Oil Spill Business Claims Halted in Surprising New Ruling
Between April and September of 2013, over 5,000 businesses were paid over $1.3 billion in settlement claims. However, since the U.S. 5th Circuit Court of Appeals recently ruled, the Claims Administrator, Patrick Juneau, has paid only four business loss claims in the two months.
In addition to a claim process stand-still, the Court issued a surprising ruling this week, a three-judge panel of the 5th Circuit has given BP even more than it previously asked for by demanding that District Judge Barbier block any further payments to businesses whose “injuries are not traceable to the spill.” In essence, BP wants claimants to prove the one element that was never, until now, an issue: causation. It is the next strategic move for BP to undermine the settlement process. If BP has its way, each and every business that files a claim (tens of thousands of claimants) would have to provide specific and actual proof that its business was harmed by the oil spill.
Judge Barbier previously rejected BP’s arguments to require proof of causation because it would be virtually impossible. BP, of course, knows this. How could any business definitively say that it made less money over three years ago because of the spill and not for some other reason? This is why the settlement agreement was specifically constructed to dispense with that requirement. And, it should be noted that BP knew this and, in open court, acknowledged that it was “presuming causation”. Alas, that was before the value of the claims process was 8 billion dollars and rising.
Then, on December 2, 2013, the Fifth Circuit ruled that Judge Barbier erred by not considering BP’s arguments on causation. The panel remanded the issue of causation and ordered Judge Barbier to craft a stay tailored so those who experienced “actual injury traceable to loss” from the Deepwater Horizon accident can continue to receive recovery but those who did not, do not receive any payments until the case is fully heard and decided through the judicial process.
The Judge said that the Claims Administrator may continue to accept BEL claims and process said claims, but shall temporarily suspend the issuance of final determination notices and payments of BEL claims, pending resolution of the BEL issues that are the subject of the pending remand. This suspension also applies to claims currently in the claims appeal process.
As a practical matter, what does this mean? Legally, not all claims are stayed, only those which cannot show actual injury traceable to loss. However, as stated above, being able to prove that is extremely difficult. In essence, the vast majority of the Economic Business Claims have been stayed for the time being. We will not know how this will play-out until more of the BP Settlement saga unfolds. Stay tuned…
Link: http://www.wwltv.com/news/BP-
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