Judge throws out RICO claims vs. BP *update*

A federal judge has dismissed racketeering claims brought by Gulf Coast businesses and residents against BP for last year’s massive oil spill.

The plaintiffs alleged that BP defrauded regulators in connection with the safety of its drilling operations and its response to the spill. They used the RICO Act, a law originally used to go after organized crime and drug dealers.

U.S. District Judge Carl Barbier dismissed the claims Friday. The decision does not affect other damage claims still pending from the same plaintiffs.

The judge also set aside a lawsuit filed against BP by Anadarko Petroleum, one of its partners on the Macondo well, saying the two companies’ prior contractual agreements required them to first try and settle such disputes through arbitration.

Anadarko argued that BP had voided that requirement by making discovery demands of Anadarko and taken other measures.


“We respect today’s decision, which does nothing to diminish our claims; it simply addresses the venue in which they may be resolved,” said Anadarko spokesman John Christiansen in a statement.

Anadarko has not previously set aside funds to account for possible spill related liabilities, but has said during analyst meetings that is has up to $3.4 billion in cash on hand and a $5 billion credit line that was acquired following the accident that remains unused. BP has set aside more than $40 billion in reserves.

BP declined to comment on the ruling, but reiterated its past criticism of Anadarko’s position.

“Anadarko has blatantly disregarded its responsibilities to the residents of the Gulf Coast by failing to pay its fair share of the costs relating to the accident and resulting spill,” the company said in a statement. “BP remains focused on ensuring that Anadarko lives up to its obligations as a co-leasehold owner of the Macondo prospect and as a ‘responsible party’ under [the federal Oil Pollution Act].”


Both rulings can be seen below:

2011 July BP Anadarko Arbitration Ruling

2011 July BP Civil RICO Dismissal