Major Challenges To ‘Class Settlement’ Agreement in BP Oil Spill Disaster – Another Appellate Brief filed with 5th Circuit
Click here to download the pdf version of the Appellate Brief
A number of firms representing large blocks of victims of the oil spill filed their briefs in opposition to the class settlements in the BP oil spill litigation Friday. The briefs of the appealing claimants were due Friday in the Fifth Circuit Federal Court of Appeal in New Orleans, the appellate court with direct oversight of appeals emanating from several states along the Gulf Coast, including Louisiana, where the underlying litigation has for the most part been consolidated into one forum in front of Judge Carl Barbier in the Eastern District of Louisiana, located in New Orleans.
These appeals briefs were filed on behalf of wide ranging classes of victims of the spill, and likewise involve wide ranging issues of ethics, transparency, application of the law of class actions, and interpretation of the class settlement and definitions of eligible vs. ineligible claims. While the notices of appeal were filed months ago, the extensive and detailed briefs of the aggrieved movants shed much more light on the nature of the legal issues called into play and numerous specific issues the parties have faced in the class settlement process.
While the appeal involves thousands of victims of the oil spill, appeals of the class action interpretations have not been made exclusively by claimants. In fact, BP, a party to the agreement, was in front of the same appeals court last week arguing that the settlement was being interpreted by the claims administrator, Pat Juneau, in an improper manner.
The economic class settlement in this case is particularly unique in that it allowed claims to be submitted and reviewed even BEFORE it was approved, and BEFORE it withstood appellate scrutiny. The advantage to such an agreement from a practical standpoint is that it then provides a good history for an appellate court to see how the class has in fact performed, as opposed to how it will perform in theory. In this case, the majority of claims submitted have not been paid, and there are a number of other "ambiguous" components of the very unwieldy agreement that have left both sides frustrated. This in spite of the fact that the facility has been open for over a year. While BP on one hand says that claimants with no losses are being paid, claimants with losses from the spill are complaining they ARE NOT being paid, or that their claims are being grossly undervalued.
BP has engaged in a multi-million dollar advertising campaign vocalizing their complaints over the very agreement they entered into and castigating lawyers, politicians and claimants in the process. The only difference on that point is that BP can afford to take out full page ads in major newspapers around the world to express their complaints and the individual claimants do not have the resources to combat the propaganda of the BP public relations campaign. Through all of it, one must remember that this is the same BP that brought us Grangemouth, the Alaskan Pipeline Failures, the Texas City Refinery explosion and the SEC insider trading scandals. The same BP that has the highest worker fatality rate in the industry. The same BP that has bragging rights to accumulating the most fines for deliberate violations of OSHA regulations (more than the rest of the industry combined). The same BP that was ON CRIMINAL PROBATION for killing 15 workers in Texas when they killed 11 more in the Gulf of Mexico (as well as several more in between those two tragedies). The same BP that paid millions in golden parachutes to many of their chief executives in exchange for agreements to silence after the investigations into the cause of the Texas City explosion. The same BP that was caught literally putting a value on a human life in determining whether to implement a safety protocol. The same BP that literally compared workers to pigs in a cost/benefit analysis power point for management.
The briefs filed by BCA are on behalf of several thousand claimants. BCA filed the master appeals brief on their behalf and on behalf of the BCA legal partnership in the oil spill litigation, which involves dozens of individual law firms and claims facilities all along the gulf coast, from Texas through Florida.
The central theme to the BCA appeal is that the requirements for class certification have not been met and that the settlement should be remitted back to the trial court for further consideration. The BCA appeal also questions the scrutiny that was committed to the evidence in support of the class action and the counsel who were supporting the class settlement. The bottom line is that there were concerted efforts on the part of BP counsel and PSC members who were also designated to be class counsel to strike a deal that made it difficult for individual claimants to opt out of, and that did not produce the promised transparency, efficacy and fairness that was represented in the notice and presentment processes. Those concerns have now been borne out in the review of how individual cases have been treated in the submission process. Many cases that are eligible are not awarded any compensation. Many others are denied for not having every single supporting document that the claims administrators request. BP even complains, saying that ineligible cases are getting paid.