BP victory as court caps compensation to oil spill victims
The 5th US Circuit Court of Appeals court has sided with BP, in agreeing that the compensation to be paid to victims of the Gulf of Mexico oil spill needs will be capped. The court concluded on wednesday night that the agreement reached last year would need to be altered, with stricter conditions on those who will be eligible for compensation. The court said that BP shareholders should not be punished by allowing "hundreds of millions of dollars of unrecoverable awards."
BP spokeman Geoff Morell said:
BP is extremely pleased with today's ruling… setting aside the claims administrator's interpretation of the business economic loss framework in the settlement agreement BP reached with the Plaintiffs' Steering Committee last year.
The explosion at the Deepwater Horizon drilling rig resulted in the deaths of 11 people and the largest offshore oil spill in US history. BP had agreed last year to settled in a deal it forecast would cost the company £5.2bn in compensation. But due to the volume of claims being made, up to 10,000 per month. The BP since last year has repeatedly revised up its estimates of compensation.
District judge, Carl Barbier who presided over the compensation committee was instructed to produce a narrower set of criteria in order to compensate victims with "actual injury" and exclude frivolous claims which were being awarded under the broader criteria.
Stephen Herman, who acts as legal representative for some victims speaking after the decision said:
We're pleased that the vast majority of class members will continue to be paid in a timely and expeditious manner. We look forward to working with the claims administrator and the court to determine the best way to get the affected claims processed and paid as soon as possible.
