Recently, Florida Senator Bill Nelson penned a letter to Deepwater Horizon Claims Administrator Patrick Juneau urging Mr. Juneau to speed up claims analysis. While the resolution of individual and business economic loss claims associated with BP’s disaster has been much too slow, the fault lies squarely at BP’s feet, not Mr. Juneau’s.
BP’s Brilliant Subterfuge
In 2012, with BP’s enthusiastic urging, Claims Administrator Juneau and his staff processed and paid (if eligible) most claims within 60-90 days of filing. The company was all too happy to promote the program’s efficiencies as it sought judicial approval for the compact. Then, once the Settlement was officially blessed by Judge Barbier, BP went about attempting to systematically dismantle it.
Objective number one for the company was to slow down payments by any means possible. This included cooking up largely unfounded allegations of fraud and filing losing lawsuits that BP pressed all the way to the Supreme Court of the United States (which promptly told the company to go pound sand).
BP’s course reversal after Settlement approval was not lost on Judge Barbier:
“[I]f anyone is attempting to rewrite or disregard the unambiguous terms of the Settlement Agreement, it is counsel for BP. Frankly, it is surprising that the same counsel who represented BP during the settlement negotiations, participated in drafting the final Settlement Agreement, and then strenuously advocated for approval of the settlement before this Court, now come to this Court and the Fifth Circuit and contradict everything they have previously done or said on this issue. Such actions are deeply disappointing.” – Judge Barbier, December 24, 2013
I have written before about BP saying one thing while doing the opposite. Unfortunately for the people of the Gulf, such is the company’s modus operandi.
1,419 Days Later
Rick Godfrey, BP’s lead attorney in 2012, told claimants and the Court that the Settlement is “placing large sums of money today and tomorrow and next week into the hands of the communities of the Gulf.” It has been 1,419 “todays and tomorrows” since the Settlement Agreement was executed. And there have been 203 “next weeks.”
In that time BP has sued the Claims Administrator, filed one legal challenge after the other with the 5th Circuit Court of Appeals, asked the Supreme Court to intervene, refused to pay the vendors hired to process the claims, levied all sorts of unfounded allegations of conflicts of interest, and appealed thousands of legitimate awards made to small business people devastated by the spill. As a result, only a modest fraction of claims have actually been paid, 3 years, 10 months, and 19 days later. There is no question that it is BP slowing down the flow of money to victims, not the Claims Administrator.
BP has lost nearly every one of these legal battles, but a substantive victory is not what BP seeks. Despite BP attorney Godfrey telling us that the payment “process should not be interrupted or stopped based upon the objections of the few for the purpose of injuring the many who need to be compensated now,” that is exactly what BP has done. It was intentional, and there is little that Mr. Juneau could have done to stop it.
Bad Faith Appeals?
One of BP’s most effective tools is the filing of baseless appeals that border on bad faith. BP has filed over 6,000 such appeals, losing 75% of them. But winning is not BP’s aim, delaying payment is, as the appeal process takes between three and six months to complete.
The frivolous nature of these appeals is not lost on the appeal panelists, well respected emeritus attorneys who review the claims de novo:
“The grounds assigned by BP on this appeal are the weakest and least supported yet. … The lack of any credible argument on this appeal makes this panelist question whether it was taken in good faith.” Appeal 2014-974
“BP’s proposal … is totally unsupported…” Appeal 2014-986
“BP suggests that switching to this alternative period would actually have decreased claimant’s recovery. This is completely inaccurate and BP seems to be pulling numbers out of thin air.” Appeal 2014-472
“BP offers nothing whatsoever in support of its contention … and it should be noted that the first basis for appeal cited by BP is vague and completely lacking in detail … this panelists finds no support for BP’s contention.” Appeal 2014-433
“I find no merit in BP’s argument.” Appeal 2014-446
“BP’s utter failure to disclose this information is troubling when disclosure is undoubtedly required.” Appeal 2014-385
“BP’s evidence is scant.” Appeal 2014-439
“In this Panelist’s view, [BP’s] arguments have nothing whatsoever to do with the substance of [the alleged error] and should be ignored as a violation of Appeal Panel Procedural Rule 8.” Appeal 2014-486
“There is no textual reading of Exhibit 4C of the Settlement Agreement that supports BP’s argument.” Appeal 2014-437
“Finding no basis in the Settlement Agreement supporting BP’s position.” Appeal 2014-415
“In neither instance does BP cite to anything in the record in support of its suppositions.” Appeal 2014-448
“This appears to be a case in which BP has drawn incorrect conclusions from selected parts of the record and presented them on appeal as fact. A review of the record demonstrates that BP’s argument is incorrect.” Appeal 2014-447
“BP does not offer any evidence that Policy 495 was misapplied.” Appeal 2014-469
“BP’s appeal on the issue is without merit.” Appeal 2014-473
“BP’s position is without merit.” Appeal 2014-494
“There is simply no basis for BP’s relentless advancement of arguments that have been soundly and consistently rejected.” Appeal 2015-178
“There is no question that Claimant’s financials meet the requirements set forth in … the Settlement Agreement. … BP’s appeal is without merit.” Appeal 2015-1151
“The Settlement Program’s award is, as a matter of law, deemed properly matched. Given this, BP’s claim of error is wholly misplaced.” Appeal 2015-1147
“BP[‘s] argue[ment] … is patently false … [and] disingenuous.” Appeal 2015-1062
“There is no need for further analysis [as] this issue is supported by a large body of appeal jurisprudence and should be regarded as well settled. This fact should be … obvious to BP.” Appeal 2015-428
“BP’s contentions have been rejected dozens upon dozens of times.” Appeal 2014-1002
“This panelist will rule against BP on this issue ad nauseam.” Appeal 2014-997
“To say that BP was misleading would be kind.” Appeal 2015-482