BP loses another round in its battle to stiff oil spill victims

The Deepwater Horizon burns on April 21, 2010. An engineer convicted of obstructing evidence in the spill will face a new trial after an investigation found one of his jurors had shared overheard information about the case.
(Gerald Herbert / Associated Press)

Oil giant BP this week extended its .000 batting streak in its effort to kill its own settlement in the Gulf of Mexico oil spill disaster, losing a bid to have the Supreme Court halt payments to spill victims while it stretched out its appeal.

The court’s ruling was as terse as it gets, a single sentence declaring that BP’s motion to continue a stay on damage payments was denied. Payments have now been resumed.

To recap: BP, which was responsible for the 2010 Deepwater Horizon oil rig disaster that took 11 lives and fouled the waters and the coastline of the gulf, has mounted an intensive PR and legal campaign to overturn a settlement of business damage claims it reached in 2012.


Its argument is that the terms of the deal allow businesses to claim oil spill damages even if they weren’t affected. Though it’s true that the standards of proof were streamlined to cut litigation costs, BP’s assertion that it’s being taken to the cleaners by thousands of canny, undeserving claimants is almost certainly inflated.

Nevertheless, its position was swallowed by “60 Minutes,” which last month produced a report on the controversy heavily slanted toward the oil company.

BP has fared much worse in court. Its efforts to overturn the settlement were rejected by a U.S. District Court in Louisiana and twice by the U.S. 5th Circuit Court of Appeals. Payments were stayed by the federal courts while BP’s appeals proceeded.

The company had asked the Supreme Court to continue the stay, and a few legal experts suggested that it might have an ace in the hole: a son of Justice Antonin Scalia, who rules on such applications from the 5th Circuit, is a partner at Gibson, Dunn & Crutcher, BP’s law firm in the case. As it turned out, Scalia dodged the appearance of a conflict of interest by referring the oil firm’s motion to the entire court.

In its reaction to the ruling, BP continued its PR campaign despite its apparent futility. “The company continues to believe that the lifting of the injunction ... will allow hundreds of millions of dollars to be irretrievably scattered to claimants whose losses were not plausibly caused by the Deepwater Horizon accident,” its spokesman, Geoff Morrell, told the Associated Press.

The company is down to one final Hail Mary pass, a full appeal of the 5th Circuit rulings to the Supreme Court. The company hasn’t yet made a motion, and it’s uncertain that the court would accept the appeal.

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