Bloomberg News

BP Judge Sets May Conference on $7.8 Billion Settlement

March 17, 2012

The first BP Plc (BP\) trial plan conference after a private plaintiffs’ settlement with an estimated value of $7.8 billion will be held May 3 to discuss environmental claims related to the 2010 Gulf of Mexico spill.

U.S. District Judge Carl Barbier in New Orleans concluded yesterday that “a further status conference should be conducted following the filing of the proposed class settlement,” according to a court filing. The details of the proposed settlement must be filed by April 16, the judge ordered.

The judge will meet behind closed doors in his chambers with lawyers from BP and Transocean Ltd. (RIG), owner and operator of the Deepwater Horizon drilling rig involved in the spill, along with attorneys for federal and state governments.

BP said March 2 it would pay an estimated $7.8 billion to resolve private plaintiffs’ claims for economic loss, property damage and injuries. The settlement, to be paid from a $20 billion trust for spill victims set up in 2010, doesn’t resolve federal and state government environmental damage claims. BP has set aside $37 billion to cover spill costs.

BP may face as much as $17.6 billion in civil pollution fines under the U.S. Clean Water Act, based on the government’s estimate of barrels spilled.

That law provides for fines of as much as $1,100 for each barrel of oil spilled as a result of simple negligence, often described as a failure to exercise ordinary care. The maximum fine would increase to $4,300 a barrel if BP or the other defendants are found to have been grossly negligent, meaning a conscious action or omission caused the spill.

The case is In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporters on this story: Jef Feeley in Wilmington, Delaware, at jfeeley@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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