By Kathy Finn
NEW ORLEANS, July 19 A federal judge denied an
attempt by BP Plc to suspend payments to people and
businesses claiming damages related to the 2010 Gulf of Mexico
oil spill, while an investigator looks into possible misconduct
in the payout process.
The payments are being made under a program set up under a
settlement BP signed last year. Judge Carl Barbier, who is
overseeing the consolidated spill-related civil case against BP
and its contractors, ruled on Friday that there was nothing to
prove the "mass of claims" was not being properly evaluated.
"BP has not produced any evidence that would warrant the
court taking the drastic step of shutting down the entire claims
program," said Barbier, who frequently interrupted BP lawyer
Jeffrey Clark in the New Orleans courtroom as he pressed him for
specific evidence of the claims process being compromised.
Barbier also made a point of speaking out against a BP
"media frenzy" and widely reported "misinformation" about claims
administrator Patrick Juneau being selected by the court when he
had actually been proposed by all the parties, including BP.
Earlier this month, Barbier named former Federal Bureau of
Investigation director Louis Freeh as a "special master" to
investigate possible misconduct in the claims program.
Last month, Juneau placed team member Lionel Sutton on
administrative leave and filed a report to Barbier about Sutton
being accused of referring claimants to other lawyers in
exchange for a cut of subsequent compensation. Juneau later said
Sutton had resigned and that an internal probe had been
launched. Sutton's wife, who worked in Juneau's office, also
Under its settlement signed last year, BP agreed to a
compensation formula and framework covering certain personal and
business liabilities. The company insists the formula is being
misinterpreted, but Barbier has already ruled against BP, which
has appealed. A U.S. appeals court is considering the case.
Rick Stanley, who represents Juneau and the claims
administration office, said BP's injunction request on Friday
was premature given the internal and external investigations
were open. He said nothing suggested the lawyers whose actions
prompted the probes had influence over claims calculations.
"WRONG UNDER THE LAW"
In a statement released after Barbier ruled, BP spokesman
Geoff Morrell said the company believed Barbier's ruling was
"wrong under the law" and that a pause of all claims payments
was prudent and necessary during Freeh's investigation.
"There is a material risk that payments going out the door
have been and continue to be tainted by possibly fraudulent or
corrupt activity," Morrell said, adding that BP should not bear
the risk of improper payments before Freeh completes his probe.
According to the official program website, more than 200,000
claims of all types have been filed, and more than $4.1 billion
worth have been deemed eligible for payment, which is more than
half of the money BP set aside for payments. The process is due
to run until next April.
On Friday, Barbier criticized BP Chief Executive Bob Dudley
for saying in a televised interview that Juneau had 'hijacked'
the settlement program. Barbier called the accusation "offensive
and inappropriate language, especially coming of all things from
the chief executive of one of the parties to the settlement
Barbier said the claims process, by design, required many
layers of review for each claim by lawyers, accountants and
supervisors in the claims administrator's office, and that all
the parties could review every decision. BP, therefore, had no
reason to request a halt to the process, he said.
In his summation, Barbier took particular issue with BP's
attempts to influence public opinion through its media campaign,
and praised Juneau for his "commendable" performance.
"I will continue to try this case in the courtroom and not
in the press," Barbier said. "I certainly have no intention of
allowing a media frenzy to cause me to shut down the entire
settlement ... BP has failed to make such a showing and
accordingly it's ordered that the motion is denied."
The trial under Barbier to determine blame and overall
damages from the spill is ongoing. It is in re: Oil Spill by the
Oil Rig "Deepwater Horizon" in the Gulf of Mexico, on April 20,
2010, U.S. District Court, Eastern District of Louisiana, No.
The appeal is "BP Exploration & Production Inc et al. vs
Lake Eugenie Land & Development Inc, et al." in the U.S. Court
of Appeals for the Fifth Circuit, No. 13-30329.