Bloomberg News

BP Workers’ Refusal to Talk Warrants Penalty, U.S. Says

October 13, 2012

Three BP Plc (BP/) executives’ refusal to testify about the 2010 Gulf of Mexico disaster should be held against the company at a multibillion-dollar trial over liability for the worst offshore oil spill in U.S. history, prosecutors said.

Mark Hafle, BP’s senior drilling engineer; Brian Morel, a drilling engineer; and Robert Kaluza, the well-site leader, were the London-based company’s direct chain of command over the well that blew out off the Louisiana coast in April 2010. All three have invoked their constitutional right not to testify on the grounds that it might incriminate them.

Federal prosecutors yesterday asked a federal judge in New Orleans to rule that BP can be penalized at trial for the workers’ silence, citing the three employees’ refusal to answer specific questions about why they allegedly ignored warning signs and continued to drill and complete the well in violation of industry safety standards and government regulations.

“It was the well site leader and drilling engineer’s responsibility to ensure that the proper tests were completed before the cement was run, correct?” a lawyer asked Kaluza under oath in a pretrial deposition, according to yesterday’s filing. “You could not simply rely on the contractor, could you?”

‘Company Men’

Kaluza, who was one of two BP “company men” on duty aboard the Deepwater Horizon drilling rig, declined to answer.

“You never ran any additional tests to determine the casing integrity or whether, in fact, something had ruptured higher up, did you?” the lawyer asked, saying that Kaluza had expressed concern about a possible rupture or hole.

Kaluza again refused to answer, according to the filing.

The government asked that the court “draw adverse inferences” based on the witnesses’ refusal to testify. This would mean that the judge, who is hearing the civil case without a jury, could assume that whatever testimony the BP workers’ might have provided would have been unfavorable to the company.

Shaune Clarke, Kaluza’s lawyer, Mitch Lansden, Hafle’s attorney, and Bill Taylor, who represents Morel, didn’t return calls seeking comment yesterday on the request by prosecutors.

BP said in a filing that it would rather the judge not penalize any of the companies involved in the spill for their employees’ refusal to testify.

“The inferences sought by other parties essentially amounted to counsel’s wish list of facts not otherwise established by the evidence,” Don Haycraft, BP’s lawyer, said in the filing. Drawing adverse inferences from employees’ silence, he said, would “improperly grant opposing counsel carte blanche to establish whatever facts they wished with regard to the events that led to the sinking of the Deepwater Horizon and resulting oil spill.”

Drilling Rig

The nonjury trial over liability for the explosion of the Deepwater Horizon drilling rig and the subsequent oil spill is set for Jan. 14 before U.S. District Judge Carl Barbier in New Orleans. Kaluza and the other BP employees were called as witnesses in the lawsuits over the spill.

The blowout and explosion on the Deepwater Horizon killed 11 workers and prompted hundreds of lawsuits against BP; Transocean Ltd. (RIG:US), the Vernier, Switzerland-based owner and operator of the rig; and Halliburton Co. (HAL:US), which provided cementing services.

The U.S. government also sued BP, Transocean and BP’s partners in the well, Mitsui & Co. (8031)’s MOEX Offshore 2007 and The Woodlands, Texas-based Anadarko Petroleum Corp. (APC:US), alleging violations of federal pollution laws. Louisiana and Alabama sued as well. MOEX has settled the federal pollution claims.

$7.8 Billion Settlement

BP reached an estimated $7.8 billion settlement with most private party plaintiffs in March. The plaintiffs’ and government claims against BP’s contractors involving the Macondo well remain.

Prosecutors also asked the judge to draw adverse inferences against 11 other drilling personnel associated with the Deepwater Horizon, who worked either for Transocean, or for Halliburton and its Sperry-Sun drilling measurement unit, who were providing cementing services to the well.

Transocean also asked the court yesterday to draw adverse inferences from the refusal to testify of BP employees Hafle, Kaluza and Morel. Transocean had earlier sought such a ruling on Hafle; the company asked for “additional adverse inferences” yesterday.

Cementing Decisions

“These witnesses had substantial responsibility at BP over the Macondo well,” Transocean said in yesterday’s filing. The unanswered questions “relate to these witnesses’ mishandling of cementing decisions on behalf of BP and to their mishandling of the negative pressure test on April 20, 2010.”

Transocean has contended that BP personnel ignored a potentially flawed negative pressure test before the well blew.

Halliburton also asked the judge yesterday for adverse inferences against seven witnesses it claims “increased the risk of a blowout occurring” by disregarding danger signs and deviating from standard drilling procedures. These included the three BP employees and four Transocean employees who were working onboard the Deepwater Horizon at the time of the blast.

If the judge grants the other parties’ requests for adverse inferences, then BP, in its filing, seeks the same against nine Transocean rig workers and a Halliburton cementing employee, all of whom BP claims should have known the rig crew wasn’t following proper drilling procedures.

Health Concerns

Donald Vidrine, the BP company man on duty at the time of the explosion, also has refused to answer all questions, citing health concerns, not his constitutional right against self- incrimination. The government didn’t mention Vidrine in yesterday’s filing.

“To date, Vidrine has refused to testify due to alleged health issues,” Transocean said in its filing.

Ellen Moskowitz, a BP spokeswoman, didn’t respond to a call and e-mail seeking comment on the filings. Beverly Stafford, a Halliburton spokeswoman, declined to comment on the filings.

Lou Colasuonno, a Transocean spokesman, didn’t return phone and e-mail messages seeking comment yesterday on the filings. Robert Habans, Vidrine’s lawyer, didn’t respond to voice and e- mail messages seeking comment on the government’s request.

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: Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net; Laurel Brubaker Calkins in Houston at laurel@calkins.us.com

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


Burger King's Young Buns
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • RIG
    (Transocean Ltd)
    • $41.48 USD
    • -0.59
    • -1.42%
  • HAL
    (Halliburton Co)
    • $72.64 USD
    • -0.77
    • -1.06%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus