Home -> Law Blog Directory -> Legal News Blogs -> JURIST - The Paper Chase

Legal News

: JURIST - The Paper Chase

BP, DOJ complete negotiations on $20 billion oil spill victim fund

By Daniel Richey

[JURIST] British Petroleum (BP) [corporate website] and the US Department of Justice (DOJ) [official website] on Monday announced [DOJ press release; BP press release] the completion of negotiations over the implementation of a $20 billion fund [JURIST report] to aid victims of the Deepwater Horizon oil spill [BBC backgrounder; JURIST news archive] in the Gulf of Mexico. The White House has tapped Washington lawyer and special master for compensation Kenneth Feinberg [WP profile] to manage claims from the fund. BP has appointed two trustees to administer the fund, former US district judge for the Southern District of New York [official website] John Martin and Washington University Law School [academic website] dean Kent Syverud [official profile]. Associate Attorney General Tom Perrelli stressed that, while the deal is an important first step to compensating victims of the spill, much work has yet to be done:

We are pleased that BP made an initial contribution and has taken an important step toward honoring its commitment to the President and the residents and business owners in the Gulf region. We have made clear that the company still needs to ensure that the necessary funds will be available if something happens to the subsidiary that established the trust and we look forward to completion of an appropriate security arrangement in the near future.

At the completion of the deal, BP made a $3 billion initial deposit into the fund, with another $2 billion planned for the fourth fiscal quarter of 2010.

Numerous lawsuits are pending against BP in connection with the Deepwater Horizon spill. In July, a class-action lawsuit [complaint, PDF; JURIST report] was filed against the company in a Louisiana state court alleging that the its negligent actions led to the spill and that BP was further negligent in its oversight of the cleanup effort, resulting in volunteers falling ill due to inadequate protective equipment. In June, two lawsuits were filed against BP [JURIST report] alleging violations of the Racketeer Influenced Corrupt Organizations (RICO) [18 USC § 1961 et seq.] statute. The lawsuits allege that BP purposefully defrauded the American public in order to increase company profits. Also in June, Attorney General Eric Holder [official website] announced that the DOJ is reviewing whether any civil or criminal laws were violated [JURIST report] by BP resulting in the oil spill. Holder cited several statutes being examined by government lawyers, including the Clean Water Act and the Oil Pollution Act of 1990 [materials]. In May, DC-based consumer advocacy organization Food and Water Watch (FWW) [advocacy website] filed suit [JURIST report] in a US district court against the US Department of Interior (DOI) and the Minerals Management Service (MMS) [official websites] for an injunction to halt drilling at BP's Atlantis facility, another Gulf of Mexico site.

Full post as published by JURIST - The Paper Chase on August 09, 2010 (boomark / email).