Last week, BP spokesperson Geoff Morrell defiantly proclaimed on 60 Minutes that “no company would ever agree to a Settlement that compensates people that were never harmed by their actions. And we most certainly did not agree to such a settlement.”
What Morrell did not say is that the damage payments complained about by BP are indeed traceable to the spill, as they are supported by evidence that BP enthusiastically agreed and admitted on innumerable occasions would be sufficient to objectively establish that claimant losses were in fact caused by its spill.
The evidence required and the analysis methodologies necessary to establish “causation” were negotiated over a period of many months and subsequently memorialized in a 1,200 page legal document. One of the most comprehensive and complex contracts ever conceived. BP attorneys frequently and consistently reiterated the company’s agreement and support of such evidence and methodologies in court filings, emails and statements in open court to presiding Judge Carl Barbier as well as judges on the 5th Circuit Court of Appeals.
So what’s the problem?
BP: We were schooled
No one is actually advocating that those not harmed as a result of BP’s Deepwater Horizon oil spill and subsequent world-class environmental and economic disaster should receive a windfall. Nevertheless, BP is hoping that is what the casual observer believes. That greedy plaintiff trial lawyers, with the help of a crooked Louisiana Bar and judiciary, have somehow rewritten the very precise 1,200 page Settlement Agreement to function more as a jackpot lottery than a fair and reasonable compensation program. That a bunch of C students from second rate law schools in the podunk South actually schooled BP’s $1,000 per hour Harvard educated Manhattan attorneys.
Woe is BP
The problem with BP’s feigned surprise at the way the Settlement Agreement is being implemented is that it should come as no surprise at all. As New Orleans investigative reporter David Hammer pointed out in a report on BP last week, company attorneys and other representatives sang the Agreement’s praises, actually emphasizing its “claimant friendly” nature, “generous payments” and relaxed causation standards. BP’s salespeople were out in full force in an attempt to sell local businesses on the concept of utilizing the theretofore non-contentious payment program rather than suing BP the old fashioned way.
Admittedly, and much to management’s belated chagrin, BP did a good sales job.
In furtherance of this pursuit, BP hired gun and renown economist Henry Fishkind opined the following in court filings:
“The Settlement Agreement establishes a variety of standardized mechanisms that can be used by Claimants that do not receive a presumption to establish that their losses are due to the DWH Spill. These mechanisms are straightforward and transparent, facilitating the review of a claim as well as a Claimant’s decision about whether to participate in the Settlement or to opt out and continue to the claim through litigation.”
In other words, drop your lawsuits and join our party. If your numbers fit our model, it’s good for you and it’s good for BP.
As lead BP attorney Richard Godfrey triumphantly proclaimed to Judge Barbier when seeking judicial approval of the deal:
“We have presumed causation in Zone A (along the beaches). We’ve presumed causation. It’s irrebuttable. You know as well as I do, Your Honor, how many people come in and think they have got a damage claim for economic loss; but, when the facts come out, they had a bad year because they lost their key manager, they had a bad year because the street was being repaired in front of them, whatever reason. We’re presuming causation for whole sections of the settlement class depending on where you reside and the nature of your business.”
Wanting to confirm that he actually heard Mr. Godfrey’s pronouncements on the causation standard correctly, Court Appointed Claims Administrator Patrick Juneau asked BP in September 2012, as a hypothetical, if he should pay an accounting firm that met the eligibility formula but clearly suffered its losses because of a partner’s illness and not the spill. BP’s in-house lawyer, Mark Holstein, said yes, that as long as the test was satisfied, such “false positives” were expected and payment should be made.
So much for spokesperson Morrell’s insistence on 60 Minutes that BP would never agree to pay such a claimant. Then again, veracity and credibility are not BP strong suits.
Reiterating this position, BP attorney Ted Olson, when questioned by 5th Circuit Court of Appeals Judge Edith Clement about the relaxed causation standard, said the methodology was part of a grand compromise and that it is what BP intended and agreed upon. No question about it your honor.
BP would have you believe that tens of thousands of frivolous claimants have hit the winning lottery numbers. Nothing could be further from the truth. The documentation requirements for establishing a loss are stringent and diligently enforced by the Claims Administrator. So much so that over 40% of all claims submitted have been denied – over 50,000 to-date. In fact, more claims have been denied than approved.
BP wants to have its cake and eat it as well. The courts need to put a stop to it. Now.
As a plaintiff attorney, Tom Young has been at the forefront of some of the Nation's worst disasters. In 2015, he was judicially appointed to represent over 200,000 plaintiffs in an allocation proceeding involving a $1.24 billion settlement with Deepwater Horizon contractor Halliburton and rig owner Transocean. Currently, he's focused on representing numerous communities across the country that have been ravaged by the opioid epidemic and are now seeking damages from drug manufacturers and distributors.