NEW ORLEANS -- While BP dukes it out with the government over whether gross negligence caused its catastrophic 2010 oil spill, the company is quietly trying to change the rules governing some of the business damage claims it’s already agreed to pay.
Last April, BP agreed with a group of individual claimants to pay them for economic damages caused by the spill. The company estimated that settlement would cost it $7.8 billion.
But those cost estimates have recently jumped to $8.5 billion, and the company is starting to challenge the way the court’s independent claims administrator is interpreting the settlement.
In October, BP asked administrator Patrick Juneau to more critically analyze whether losses in industries with fluctuating revenues – such as farming, construction and legal services – were really due to the spill. And Juneau responded by putting out a detailed policy on how to determine “variable profits” for claimants in 143 different industries.
U.S. District Judge Carl Barbier, who formally approved the class-action settlement in December, upheld Juneau’s interpretation last month. In essence, Barbier said that once the claimants establish a loss because of the spill, their claim is calculated based on a formula and is not subject to any further analysis of which parts of their loss were from the spill and which parts weren’t.
But BP has asked Barbier to reconsider – twice. And earlier this month, emails went out to plaintiffs’ lawyers informing them that all Business Economic Loss claims in the categories of agriculture, construction and professional services have been put on hold.
Juneau confirmed that he has not been able to pay any of those claims since the dispute was raised last year. There could be more than 20,000 such claims, according to the latest payment statistics.