NEW ORLEANS -- When BP hosted an event at the London Olympics to promote Gulf seafood and highlight its oil-spill cleanup efforts, Louisiana chef John Folse appeared in his BP chef coat with several tons of seafood dishes his company cooked up and shipped overseas from his manufacturing plant in Donaldsonville.
Now, BP is arguing that Chef John Folse & Co. is not a seafood processor at all -- and therefore should not get the millions of dollars a court-appointed claims administrator recently awarded it to cover its spill-related losses.
It’s being called a “ludicrous” example of the oil giant’s appeal-at-all-costs posture over the last two months – a stance the company staked out once it realized that the multi-billion-dollar settlement it signed last year was costing it far more than it had planned.
Statistics filed in U.S. District Court show that BP has ramped up its appeals of oil spill claims payments as it prepares to ask Judge Carl Barbier on Friday -- for a third time -- to change the way its settlement with business claimants is interpreted by claims administrator Patrick Juneau, the veteran settlement overseer whom BP asked the court to appoint.
BP has appealed 400 awards in the last two months, a quarter of all business loss payments that Juneau has offered in that time.
BP complains that these claimants, mostly in non-Gulf-related industries like farming, construction and professional services, are being paid millions for “fictitious losses.”
Loyola Law Professor Blaine LeCesne, who has been closely following the civil claims process from the beginning, says it doesn’t matter how far-flung the business claims are; BP agreed to pay them and now has buyer’s remorse.
“It doesn't matter because you agreed to it,” LeCesne said. “And the fact that you undervalued it is not a basis for now reneging on the terms to which you agreed. And we're 10 months into this process, 161,000 claimants have filed claims, $2.6 billion dollars have been paid out and now you want to try to put the genie back into the bottle?”
But while BP has drawn some sympathy for having to pay so many allegedly undeserving claims, documents filed by plaintiffs’ attorneys this week indicate that BP is also appealing payments to businesses who rely directly on the gulf.
BP called Wall's Gator Farm in Springfield an example of a "fictitious” agricultural claim. But an affidavit by the farm’s consultant states that alligator eggs were damaged by the spill and that accounted for $2 million in losses -- more than double what Juneau calculated.
And then there’s Folse’s claim. BP countered Juneau’s million-dollar-plus calculation last week by suggesting that the manufacturing company, Chef John Folse & Co., actually deserves $0.
Mainly, BP’s argument focuses on the fact that the firm’s own tax returns use an industry code identifying it as an “Other Food Manufacturer.” Indeed, the company makes some dishes with no seafood in them, such as red beans and rice and chicken and sausage gumbo. BP’s appeal states that there was no proof that Chef John Folse & Co. is a “secondary seafood processor,” as Juneau determined.
"BP is constrained in responding by the confidentiality rules that apply to the claims process,” BP spokesman Scott Dean said in a statement to WWL-TV. But “one relevant question in any such inquiry is how the claimant describes itself in its tax filings and what evidence was filed with the claim."
Nevermind that you can go into almost any grocery store from Kansas to Florida and find tubs of Chef John Folse frozen seafood entrees, all manufactured at his plant on Chef John Folse Boulevard in Donaldsonville.
Or that all the details of the company’s processed seafood dishes, sold at retail grocery stores and distributed to restaurants, are laid out on the firm’s website.
LeCesne finds it laughable that BP is trying to deny the claim when they have so publicly co-opted Folse’s business to promote themselves on the world stage.
“It’s unfathomable that they can actually, with a straight face, suggest that he doesn't qualify based on this six-digit (industry) code,” LeCesne said.
“It's ludicrous, and it would be considered a frivolous appeal, I think, if the appeal were being heard by a court instead of being heard by a panel of attorneys who have been appointed by a court to hear appeals of these awards.”