Judge Chastises BP Regarding Actions During Litigation
U.S. District Judge Carl Barbier, who has sole discretion over decisions that could affect the amount of liability owed to those affected by the 2010 oil spill, chastised BP recently for their actions during the litigation. Barbier said that he found BP's actions to be "deeply disappointing." On December 24, 2013, Barbier rejected the argument made by BP that the company should not have to compensate businesses that cannot prove that their losses were caused by the spill.
Barbier initially commented on BP's request after the company filed what is known as an emergency motion with the U.S. Court of Appeals for the 5th Circuit in New Orleans, accusing the judge of defying the court's decision to stop settlement payments that the company says are going to undeserving claimants. Early in December, a three-judge panel of the appeals court ruled that Barbier was in error when he initially refused to consider causation arguments. According to BP, businesses not located near the coastline where the spill occurred have received generous settlement amounts without being required to provide proof of damages. Barbier says that the settlement agreement, which was crafted by BP lawyers, allows businesses to receive compensation even without a causal connection to the spill.
Barbier released an 11-page order earlier in the month that condemns BP for disregarding a settlement that its own lawyers drafted, and says that the company is simply trying to undermine his authority because the settlement has turned out to be much more expensive than originally thought. The judge cited a September 28, 2012, letter from in-house counsel for BP, Mark Holstein, which concedes that claimants who don't actually have spill-related damage would be an "inevitable byproduct" of the settlement due to the terms. The plaintiffs, who stated that they were happy that the judge would not allow BP to "rewrite history and the settlement," applauded the recent ruling.
Stakes are High
The stakes in the dispute are high, especially for BP, as Barbier is supervising both the business claim settlement and the trial in which the government seeks $17 billion or more under the Clean Water Act. Barbier will determine the size of that verdict, without a jury, and his determination more than likely will be based on how credible he finds BP's counsel regarding the presentation and interpretation of highly technical documents. The same lawyers who negotiated and drafted the settlement, then argued strenuously for the court's approval of the settlement, are now contradicting their previous arguments--a move the judge finds "surprising" as this could lead to a loss of credibility in the attorney's expertise in the case. This lack of credibility could lead to higher damages charged against BP in the government trial.
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