BP Increases Efforts To Stop Claims Payments
BP has voiced its concern about the Deepwater Horizon oil spill claims payments for months now, but a recent court filing indicates that the company has only lately stepped up its actions to stop the payments. According to a court filing by the oil spill claims administrator, Patrick Juneau, BP has more than doubled the rate at which it appeals claims brought by individuals and businesses under the terms of its settlement agreement.
Back in February of this year, BP disputed only about four percent of the
awards decided on by Juneau. By May, that number had risen dramatically,
to 9.3 percent. BP says it has stepped up its efforts to prevent such
payments from being made because it says many of those claims are fictitious
or overly inflated.
In addition to filing appeals for the claims settled by Juneau, BP has also launched a legal challenge against the method employed by Juneau when calculating the compensation owed to injured plaintiffs. Though the U.S. District Court Judge Carl Barbier, who has overseen the settlement process, approved Juneau’s calculation, BP has appealed that ruling to the Fifth Circuit Court of Appeals.
BP’s argument before the Fifth Circuit is that if the claims are allowed to continue being paid according to Juneau’s calculation, then the company will suffer irreparable harm and the incident will leave a black eye on the entire American justice system. BP says that the problem with the calculation is that businesses are allowed to cherry-pick financial data from previous years that offer the most favorable comparisons when filing for damages.
BP says that the claims process has resulted in awards of about $250 million per month to individuals and business along the Gulf Coast who suffered damage as a result of the 2010 oil spill. Though BP originally forecast the costs of the settlement at about $7.8 billion, it raised that projection to over $8 billion last year and now says the costs will be significantly higher than even that figure if Juneau’s methodology is upheld by the Fifth Circuit.
Plaintiffs have argued that the issue is not whether certain accounting practices might offer a better picture of the financial damage done to Gulf Coast businesses, but what the precise terms of the agreement are. Plaintiffs argue that BP fully understood the terms when it signed the settlement agreement and that buyer’s remorse is not a reason to alter the deal that was already reached.
If you’ve been impacted by this or any other oil spill, don’t hesitate to contact the Mississippi BP Deepwater Horizon oil spill lawyers at Kobs & Philley at toll free (601) 863-8170.
Source: “BP moves to stop ‘irreparable harm’ of oil spill payouts,” by, Ed Crooks published at FT.com.
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