The oil that washed ashore after tropical Storm Lee…fresh as ever!

“Auburn University experts who studied tar samples at the request of coastal leaders said the latest wave of gooey orbs and chunks appeared relatively fresh, smelled strongly and were hardly changed chemically from the weathered oil that collected on Gulf beaches during the spill. The study concluded that mats of oil – not weathered tar, which is harder and contains fewer hydrocarbons – are still submerged on the seabed and could pose a long-term risk to coastal ecosystems.”

And whereas BP continues to do beach clean-up post tropical storm, they sure aren’t commenting on Auburn’s conclusions…which I suppose is understandable as they are busy these days, you know, in court, meeting with Judge Carl Barbier in the latest status conference, this time to argue against state punitive damages. Andrew Langer, attorney for British Petroleum contends that Barbier already ruled on these damages August 26th by saying OPA and federal maritime law governed in this case which would render state law null and void, but Corey Maze, the deputy attorney general from Alabama, argued otherwise by saying if states are unable to recover damages under state law, this strips the states of the power to protect themselves.

Barbier, seeming to side with the states, proposed the rocket launch theory, “We’re talking about state sovereignty,” Barbier said, addressing BP attorney Andrew Langan. “You can imagine scenarios … where someone launches a rocket from federal waters and it lands on someone’s property in Louisiana or Alabama and lands on someone’s roof and causes death. … You don’t think someone in Alabama or Louisiana could file a claim?”

The main question would appear to be that even though OPA and federal maritime law govern in this case, can states seek punitive damages to “fill in the gap,” this gap being potentially necessary because the federal government is under no legal obligation to give money recovered in fines under the Clean Water Act to the Gulf region. A Senate bill with bipartisan support that will give 80% of fines collected to the region is making its way through committee, but in these days of the Tea Party, who can trust Congress to do what’s right for the people? Judge Barbier gave each of the parties a week to submit legal briefs on the matter and presumably, Barbier will rule on this at the next status conference which is set for October 21st, with the actual trial set to begin in February…

If that trial is even necessary:

What?

Yes: Analysis: BP oil spill report may prompt $30 billion pay-out

Findings of the second major investigation by the U.S. government into the 2010 Gulf of Mexico oil spill, may press BP into putting over $30 billion on the table to quickly settle its outstanding legal headaches. The report, released on Wednesday, was even more damning of BP’s behavior than the Presidential panel’s findings, which were issued in January and February. Both reports also highlighted mistakes made by BP’s contractors, driller Transocean and cement specialist Halliburton. The investigations have not left London-based BP eager to face the Department of Justice or civil claimants in court.

“We would like everything settled as soon as we can, otherwise you have lingering reputation issues and investor uncertainty,” one insider said after the latest report.

At issue is whether BP will be ruled grossly negligent which will dramatically increase their per barrel fines under the Clean Water Act and after the report by the Joint Investigation Team of the Federal Bureau of Ocean Energy Management, Regulation and Enforcement and the Coast Guard this is something that looks increasingly likely.

Stuart Smith writes a solid analysis of this legal end and the advantages BP might have by offering a settlement instead of actually going to trial, which of course revolves primarily around money. A settlement, instead of a long drawn out trial could allow BP to finally clean up their corporate image by putting this whole episode behind them, and if they were to go to trial and lose, be found grossly negligent and in addition ordered to pay punitive damages, the cost could far exceed a $30 billion dollar offer. British Petroleum obviously wouldn’t want to face a loss like that. Their company remains in financial trouble enough and that kind of judgement, well…that kind of judgement would be like a rocket launch from a Louisiana courthouse straight into BP’s corporate headquarters.

Or maybe, tar balls continuing to wash up on their shores.

Have a nice day.