Federal Court Upholds BP Settlement

Despite BP’s objections and attempts to further suspend payments in the Court-supervised Settlement Program, a Federal Appeals Court, on January 10, 2014, upheld Judge Barbier’s approval of BP’s 2012 multibillion-dollar settlement for businesses and residents who suffered losses from the massive 2010 oil spill in the Gulf of Mexico.

Throughout 2013, BP attempted to change positions regarding the settlement, complaining about the way the business claims were being handled and paid by the independent Claims Administrator they selected. Despite the requirement to satisfy objective tests in the Settlement Agreement based on geographic location, type of business, and revenue patterns, BP (contrary to its previous statements and filing) started to argue that the settlement should not compensate businesses that could not directly link their losses to the Spill by some undefined and subjective measure. The Appeal Court panel released its 48-page majority opinion rejecting BP’s arguments and objections, thus affirming Barbier’s initial approval of the settlement in 2012.

Plaintiffs’ lawyers have argued that BP simply undervalued the settlement and underestimated how many claimants would be eligible for payments. “Today’s ruling is an enormous victory for the Gulf, and an important step forward in ensuring that every eligible claimant is fully compensated according to the objective, transparent formulas spelled out in the settlement agreement that BP co-authored and agreed to,” says Steve Herman, who serves as co-lead counsel for the plaintiffs and helped to negotiate the settlement in 2012.



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