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BP spill claims administrator urges dismissal of lawsuit

A logo on a British Petroleum petrol station is seen in London April 30, 2010. REUTERS/Toby Melville
A logo on a British Petroleum petrol station is seen in London April 30, 2010. REUTERS/Toby Melville

By Jonathan Stempel

(Reuters) - The administrator of BP Plc's settlement with thousands of people and businesses who sued over the 2010 Gulf of Mexico oil spill urged a federal judge on Monday to end the company's lawsuit over how he determines damages claims.

BP had last month urged U.S. District Judge Carl Barbier in New Orleans to issue an emergency order to stop court-appointed administrator Patrick Juneau from paying out "absurd" amounts based on inflated or fictitious claims.

The oil company originally expected the March 2012 class-action settlement to resolve economic and health claims by more than 100,000 individuals and businesses to cost $7.8 billion.

But damages are not capped, and BP's estimate of the cost grew to $8.5 billion by year end. It said Juneau's methods give him too much leeway to boost payouts, potentially by billions of dollars, and make payments for damage that never took place.

In Monday court filings, lawyers for Juneau said he deserves judicial immunity from being sued over his work, saying this immunity encourages "principled and fearless decision making" without the threat of interference from unhappy litigants.

The lawyers went on to say that even if Juneau were not entitled to this immunity, he was doing his job properly.

"Mr. Juneau, as the claims administrator and trustee, performed and continues to perform his official functions exactly as outlined in the settlement agreement" and other documents, Juneau's lawyers said.

BP said in a statement on Monday: "The claims administrator's misinterpretation of the settlement agreement inappropriately and unfairly compensates numerous businesses for wholly non-existent losses. Such a result is completely at odds with the parties' stated intent in reaching a settlement."

Juneau's filings came as Barbier prepares on Tuesday to resume a nonjury trial that began six weeks ago to determine liability for the April 20, 2010 rupture of the Macondo well and explosion of the Deepwater Horizon drilling rig.

The incident killed 11 people and triggered the worst offshore oil spill in U.S. history.

BP has estimated that it could spend more than $42 billion to cover clean-up, fines and other liabilities. It has been selling a variety of assets to help cover its costs.

As of April 1, more than 160,000 claims have been submitted under the Deepwater Horizon Economic and Property Damages Settlement, according to a website for the settlement.

About $1.82 billion of payments have been made on 26,580 claims, the website said.

The case is In re: Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.

(Reporting by Jonathan Stempel in New York; Editing by David Gregorio, Bernard Orr)

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