US makes final pitch to Gulf oil spill judge to hit BP, others with punitive damages

BP’s spread-the-blame strategy is evidence of a corporate culture at the British oil giant that caused the 2010 Gulf of Mexico oil spill, the U.S. government said in a court filing Friday that is likely its final push to encourage a federal judge to make the company subject to billions of dollars in punitive damages.

Both the Justice Department and BP filed reply briefs in federal court in New Orleans to closing arguments that all the parties had previously filed following the first phase of a civil trial that ended in April.

U.S. District Judge Carl Barbier is weighing the critical question of whether well owner BP, rig owner Transocean and cement contractor Halliburton were grossly negligent in connection with the rig explosion and oil spill off the coast of Louisiana.

If he rules in favor of the government, Gulf states and private plaintiffs suing the companies, that would open the firms up to punitive damages. In BP’s case, it also would subject the company to the possibility of maximum fines under the Clean Water Act.

Barbier hasn’t said when he will rule on the gross negligence issue. The second phase of the trial, which will address the issue of how much oil spilled, is set to begin in September.

In its latest filing, the Justice Department said BP’s assertions during the trial and in its closing arguments after the trial strike familiar themes.

“While the work may have been bad, it was not that bad; while it is nice to do things properly, shortcuts do not matter in the end; while BP was technically in charge, everything was really someone else’s fault; sometimes accidents happen. This corporate culture is what caused the blowout and spill,” government lawyers said.

The government said that even if BP could disregard the acts of its managers and pin all of the blame on rogue employees or contractors, it would not absolve itself of liability.

“The United States has in fact established that the spill resulted from, and was proximately caused by, BP management,” the government said.

In its final reply brief, also filed late Friday, BP said that if the trial so far has shown anything it is that deepwater drilling is dangerous business and unpredictable things can happen when multiple parties are making decisions.

“It is easy — particularly with the benefit of hindsight — to second-guess any number of those decisions,” BP said. “And that is precisely what the government and plaintiffs want this court to do.”

But BP argued that the blowout was an accident that occurred as a result of the successive failure of a series of state-of-the-art barriers on its Macondo well. It said it does not deny it played a role in those failures, but BP believes that should not subject it to a gross negligence finding.

“At the end of the day, the only relevant facts are those with a causal link to the blowout,” BP said. “And when those facts are reviewed against the controlling law, there is no basis to subject BP to either treble fines or punitive damages.”