July 2 Former FBI Director Louis Freeh will
investigate possible misconduct by a lawyer involved in making
payments to settle claims by people and businesses affected by
the BP spill in the Gulf of Mexico in 2010, the judge in
the spill damages case said on Tuesday.
Freeh, who recently stepped down as trustee for collapsed
brokerage MF Global Holdings Ltd and previously led an internal
investigation into the Penn State University sex abuse scandal,
was named a "special master" by Judge Carl Barbier, who is
hearing the civil case over the spill in New Orleans federal
BP had called for an independent inquiry into an allegation
that a lawyer working for the administrator of the payments had
referred claims to a New Orleans law firm in exchange for a
share of subsequent settlement payments.
"The court has concluded that in order to ensure the
integrity of the program for the benefit of the parties and the
public, an independent, external investigation of this matter
should be performed," Barbier wrote in his ruling.
In a statement on Tuesday, BP welcomed Freeh's appointment
and said he had been granted "wide latitude" to look for other
possible misconduct within the Court Supervised Settlement
An internal probe by the CSSP is already under way, wrote
Barbier, who noted that Freeh's current firm, the Freeh Group,
had experience in conducting a wide range of investigations.
The trial under Barbier to determine blame and overall
damages from the Gulf spill is ongoing, while a U.S. appeals
court on July 8 is set to hear a case brought by BP about the
way payouts are being made by the CSSP.
BP has no control over its payments to claimants, having
agreed to a compensation formula and framework in a legal
settlement covering certain personal and business liabilities.
While the company insists the formula is being
misinterpreted, claims administrator Patrick Juneau disagrees,
and the process Juneau is leading has been upheld by Barbier.
The case under Barbier 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.
10-md-02179. 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.