Monroe County residents and businesses with pending British Petroleum claims received good news on Jan. 10. The 5th U.S. Circuit Court of Appeals affirmed a federal judge’s approval of the multibillion-dollar Deep Water Horizon Class Action Settlement Agreement. BP had challenged the constitutionality of the settlement agreement, but the trial and appellate court have now rejected the challenge. BP has now asked for the entire 5th Circuit to review the decision, so for now the claims process will remain stalled.
“We are encouraged by last week’s opinion that disagreed with BP’s appeal,” said John Campbell of Campbell and Malafy law offices in Marathon, “that would have eviscerated the settlement agreement in its entirety.”
On several occasions in 2012, BP asked the trial court to approve the class action settlement. The settlement agreement stipulated how private citizens and businesses would be reimbursed for losses they suffered from the oil spill.
Then in February 2013, BP entered into a plea agreement with the Justice Department. The plea bargain ensured, among other objectives, that no high level BP executives would be charged with a federal crime.
With the plea bargain behind it, BP switched course and attacked the Settlement Administrator, his implementation of the agreement and the agreement itself.
In the fall of 2013, BP asked the trial court overseeing the class action settlement to “decertify” the class alleging among other things that the settlement agreement violated Article III of the United States Constitution. Although the trial court refused, BP appealed to the Fifth Circuit and that appellate court imposed a stay effectively shutting down the claims process.
“The people waiting for money from BP are in limbo. Theoretically, the time for filing a claim expires in April,” Campbell said. “What is the court going to do? We just don’t know.”
BP initially estimated that it would pay roughly $7.8 billion to resolve the claims. Now, it claims the amount will be higher, but declines to say how much higher. Opposition lawyers have called BP’s position “buyer’s remorse.”
The 5th Circuit agreed with lawyers for claimants and said:
“No case cited by BP or the Objectors suggests that a district court must also safeguard the interests of the defendant, which in most settlements can protect its own interests at the negotiating table,”
BP has filed multiple challenges to its own settlement agreement, which remain pending.