Judge delivers harsh retort to BP’s request to halt oil spill payments

In a blistering rebuke of BP’s criticism of the administrator who is processing claims from last year’s multibillion dollar Gulf oil spill civil settlement, a federal judge Friday scolded the company for its public attacks and quickly rejected its request to halt payments to victims of the disaster.

U.S. District Judge Carl Barbier in New Orleans said BP’s personal attacks on claims administrator Patrick Juneau have been “offensive,” and he especially noted that he didn’t care for comments the chief executive of the company, Bob Dudley, made on CNBC on Thursday. Dudley said the settlement had been “hijacked” by the administrator’s office.

“Mr. Juneau is not a good ol’ boy plaintiffs attorney as some have suggested,” Barbier said at the hearing, which was accessible via a telephone dial-in number.

BP had asked for an injunction to halt payments from the settlement until an independent investigation of Juneau’s office has been completed.

While Barbier noted that probe is continuing, he believes Juneau himself has acted with the highest level of integrity, and he noted that both BP and the plaintiffs attorneys who negotiated the settlement had selected Juneau.

BP said in a statement it is dissappointed by Barbier’s ruling. It said it would review its available legal options. There was no immediate comment from the plaintiffs attorneys on Barbier’s decision.

BP claims that two of the three senior legal counsel to Juneau’s office were fired recently after apparently intervening in the processing of claims in which they appear to have had a financial stake.

BP says that because those individuals were in a position to influence nearly every policy decision or claim determination by the settlement program, there is a risk that other aspects of the claims process have been compromised.

BP had asked that all claims payments be halted until former FBI Director Louis Freeh’s investigation is complete. Barbier had ordered the probe, but had noted that he was doing so to maintain integrity in the claims process. The judge has not said he has found any corruption.

Attorneys for victims of the oil spill opposed BP’s request for an injunction.

The lead attorneys for a steering committee that negotiated the settlement with BP on behalf of thousands of victims said BP has not identified a single claim that it contends was tainted or otherwise affected by an alleged conflict of interest involving the lawyers who used to work for the settlement program.

They said that based on the existing record, allegations involving the former staffers appear to represent a limited and isolated situation, to which the claims administrator immediately and appropriately responded.

So far, Juneau has offered about $4 billion to victims of the disaster off Louisiana.

Juneau’s attorney noted that Juneau already has placed on hold those claims with any remote connection to the parties under investigation.

Juneau has previously said he will continue to administer settlement payments as he has been until he is told otherwise by the court.

BP, meanwhile, is awaiting a decision by a federal appeals court on its challenge of the way business economic loss claims are being handled by Juneau’s office.