BP Oil Spill Claims Fund Administrator Accused of Bias

Lawyers representing plaintiffs in BP oil spill lawsuits are questioning the independence of Kenneth Feinberg, the attorney overseeing BP’s $20 billion oil spill compensation fund. Now, according to a report in The New York Times, they’ve asked US District Judge Carl J. Barbier, who is overseeing the consolidated BP oil spill litigation in New Orleans, to order Feinberg to be more ever-handed when he discusses Gulf of Mexico oil spill claims.

According to the Times, it is not clear that Judge Barbier has any jurisdiction over Feinberg, but the motion filed by the plaintiffs’ attorneys is important, in that it enters allegations of bias into the court record.

According to the Times, the plaintiffs’ attorneys are upset about comments like this from Feinberg:

“Why litigate? Why flood the federal and state courts of Louisiana? You’ll litigate for years. You’ll be paying all sorts of expenses. Who says you’ll win? If I won’t pay you, I urge, no one will pay you.”

That quote appeared in the New Orleans Time-Picayune earlier this fall.

The plaintiffs’ lawyers say Feinberg should be telling potential litigants that, if they go to court, they might be able to win punitive damages, lawyer fees and the opportunity to sue others involved in the spill, the Times said. In a motion filed in US District Court for the Eastern District of New Orleans, they asked Judge Barbier “to ensure that Mr. Feinberg’s public comments, and the language of the paperwork he uses to settle cases, are “clear, accurate and fair” to the people who might be able to sue. They also want Mr. Feinberg and his team to stop advising spill victims that they should not hire a lawyer,” the Times said.

The motion also questions Feinberg’s independence, noting his law firm is being paid $850,000 per month by BP to run the claims fund. They want this made clear to potential claimants, and say Feinberg should be identified as an employee of either BP or the federal government, the Times said. Since taking over the fund, Feinberg has insisted that he acts independently.

The BP oil spill began on April 20, 2010 with an explosion aboard the Deepwater Horizon oil rig that killed 11 men. Attempts to staunch the gusher failed, until a cap was successfully deployed over the undersea well on July 15. By that time, roughly 4.4 million barrels of oil had spilled into the Gulf of Mexico. The BP oil spill, which now ranks as the largest offshore oil disaster in US history, paralyzed important segments of the Gulf Coast’s economy, including seafood and tourism.

Over the summer, BP agreed to set aside at least $20 billion to pay economic loss and physical damage claims stemming from the BP oil spill. Businesses, individuals and government entities who suffered economic losses or physical injury as a result of the BP oil spill were eligible to file two types of claims: Emergency Advance Payments and long-term final damage claims. The deadline for filing emergency claims has passed. Claims forms for final payments must be submitted to the Gulf Coast Claims Facility by August 23, 2013.

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