeated assertions, now presented to the public in the form of newspaper ads in the New York Times, Wall Street Journal, and other papers, have triggered a firestorm of criticism among Gulf Coast leadership, oil-spill claimants and the lawyers representing them.
Billy Nungesser, President of Louisiana’s Plaquemines Parish, told New Orleans’ WVUE that it’s time BP started being specific about its objections.
“We’ve been going through this from day one of this spill where they’re good at throwing things out there with no merit to them,” Mr. Nungesser told WVUE. “So if there’s something that they’re specifically talking about, say we overpaid ‘blank’ claim and we believe that this was fraud or whatever… but don’t put it out there that the lawyers or the teams working on these claims for these businesses and fishermen did something wrong,” Mr. Nungesser added.
Jefferson Parish President Jeff Young was also riled by BP’s assertions that it’s getting fleeced, telling WVUE that, “Instead of spending the money on all these bright-colored ads and TV commercials they ought to be spending the money on cleaning up the coast that they’ve destroyed.”
Some plaintiff’s lawyers suspect that BP’s objections may stem from it possibly underestimating how much the settlement would cost. The company originally figured it would pay about $7.8 billion to resolve the outstanding claims, but it already exceeded that amount weeks ago with several more claims left to honor. Now, some lawyers believe, the oil giant has “buyer’s remorse.”
According to Businessweek, “… BP faces an enormous obstacle: It agreed to the arrangements it now asserts are out of control.” After all, the agreement which set the terms for claimant payouts was the product of months of intense negotiations. BP’s lawyers and executives fully understood the terms that they themselves argued for, co-authored and confirmed multiple times.
BP agreed that any individual or business that qualified for damages under the agreement’s objective and transparent formula had a valid claim for losses. But now BP is trying to disavow the terms of the very Settlement Agreement they agreed to before a Federal District Judge, in order to keep payouts under the limit company executives anticipated.
Meanwhile, it is trying to paint the victims of the oil spill it caused, as well as their lawyers, in a bad light. The move is especially egregious and ironic, considering that BP is a convicted felon on probation for three prior disasters when the Deepwater Horizon rig exploded in April 2010, killing 11 workers and flooding the Gulf with millions of gallons of oil.
BP also pleaded guilty to manslaughter charges for each of the workers killed in the blast and its lack of corporate integrity led to its suspension from doing business with the federal government. Making matters worse, BP was caught and fined for lying to the federal government about the quantity of oil it believed to be gushing from its blow-out well.