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Feedback: Rolled? BP? Really?


Re: “Spillapalooza: How BP Got Screwed in the Gulf” (Features, July 1-July 7, 2013): Paul M. Barrett’s story is correct—“BP (BP) faces an enormous obstacle: It agreed to the arrangements it now asserts are out of control.” However, the article mischaracterizes the terms of the Settlement Agreement and omits a great number of facts that illustrate the disingenuous nature of BP’s recent public-relations efforts, which are entirely divorced from reality.

When BP entered into the settlement negotiations in 2010 it was facing enormous governmental, legal, investor, and public pressure stemming from the utter lack of corporate integrity that led to the worst oil spill the world has known, the death of 11 men, unquantified environmental damage, and grave economic uncertainty.

Facing a trial and felony charges, it co-authored and agreed to the Economic Class Settlement and initially promoted the Settlement Program. Now that the felony charges are resolved (with BP using the settlement as leverage to negotiate reduced criminal fines and penalties) and the first part of the trial is over, laying bare BP’s gross negligence, BP is seeking a new way to save money.

BP’s recent money-saving effort has manifested itself as a propaganda campaign to scare eligible claimants out of filing claims they have every right to make. It is a hollow intimidation tactic—disingenuous, inaccurate, and inappropriate. The notion of BP trying to portray itself as a victim is preposterous.

The court has rejected BP’s argument multiple times. Simply put, BP guessed wrong on the cost of a deal, which it—for nearly two years—negotiated, co-authored, agreed to, and sought court approval of.

The Settlement Agreement states in explicit, painstaking detail—and was confirmed multiple times by BP—that if a claimant has a loss as defined by the Agreement’s objective formulas, the spill caused that loss. Period. End of story.

BP would have you forget what its attorney told the court when the company was seeking approval of the Economic Settlement: “Like any settlement, the settlement that has been reached to resolve this litigation is a compromise, a yielding of the highest hopes in exchange for certainty and resolution. The settlement stands alone, however, in its substantive generosity to the class members and in its procedural fairness.”

In fact, another of BP’s attorneys wrote: “One of the cornerstones of the Settlement Agreement is the use of transparent, objective, data-driven methodologies designed to apply clearly defined standards. … These methodologies and requirements were carefully negotiated by the parties and are set forth in the Settlement Agreement as mandatory requirements. Among other reasons, these methodologies and requirements were negotiated in response to concerns voiced by some that the prior GCCF [Gulf Coast Claims Facility] process was too dependent on accounting judgments that were not transparent.”

Moreover, in moving for the Settlement’s approval, BP stated in its Proposed Findings and Conclusions, “Once the causation tests are satisfied, all revenue and variable profit declines during the compensation period are presumed to be caused entirely by the spill, with no analysis of whether such declines were also traceable to other factors unrelated to the spill.”

It is important to remember that the transparent, objective formulas used to determine compensation are born, at least in part, out of the lessons learned under BP’s predecessor compensation program, the GCCF. The GCCF was obtuse, subjective, and unpredictable.

In fact, BP selected Pat Juneau as the administrator of the Court-Supervised Settlement Program. BP also selected the independent accountants who always interpreted the compensation formulas the exact same way that Mr. Juneau and the court did. Additionally, BP agreed that the compensation formulas be applied in a way that maximizes claimants’ recovery.

What has changed in the Settlement since BP extolled its virtues? Nothing. Not one word, period, or comma. The only change is that BP realized it underestimated the number of eligible claimants that would exercise the rights afforded to them by the Settlement Agreement.

BP didn’t get “screwed” or “rolled,” as Businessweek asserts. BP was warned that its $7.8 billion estimate was too low, yet it paid that warning no heed.

BP is used to being able to change the rules to suit its whims. Not in this case. A deal is a deal.
 
Stephen J. Herman and James P. Roy
Plaintiffs’ Co-Lead Counsel,
In
re: MDL-2179 Oil Spill by the Oil Rig Deepwater Horizon
New Orleans

 

Frankenwheat Explained

 
Being a wheat farmer in southeast Washington State, I’ve read many articles on the genetically modified organisms (GMO) wheat crisis. “Altered Waves of Grain” (Features, June 24-June 30, 2013) was right on. It stated the situation very accurately, explaining it well to people not associated with farming. It wasn’t done in an alarming mode, and the “tongue-in-cheek” angle was a nice touch. I’m sure we’ll all get over this soon. It’s even made the wheat industry a little sexy.
 
Darrell Bafus
Colfax, Wash.


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