By Margaret Cronin Fisk
28 August 2013
(Bloomberg) – BP Plc lost a renewed bid to suspend payments from the court-supervised program administering its settlement of claims tied to the 2010 Gulf of Mexico oil spill.
An investigation of alleged wrongdoing at the Mobile, Alabama, claims assistance center didn’t find “any credible evidence of fraud,” U.S. District Judge Carl Barbier in New Orleans said today.
He also rejected BP’s allegations that its ability to appeal payments was tainted because, the company said, “at least two appeal panelists had apparent conflicts of interest.” The issue earlier was brought to Magistrate Judge Sally Shushan, who investigated and is handling the matter, Barbier said.
“None of the claims represented by the firms of two of the panelists have been approved, paid or appealed,” Barbier said today, referring to law firms. The “alleged conflicts” are not “a basis upon which to suspend the entire claims payment program,” he said.
Barbier last month rejected the company’s request to stop the payments while Louis Freeh, former director of the Federal Bureau of Investigation, probes allegations of misconduct in the claims program. BP renewed the request Aug. 5. […]
“We’re pleased that the court relied on actual facts and evidence in reaching its conclusion -- for the second time -- and not the unsupported hyperbole and speculation propagated by BP,” Stephen Herman and James Roy, co-lead attorneys for the plaintiffs suing the company, said in an e-mailed statement.
Freeh was appointed after an attorney at the Deepwater Horizon Court Supervised Settlement Program was suspended and accused of accepting fees from law firms while processing their clients’ claims from the oil spill. Another attorney was subsequently suspended following similar allegations.
BP faces thousands of lawsuits over damages caused by the explosion and sinking of the Deepwater Horizon rig in 2010. The blast killed 11 workers and released more than 4 million barrels of crude from BP’s well off the Louisiana coast.
BP reached the agreement with most private party plaintiffs last year, initially estimating the cost of the settlement at $7.8 billion. The company has since raised the estimate to $9.6 billion. [more]