Judge Denies BP’s Attempt to Suspend Gulf Spill Payouts Pending Fraudulent Claims Investigation

Posted in BP British Petroleum,Deepwater Horizon,Louisiana Maritime News,Maritime Lawsuits on July 22, 2013

According to a Reuters article dated July 19, a federal judge denied oil giant BP’s attempt to suspend payments related to the 2010 Gulf of Mexico oil spill from the Deepwater Horizon explosion, while fraudulent claims are being investigated from the payout fund. The appeal is “BP Exploration & Production Inc et al. vs Lake Eugenie Land & Development Inc, et al.” in the U.S. Court of Appeals for the Fifth Circuit, No. 13-30329.

Judge Carl Barbier, who has been the presiding judge over the spill-related civil case against BP and its contractors, ruled on Friday that there was nothing to prove the “mass of claims” was not being properly evaluated.

“BP has not produced any evidence that would warrant the court taking the drastic step of shutting down the entire claims program,” said Barbier, who frequently interrupted BP lawyer Jeffrey Clark in the New Orleans courtroom as he pressed him for specific evidence of the claims process being compromised.

Judge Barbier also made a point of speaking out against a BP “media frenzy” and widely reported “misinformation” about claims administrator Patrick Juneau being selected by the court when he had actually been proposed by all the parties, including BP.

BP spokesman Geoff Morrell released a statement following Judge Barbier’s ruling stating the oil giant believed the ruling was “wrong under the law” and that a pause of all claims payments was prudent and necessary during former FBI’s Freeh’s investigation.

“There is a material risk that payments going out the door have been and continue to be tainted by possibly fraudulent or corrupt activity,” Morrell said, adding that BP should not bear the risk of improper payments before Freeh completes his probe.

In his summation, Barbier took particular issue with BP’s attempts to influence public opinion through its media campaign, and praised Juneau for his “commendable” performance.

“I will continue to try this case in the courtroom and not in the press,” Barbier said. “I certainly have no intention of allowing a media frenzy to cause me to shut down the entire settlement … BP has failed to make such a showing and accordingly it’s ordered that the motion is denied.”

The trial under Barbier to determine blame and overall damages from the spill is ongoing. It is in re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.

Source: Reuters

Blog post by Louisiana maritime lawyer, Gordon, Elias & Seely.