Late Friday night, BP filed its formal petition to the U.S. Supreme Court claiming that lower courts in New Orleans erroneously approved a multi-billion-dollar settlement that is paying claimants that were not hurt by the company's 2010 oil spill.
The writ of certiorari petition, which asks the Supreme Court to take up the case, has been expected since May, when the U.S. 5th Circuit Court of Appeals rejected BP's attempts to undo the massive damage settlement it agreed to and helped craft in 2012. In fact, BP already asked the high court to keep in place a stay on business claims payments that it is challenging and the Supreme Court denied that application in June.
The British oil giant officially urged the Supreme Court to take the case Friday, arguing that several other circuit courts have found that class-action settlements should not be approved if they include people and businesses that were not actually hurt by the defendant's actions.
This is based on BP's contention that its settlement with private plaintiffs was 'hijacked' by court-appointed claims administrator Patrick Juneau because of how Juneau is determining claimants' eligibility. In the petition filed Friday, BP says Juneau has paid 'more than $76 million to entities whose losses had nothing to do with the spill, as well as an additional $546 million to claimants that are located far from the spill and are engaged in businesses whose revenues and profits bear no logical connection to the spill.'
BP says 130,000 pending claims could be affected. The latest public statistics for the settlement program show that 46,000 claimants have been paid so far. If the Supreme Court rules in BP's favor, it's unclear how it would affect those who have already been paid.
But BP has lost its previous arguments on this question before. U.S. District Judge Carl Barbier and the 5th Circuit appellate court each ruled against BP because evidence clearly shows that BP's lawyers agreed to a settlement in which a business claimant's losses are assumed to come from the oil spill if that claimant is located in certain zones along the Gulf Coast and meets a basic formula for lost revenues and recovery.
In fact, BP has totally changed directions on its argument in the last year. BP's high-priced appellate lawyer, former U.S. Solicitor General Ted Olson, initially argued in the 5th Circuit that BP agreed to pay businesses whose losses were not from the spill as part of a compromise, then later claimed that it should not have to pay anyone whose losses were from anything other than the spill.
The Supreme Court could decide in October whether to hear BP's appeal. That's when the high court typically decides which cases to hear for its next session.