BP takes latest arguments over spill payments to appeals court

HOUSTON – BP is again asking a New Orleans appeals court to intervene after a federal judge denied its latest attempt to block some payments in its multibillion-dollar oil spill settlement.

On Tuesday, U.S. District Judge Carl Barbier tossed the British oil giant’s argument that settlement claimants must show that the 2010 Gulf of Mexico disaster actually caused profit or revenue losses, and BP promised to take the matter to a higher court.

Barbier said BP could not take a position that contradicted its earlier stance in the settlement. He cited court documents in which BP said businesses’ profit losses can be “presumed to be caused by the spill” after claimants meet certain criteria, such as geographic proximity to the spill.

BP filed a notice of appeal Thursday. In court documents, BP claimed last month it paid more than $540 million to claimants who could not have been harmed by the spill. All told, the company has paid out $3.8 billion to claimants since the settlement was forged last year., according to Patrick Juneau, the claims administrator.

“Awarding money to claimants with losses that were not caused by the spill is contrary to the language of the settlement and violates established principles of class action law,” said BP spokesman Geoff Morrell in an emailed statement Tuesday.

The 5th U.S. Circuit Court of Appeals has sided with BP on the issue before. Earlier this month, a three-judge panel ordered Barbier to revisit the possibility of making businesses prove economic losses were tied to the spill.

“The district court erred by not considering the arguments on causation,” the appeals court wrote Dec. 2.

But trying to determine whether each loss is also affected by events other than the oil spill is “a very difficult task,” said Brian LeCesne, a Loyala University law professor who has followed the case in New Orleans.

“What’s so potentially devastating about the 5th Circuit’s ruling is that they were compelling a judge to rewrite an iron-clad agreement,” LeCesne said.