BP Unable To Block Oil Spill Claim Payments


On March 15, 2013, BP asked United States District Court Judge Carl Barbier, Jr. to block the Deepwater Horizon claims administrator from awarding “business economic losses” that BP contends are “fictitious” claims for damages.  BP maintains that the claims administrator, Louisiana lawyer Patrick Juneau, was misinterpreting the wording of the settlement agreement regarding larger claimants and was allowing payments “for non-existent, artificially calculated losses.”  BP takes issue with the timing used by companies to determine when losses occurred.  In addition to asking Judge Barbier to enter a temporary injunction prohibiting the claims administrator from awarding business economic losses, BP also filed a separate complaint in federal court against Mr. Juneau and the settlement program seeking to change the rules governing claims payment.

On April 5, 2013, Judge Barbier rejected BP’s request.  Judge Barbier ruled that he had already upheld the claims administrator’s interpretation of the settlement, and he had no reason not to do so again.  Judge Barbier appeared to be somewhat frustrated with BP, its request to halt payments, and its separate lawsuit against the claims administrator.  Regarding BP reasserting its challenge to Mr. Juneau’s interpretation of the settlement agreement, Judge Barbier noted that “[d]espite the fact that the record has continued to grow, I don’t think that it changes the fundamental issue before the Court.”  Regarding BP filing a separate lawsuit against the administrator, the Court noted: “As a matter of law, how can a claims administrator be in breach of his contract if all he’s doing is applying it as he believes it should be applied, and now as ordered by the Court?  How can that possibly be a breach of contract?”

BP has appealed Judge Barbier’s ruling to the Fifth Circuit Court of Appeals.

For more information on environmental law topics, please contact one of the Burr & Forman team members for assistance. We are happy to answer any questions or concerns you may have.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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