BP is asking a federal judge to block a claims administrator from paying business claims for oil spill losses because the company says he is not following the terms of a settlement signed last spring.
This comes on the heels of BP informing its stockholders that the settlement with certain private claimants, which the company initially estimated would cost $7.8 billion, is going to be far more expensive. Cost estimates had already been shifted to $8.5 billion earlier this year, and BP started to raise complaints with the court.
As WWL-TV first exposed last month, BP tried to quietly contest the way court-appointed administrator Patrick Juneau was interpreting the terms of the settlement when it came to claims from so-called variable profit businesses, such as farms, construction companies and professional services. BP’s objection, Juneau’s response and a ruling by Judge Carl Barbier were all done by email and not filed in the court record.
But after Eyewitness News reported that all of the affected claims had been put on hold during the dispute, Barbier ruled officially against BP and ordered Juneau to restart the claims payments. Since that time, BP has filed numerous appeals against payment offers of more than $25,000, as the company is permitted under the settlement.
BP’s filing in court Friday says that Juneau “is about to pay hundreds of millions of dollars, and what could reach billions of dollars, in awards to claims asserting fictitious losses,” and asks the judge for an expedited hearing.
These complaints by BP all have come long after the highly detailed terms of the settlement were reviewed, after objections were heard and after the whole deal was approved by Barbier. The committee of plaintiffs lawyers who negotiated the settlement with BP last year say this new effort to stop Juneau from making business loss payments is sour grapes.
“This court has already affirmed Mr. Juneau’s independent interpretation of the settlement agreement, which is to say that claims are to be paid under the terms spelled out in the agreement – terms which were negotiated, co-authored and expressly agreed to by BP,” the lead lawyers of the settlement class, Jim Roy and Steve Herman, said in a statement. “Simply put, BP undervalued the settlement and underestimated the number of people and businesses that qualify under the objective formulas that BP agreed to.”
Interestingly, Juneau has not always been seen as generous to claimants. In one category of claims -- businesses that failed in the aftermath of the 2010 oil spill – Juneau has only found two claims out of thousands to be eligible for settlement money. Juneau told WWL-TV that it was because the terms of the settlement were more rigorous for that particular category.