A recent move to temporarily halt the recent Gulf Coast oil spill settlement by BP highlights the concern the company has that the court-appointed administrator of the settlement, Patrick Juneau, has been handing out money to businesses that don’t actually deserve a piece of the pie.
Just last week BP filed a petition with a federal court in New Orleans arguing that hundreds of millions of dollars in fictitious losses had already been reported and that these fake claims for money could end up reaching into the billions of dollars.
BP insisted that the judge presiding over the settlement, Carl Barbier, deliver a ruling quickly to help prevent additional losses due to false claims. The filing comes only two weeks after BP issued a statement to its shareholders saying that it was no longer able to accurately estimate the cost of the recently agreed upon settlement that the company believed would initially come to around $7.8 billion. The company recently revised the estimate to $8.5 billion, but now says that the price tag would end up being “significantly higher” than initially estimated.
BP gave several examples of inappropriate payments by the court-appointed administrator that it says reflect an overall problem with the process that it says is too lax and uses an inappropriate formula for calculating damages. In one case, a rice mill located 40 miles from the Gulf Coast was given $21 million even though records showed the company made more money in the year of the oil spill then any time in the previous three years. In another case, a construction company was given $9.7 million despite being located 200 miles away from the coast and not doing business in the area.
Other experts familiar with the case have said that Juneau’s decisions and methods for calculating payments have been upheld by Judge Barbier in the past and likely will in the future. Plaintiffs’ attorneys believe that from the start, BP undervalued the settlement and underestimated the number of people and businesses that would qualify for settlement proceeds.
BP has asked that Barbier block payments to any businesses whose awards were calculated in January using what it claims is a suspicious formula that results in false positives. It requested that Barbier also block payments to entire industries, including agriculture, construction, professional services, real estate, manufacturing and retail.
If you’ve been impacted by this or any other oil spill, don’t hesitate to contact the Mississippi BP Deepwater Horizon oil spill attorneys atKobs & Philley at toll free (601) 856-7800.
Source: “BP seeks to block Gulf oil spill settlement payments,” by The Associated Press, published at AL.com.
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