Yesterday, Judge Carl Barbier ruled British Petroleum was guilty of gross negligence in the lead-up to the Deepwater Horizon disaster, stating BP made “profit-driven decisions” during the drilling of the well and “these instances of negligence, taken together, evince an extreme deviation from the standard of care and a conscious disregard of known risk.” Barbier went on to say that due to the “egregious” nature of BP’s actions, if legal precedent had permitted, he would have found it appropriate to tack on punitive damages in the case.
British Petroleum, feeling justice had run its due course, nodded solemnly and agreed it was time to truly make things right by dropping any further legal proceedings and began to immediately pay claims again. They also issued a heart-felt apology to all it had harmed through it’s actions over the past years.
No…instead BP immediately threatened to appeal the ruling and called the decision “erroneous,” while insinuating the court isn’t being impartial.
Now that sounds more like the oil company we all know and loathe and so, a few reactions to these events:
1. The immediate would of course be to simply express towards BP, “Good. Deal with it you responsibility shirking, PR department hiding greed-merchants. You put profit first, ruined many and you get what you deserve.”
2. A more thoughtful response could simply be wonderment…is it possible that a mega-corporation is finally being held legally responsible for their actions, and in a way that actually helps those the company has harmed? The increased fines from this ruling will benefit coastal restoration projects, and coastal restoration is good for all in Louisiana. The oil spill did much, much damage to the coast, to the wildlife, to businesses and to people. British Petroleum made a lot of promises when this was headline news, but appears to be trying to extricate themselves from their mess as much as possible now that the media has gone. This ruling puts them financially back on the hook for their reckless behavior in a way that can make a strong impact in coastal restoration.
3. BP will appeal, of course. Why not? Nothing for them to lose here in an appeal process, nothing at all. Exxon dragged the whole Valdez thing out for how long, twenty years? So of course British Petroleum will do the same. And we haven’t even gotten to the legal arguments about how many barrels of oil were actually spilled, there being a vast difference between BP’s estimate and the government’s. With the fine potentially being $4,300 dollars a barrel, there will be a huge financial difference.
4. The government could respond to BP’s endless appeals by putting financial pressure on the company. As I wrote before, the government has some leverage, for while it is certainly BP’s right to fight each and every legal ruling with time consuming appeals while people go broke, the environment continues to degrade and the coast disappears, it is also the government’s right to step in and say, “You know what? That oil spill thing has become so contentious and we just don’t want to muddy the waters any further so, BP? Yeah, we’re just going to suspend your Gulf oil leases until this is all over, settled, until everybody’s happy and then we can move forward again as partners, in good faith.”
But for now, British Petroleum continues to drill in the Gulf while at the same time play the victim in the aftermath of their own, created destruction. They say the judge is not impartial, the people are demanding too much, we can’t be blamed for the decline in oyster harvest; there isn’t enough proof. And this goes on and on and on…all while they maintain how they’re a wonderful and even “green” company who is nothing more but your humble steward doing everything they can to right what’s wrong.
It’s bullshit…like BofA, like Chase: BP’s just another company doing some, but not enough to fix the problems they created when they put profit before all. British Petroleum should, and can do a lot more by dropping their appeals, the delay tactics and any pretense at being a victim and pay up, make good on their promises.
Much appreciation to Judge Carl Barbier for an important ruling, one that might go a ways in making sure this actually happens.
In the latest from the MDL litigation, Transocean, the owner of the Deepwater Horizon, alleged that their contract with British Petroleum, the leaseholder of the Macondo Well, had indemnified them against any liabilities for pollution underneath the surface of the Gulf, and also against any civil penalties under the Clean Water Act or punitive damages from being declared grossly negligent. British Petroleum, of course asserted otherwise, as did the US Department of Justice.
Well, yesterday Judge Barbier issued his rulings. He decided the contract did indeed clear Transocean from those damage claims occurring below the surface of the water, it is British Petroleum who will be the responsible party for pollution damages from the 4.9 million barrels that leaked directly from the Macondo Well. Barbier also ruled the contract did not shield Transocean from any liability for punitive damages should their company be declared grossly negligent, nor did it indemnify them from any potential civil penalties under the Clean Water Act.
Transocean, of course, declared this ruling a victory, “This confirms that BP is responsible for all economic damages caused by the oil that leaked from its Macondo well, and discredits BP’s ongoing attempts to evade both its contractual and financial obligations. Transocean is pleased to see its position affirmed, consistent with the law and the long-established model for allocating risks in the offshore oil and gas industry…”
This only makes sense.
You see, BP was trying to skirt their responsibilities under the law and Barbier set them straight.
British Petroleum also felt themselves to be quite victorious, “Today’s ruling makes clear that contractors will be held accountable for their actions under the law. While all official investigations have concluded that Transocean played a causal role in the accident, the contractor has long contended it is fully indemnified by BP for the liabilities resulting from the oil spill. The Court rejected this view…”
This too only makes sense.
You see, Transocean was trying to skirt their responsibilities under the the law and Barbier set them straight.
And with spin factories so readily engaged, victory toasts were had all around.
Executives clapped lawyers on backs and lawyers hit speed dials to their favorite banking institutions to check account balances.
And with all these companies claiming all these victories over all these decisions, when the dust settled and the cheering finally dissipated into idle conversations about Super Bowls and stock options, it was almost kind of easy to forget that when it comes to this catastraphuk that unleashed 4.9 million barrels of oil after an explosion that killed eleven people, just how there really were no victories to be had here…
When it comes to the worst environmental disaster to hit the United States, British Petroleum had a hand in it, and so did Transocean, and for that matter so did Anardarko and Halliburton…and no matter how Barbier ruled yesterday, not one person from any of these companies has yet to spend a day in jail.
So yeah…Transocean claims victory. British Petroleum claims victory. Transocean calls British Petroleum liable and vice versa, yet eleven people are still dead while thousands of others still wait to be made whole, and all cheering aside, that’s something someone should be liable for…criminally.
Back in August, US District Court Judge Carl Barbier issued a ruling allowing for claimants in the B1 Bundle to sue British Petroleum for punitive damages, a ruling BP appealed.
“I have given this a lot of thought,” Barbier said about BP’s appeal at the end of last week…
The B1 bundle includes all claims for private or “nongovernmental economic loss and property damages…” meaning claims for economic damages filed by fishermen, seafood processors and distributors, recreational and commercial businesses, plant and dock workers and those who worked for BP’s Vessels of Opportunity program.
British Petroleum attorney Andrew Lanagan seemed to suggest that by kicking these claims out of the litigation, Barbier would only be doing these claimants a favor, “We still have the GCCF [Gulf Coast Claims Facility] in place. If these claims are all eliminated from litigation, litigants will have no option but to go through the GCCF.”
Yes, through the GCCF, where claimants can’t receive compensation for punitive damages, where they are getting shafted by low compensation offers, where they’re claims are often dismissed outright by Ken Feinberg’s process.
You know, that place where British Petroleum can exact a certain amount of control, unlike Barbier’s Courtroom.
In defending the plaintiff’s right to not have their cases dismissed on appeal before they even had a chance to be heard, Elizabeth Cabraser, the plaintiff’s attorney, argued, “The law, like time, does not flow backwards.”
And this must have come as news to British Petroleum, who in the past week has not only announced what CEO Bob Dudley called a “turning point” in its profits for the third quarter, but they have also received permission to resume deepwater drilling in the Gulf of Mexico from the Interior Department.
Yes, if it weren’t for Barbier’s ruling, it might seem like March of 2010, all over again…
“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…
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.
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.
In a Fox News article posted over the weekend, Ken Feinberg said the claims process was winding down. He also told the Telegraph he’d processed over 80% of claims, “I’ve used just over $4 billion dollars…I don’t envision a flood of new claims.”
Interesting, and potentially problematic…
With the terrible beginning to the brown shrimp season resulting in a new groups of claims being filed, we could be witnessing a new reality in the Gulf, one where the fisheries and the sea life have not come through the past year unscathed. With the dead dolphins, the meager oyster beds and now the brown shrimp catch being way off, what other surprises might be lurking under the water? And should it affect Feinberg’s plan to close down the claims offices along the Gulf Coast?
Note, I said “should” affect, because it would appear Feinberg has little intention of altering his plans.
Despite Jefferson Parish officials fighting these closures, Feinberg has not indicated in any way he will refrain and keep them open, no matter how many shrimpers now wish to file.
Equally as important, this plan to wind things down doesn’t appear to take into account an awaited ruling by Judge Carl Barbier.
Last week, British Petroleum argued in Barbier’s court up to 130,000 filed lawsuits should be dismissed under the Oil Pollution act of 1990. BP’s lawyers believe that before these suits can be filed, they must first attempt to seek damages through the GCCF, and if they are denied, then they can go to court with their damage complaints. If Barbier should agree and dismiss these lawsuits, it could result in up to 130,000 new claims entering into the GCCF process…whether this will happen or not is unknown, yet still Feinberg sees fit to begin closing down claims offices.
And do I really need to mention, yet again, how few interim claims Feinberg has paid?
Or depending on Barbier and the Gulf of Mexico, maybe we’re just about to get started, again.
Lawyers being lawyers, and British Petroleum having long since given up that whole “making things right,” and “actions, not words” schtick – at least in reality – of course BP is going to try to use every legal maneuver to pay as little as possible to anyone. Their company’s in trouble now that the Rosneft deal looks blown so yeah, that whole Gulf Coast thing…it’s one big financial/legal liability and since the media interest flags, it’s time for corporate law to rear the ugliest of heads to take the biggest bite they can…
So stated, let’s move on to the latest from British Petroleum’s attorneys in Judge Carl Barbier’s court, shall we?
Turns out (surprise) British Petroleum is of the legal opinion that the claims for economic and punitive damages as a result of their little ‘ol spill, including those who lost jobs/wages as a result of the drilling moratorium, including those first responders who got sick during the cleanup, including basically…everybody, should be summarily dismissed by Judge Barbier.
Because these people must go through Feinberg’s GCCF claims process, first.
That pesky Oil Pollution Act of 1990, that’s why. Andrew Langer, BP’s head legal talking head argues that OPA states claimants must first attempt to redress their grievances with the responsible party – BP, and if they are then denied by the responsible party, only then can they file a claim in court. Langer also claims the Oil Pollution Act supersedes maritime law, and since OPA doesn’t allow for the punitive damages allowed under maritime law, these claims must be dismissed as well.
Dismissed, just like that…upwards of 130,000 legal claims.
Judge Barbier gave no timeline on when he would rule on the matter, but perhaps Feinberg now should really want to hold off on closing all those GCCF claims offices, you know, just in case.
BP’s desire isn’t surprising, it makes sense they would want these people to go through the GCCF. Much as the oil company would like to control a United States court of law, they don’t, but the GCCF and Feinberg are a different matter. There they hold much more sway. Hell, their guy wrote the rules, the same man Judge Barbier already ruled can’t claim himself as independent of BP. Good ‘ol Ken, the lawyer whose law firm is paid $1.25 million dollars a month by BP. Way back when, the GCCF and Feinberg’s stated mission was to keep people out of court, but this didn’t entirely happen, especially when his “generous” payments turned out to not be so generous after all. So now British Petroleum argues Judge Barbier should rule in their favor and complete Feinberg’s mission for them, kick the claimants into BP’s court, where they can be delayed, stalled, and hopefully, so frustrated that some throw up their hands and take Feinberg’s “generous” claims instead of heading back into court to be delayed, stalled and frustrated anew by BP’s lawyers.
From a legal standpoint, it makes sense. What does British Petroleum really have to lose? Self respect? The goodwill of the Gulf Coast? Well, self-respect and goodwill ain’t worth a dime and this whole mess has appeared to be about the money for this company since day one.
The plaintiffs’ attorneys, of course, disagree with BP, arguing OPA was created after the 1989 Exxon-Valdez spill because legal remedies available at the time were insufficient. They further argue the companies involved in the explosion of the Deepwater Horizon shouldn’t be able to now use OPA as a legal shield to escape punitive damages and throw these legal claims into the GCCF mess. Besides, the oil pollution act of 1990 doesn’t expressly declare an intent to displace maritime law, whereas other statutes that prevent punitive damages do specifically prohibit them.
Judge Barbier, who questioned both sides’ arguments, asked how it is he is supposed to go through the 130,000 cases to determine which should be thrown out and which should be allowed to proceed. Nobody seemed to have an answer on this, beyond saying such a process will be exceedingly time-consuming.
Even more so pehaps, then the GCCF’s claim process.
But British Petroleum wasn’t the only company to get in on this four-hour hearing, and all involved had an argument on why these pesky economic claims should be dismissed. Represented in court were Anadarko, Halliburton, Cameron International and Transocean. Transocean argued that since BP is the responsible party, economic claims should only be made against BP under OPA, and then it would be BP’s right to go after the other companies to pay their share. You see, the people have filed suit against the wrong companies in the wrong order.
In other words, much like Feinberg’s screaming about unsatisfactory documentation, all of the big companies on the hook here are claiming the businesses and the people of the Gulf Coast are doing it wrong, not adhering to the correct process, not filing suit against the right company, not going through the GCCF process first, where they would inevitably be unable to document their claims in the correct way.
Or in other, other words…the claimants, the victims in this colossal fuck-all, the right thing for them to do would be to do as they are told, hurry up and wait, and go back to a GCCF process many consider long since broken.
All unless Judge Barbier, much like finally declaring Feinberg not independent, sides again on behalf of the people so harmed by this disaster, a catastraphuk not of their own creation.
Oh, but that’s not all, there’s more…
On the drilling moratorium: BP also asked for a dismissal of the claims by people who lost jobs/wages as a result of the drilling moratorium, saying it was the government who declared the moratorium, not BP, so why are they at fault? According to the plaintiffs’ attorneys, the moratorium was something the government would reasonable feel was necessary when they realized, hey, those oil rigs aren’t as safe as we ignored/were led to believe and you know what? We don’t have the resources to fight off these kind of spills so we better do a safety check. The plantiffs’ attorneys are also guessing the moratorium wouldn’t have happened had the Deepwater Horizon not exploded and since, under OPA, BP is the responsible party…well…they should be liable because one plus one usually equals two.
Unless you’re watching the latest “making it right,” advertisement by British Petroleum.
Attorneys for Nalco were also in court, the makers of Corexit dispersant and they argued they should have immunity from damage claims by people who got sick inhaling their toxins because the Federal government was in charge of the response, and it was the federal government who chose to use Corexit, “This was a spill of national significance, which put all of the decision-making in the hands of the federal government,” said their attorney.
One might wonder if this attorney is referring to the same government whose EPA expressly ordered British Petroleum to stop using Corexit dispersant, only to have BP refuse…somehow equating BP’s ability to do as they wished throughout the spill response with the ability of the government to be in charge of all the decision-making.
There’s also the matter of all the private contractors who claim they deserve immunity too because they were doing cleanup under the same fully authoritative decision-making of the same federal government who had everyone listening intently on that whole Corexit deal. The plaintiffs’ attorneys in this case rightfully argued said contractors weren’t working for the government, they were hired by and working for BP and thus, why should they have immunity?
The entire hearing lasted a total of four hours and there’s more, but damn, my fingers are getting tired so perhaps I should just try wrapping this up:
British Petroleum, Transocean, Anadarko, Cameron International, Nalco…dismiss everything so we can better direct our funds to making things right for the Gulf Coast…
Residents and businesses of the Gulf Coast…get out of their way, you’re doing it wrong so go talk to Feinberg and he’ll tell you in no uncertain terms just how wrong you all are, while he painstakingly helps you to move on, being the loyal neutral arbitrator that he is…
The lawyers? Well, they’re busy being lawyers…
But most importantly, Judge Barbier, it’s up to you now and I for one, hope your ruling continues the process of finally making things right for all the people along the Gulf Coast that British Petroleum has made so wrong.
A couple of days ago I wrote a bit about how Ken Feinberg’s credibility is a thing of the past.
In fact, his credibility began eroding just a few weeks into his tenure as the neutral arbitrator of British Petroleum’s compensation fund when his initial promises of EAP claims being paid for individuals within 48 hours and business inside of a week quickly fell through. Then the destruction became complete just a couple of weeks back when Judge Carl Barbier of the US District Court ruled that Feinberg was not neutral and not independent of British Petroleum and must stop referring to himself as such.
So it would only seem fair that when Mr. Feinberg, in a conference call to Alabama elected officials, promised that his GCCF will process at least 25% of all pending claims by March 31st, one might be skeptical of his pledge.
Indicating such feeling, both Alabama Governor, Robert Bentley and Attorney General Luther Strange said they would hold Feinberg to his word.
And Gulf Shores Councilman Jason Dyken also expressed the obvious about Feinberg’s promises, “He’s been saying that for six months.” Dyken went on to say, “And I’m not very optimistic. I understand the complexity of their task, and I understand the magnitude of their task. But then again, it’s not rocket science.”
As I’ve written before, growing popular opinion is that Feinberg is stalling payments in an attempt to get claimants to accept smaller offers out of desperation and it’s a strategy that appears to be working if the few numbers anyone is able to pry out of the GCCF are any indication: of 573 final offers made, about 129 claimants accepted an average payment of a little more than $11,000.
To cover any damages from the spill, lost wages, lost culture, physical and mental health problems and a still uncertain future. I personally work in one of the lowest paid professions out there and $11,000 dollars wouldn’t reimburse me for five months, let alone eleven months so far since British Petroleum screwed up the entire Gulf.
But, I suppose it could always be worse.
Hundreds of thousands of claimants were completely shut out of this process for reasons Feinberg’s lack of transparency fails to reveal, and in my opinion, their settlements were worth precisely the amount of both Feinberg’s credibility and sense of integrity…
When US District Court Judge Carl Barbier issued his ruling which declared Feinberg and the GCCF were not independent of British Petroleum, but more of a related hybrid entity, he requested all parties involved file briefs for his consideration in making a future ruling on whether the oil claims process follows the law.
And the briefs came.
And when they came, the sides were revealed.
Whereas state governments and plaintiff attorneys are obviously taking the position the GCCF needs court supervision, the Federal Government has taken up the side of Feinberg and British Petroleum.
U.S. assistant attorney general for Environment and Natural Resources, Ignacia Moreno wrote that it is not necessary for the court to monitor the Gulf Coast Claims Facility, whose success “can only be measured by whether the people of the Gulf feel fairly treated.”
It would appear Mr. Moreno not only missed a meeting, he missed all the meetings, every town hall meeting Feinberg held while at the same time revealing his office’s internet was either down, or the GCCF website was blocked during the public comment period. Or maybe, when those 1400 plus comments rolled in from Gulf Coast residents, he was only able to find the dozen or so positive ones while the other thousand plus negative criticisms perhaps managed a daring daylight escape over the wall of his attentions.
British Petroleum, of course, also felt judicial oversight was not necessary for the GCCF to comply with the Oil Pollution Act, “Judicial supervision of OPA’s claims process would not promote, but instead would undermine, the fair and efficient administration of the process” according to the document filed by BP attorney Don Haycraft, with Liskow and Lewis of New Orleans…also adding “that there may be different ways to run a claims process does not mean that the GCCF’s chosen methods fail to comply with OPA.”
Nothing like a judge to get in the way of British Petroleum’s fair and efficient claims process…the same one that has paid only 1 of 54,000 interim claims filed since mid-December, or a handful of final claims despite weeks and months of waiting. Perhaps the attorneys of British Petroleum only spoke to their one corporate client they pushed to the front of the line of the claims process, the one Feinberg paid ten million dollars at British Petroleum’s suggestion.
Feinberg had a lot to say about judicial oversight as well, maybe feeling the heat from a judge who might step in and be the one thing he can no longer claim to be, neutral…
In his own brief, Feinberg stated that he is complying with the law because the oil pollution act makes no mandates regarding methods of calculating claims, nor does it specify what can or can not be included in releases signed by claimants, but as is often the case with attorneys, especially those aligned with large corporations accused of doing the public harm, what is legally permissible is often a far cry from what is morally sound. Feinberg went on to defend the transparency of his process…showing right away he apparently suffers from many of the same problems as Mr. Moreno and may be even worse considering he not only has repeatedly stated transparency is an issue he needs to improve upon, but many of the residents at his town hall meetings, when they were attacking the lack of transparency, were speaking directly to Feinberg at the time.
The Justice Department, as mentioned before, also weighed in, saying, “it does not envision court management of the claims process. Rather, the OPA claims process is intended as a mechanism by which parties may avoid litigation – not a mechanism that will generate litigation or open up new forums for disputes.”
From many of the comments I’ve received and many news articles I’ve read, it would appear one of the things Feinberg and the GCCF has been quite good at is driving people directly towards litigation, especially the few people in the Gulf Coast who can afford to wait for funds from such a prolonged legal process.
So now, we wait…we wait for Judge Carl Barbier’s ruling.
Gulf Coast residents wait, to see what determination will be made on the legality of the no-sue clause, the waiver.
They wait to see if the healing of the Gulf Coast will be overseen by someone who can more properly and legally define himself as neutral.
Most importantly, they wait to see if that same healing process will work on BP and Feinberg’s forced 2012 timetable, or if all will be made right by a more natural timetable led by the natural processes in the Gulf of Mexico, a timetable which will work of its own accord, unbound by the will of a company whose errors helped lead to its undoing and the individual assigned to apparently just make things right, enough.