Sorry BP, Your Oil Spill Settlement Is Legal
Last Friday, a three-judge panel of the Fifth Circuit appeals court in New Orleans came to a decision that will change the course of BP’s (NYSE:BP) fight over the manner in which victim compensation claims for the 2010 Gulf of Mexico oil spill are determined. That ruling held that the settlement of a class action brought by Gulf Coast businesses who endured the months-long oil leak that befouled beaches, killed wildlife, and disrupted the economies of their state was legal.
The judges stated there was “no merit” in the company’s argument that a deal allowing businesses unaffected by the Deepwater Horizon disaster to claim compensation should be illegal. Plaintiffs’ lawyers took that decision as a victory; it upheld a pact worked out by the company’s own lawyers and stymied BP’s efforts to rewrite history and the settlement.
However, BP will continue to pursue its secondary argument: the court’s interpretation of the settlement agreement. In recently-filed court documents obtained by the Financial Times, BP said the company would “continue to press its position on the agreement’s threshold requirements that claimants’ losses must be traceable to the spill.” The papers also noted that “BP is shining a light on the abuses of the settlement and fighting to ensure that the agreement is implemented in accordance with its intended purpose and express language.”