By Robert Cunningham
As part of a recently launched publicity campaign, the chairman and president of BP America has written an opinion letter claiming the settlement agreement BP helped author is paying fictitious and inflated claims. The campaign is a carefully planned attempt to intimidate businesses and their attorneys who have properly filed claims according to the terms that BP agreed to.
BP’s publicity campaign ignores the facts surrounding the settlement, what the company told the court in order to obtain approval of the settlement, and the wording of the agreement itself. In 2010 and 2011, when the settlement was being negotiated, BP was very concerned. It was facing governmental, legal, and public attacks for the total absence of corporate integrity that led to the worst oil spill that the world has ever seen, the death of eleven men, still unknown environmental damage, and destruction of the Gulf Coast economy. In short, BP’s financial future was at risk.
Facing potential failure under the weight of the economic impacts of the spill, BP sought to negotiate a resolution, a resolution that BP’s Board was told would cost billions of dollars but which would secure the financial survival of the company.
The damage calculations were negotiated at length over a two-year period by the parties’ counsel, assisted and informed by experts and colleagues with specialized knowledge of various aspects of the litigation and the array of claims categories. These specialists, who included economists, accountants, and real estate experts, among others, analyzed and responded to questions throughout the negotiation process posed by both BP and attorneys representing claimants. Simply put, all sides know exactly what the agreement says and how it is to be implemented.
By signing and obtaining court approval of the one thousand-plus page settlement agreement, BP got predictability, eliminated uncertainty, and the people of the Gulf received economic aid when they needed it the most, not ten years from now. This was a negotiation. Claimants agreed to forgo the opportunity to seek damages extending beyond 2010, as well as the possibility of punitive damages.
The settlement is intended to be applied exactly as it is written, which is exactly what court appointed administrator Pat Juneau did and what United States District Judge Carl Barbier confirmed three separate times. The fact that a business economic loss claim is based on a pure revenue analysis, subject to the timing of the receipt of the revenue, is what was intended, expressly negotiated for, and agreed to by BP when it wanted financial protection.
BP generates almost $400 billion a year. It now cries “foul” when it is projected to pay about three months of earnings to compensate families and businesses for the Deepwater Horizon disaster. It is ironic that BP talks about people “getting something for nothing” when that’s exactly what BP is trying to do.
When BP was facing a trial on the merits and felony charges, it agreed to the economic class settlement, and, initially, promoted the settlement program, encouraging many claimants to file. Now that the felony charges have been resolved, (BP using the settlement as a basis for reduced criminal fines and penalties), and now that the phase one liability trial has concluded, laying bare BP’s gross negligence, and exposing the company to billions more in additional civil fines and damages, BP is looking for a way to save some money.
BP waited until after the three-year anniversary of the spill, after the class settlement was approved, and after the criminal charges were resolved, before setting off on this anti-settlement (and anti-class member, anti-claims administrator, anti-small business, anti-lawyer, and anti-Gulf Coast) campaign.
We should not be surprised that BP is not telling the truth about the settlement and the claims process. At the time of the Deepwater Horizon disaster, BP was a convicted felon on probation for the 2005 Texas City explosion which killed fifteen people and injured hundreds. Today, at the time of its current multi-million dollar PR campaign, BP is again on criminal probation for eleven deaths that it caused on the Deepwater Horizon. The difference between BP and most other convicted felons is that it has millions of dollars to spend trying to falsely convince the public that it is being mistreated by the American judicial system in the enforcement of a settlement which it negotiated and to which it agreed.
Robert “Bobo” Cunningham is a senior partner with the Mobile law firm Cunningham Bounds, LLC, and was one of the lead plaintiff’s attorneys in the litigation that resulted in the BP settlement.