Court Approves Settlement in BP Oil Spill Class Action Lawsuit

Defense.gov_photo_essay_100506-N-6436W-023.jpgA federal appellate court approved class certification and a settlement in a class action lawsuit based on the 2010 explosion and oil spill on an oil drilling rig operated by British Petroleum (BP) in the Gulf of Mexico. In re Deepwater Horizon, et al, No. 13-30095, slip op. (5th Cir., Jan. 10, 2014). The spill led to several hundred lawsuits by individuals and businesses claiming property damage, and by individuals claiming personal injury. The recent ruling rejected a request by BP to vacate the district court order approving the settlement. While this ruling specifically involves claims for property damage, BP’s claims and the court’s ruling could also apply to personal injury class actions.

BP operated, Deepwater Horizon, an exploratory oil drilling rig in the Gulf of Mexico, about forty miles south of Louisiana. The rig was drilling a well located at a depth of about 5,100 feet underwater. On April 20, 2010, a pocket of methane gas rose into the rig, ignited, and caused an explosion that killed eleven workers and injured over a dozen. Oil flowed from the well directly into the Gulf for almost three months releasing an estimated 205 to 210 million gallons. Oil washed ashore in Texas, Louisiana, Mississippi, Alabama, and Florida, resulting in widespread reports of injured and dead wildlife, property damage, and health problems among residents of the affected areas.

BP was named as a defendant in hundreds of lawsuits. The Judicial Panel on Multidistrict Litigation (JPML) consolidated many of the claims in In re Oil Spill by the Oil Rig “Deepwater Horizon,” No. 2:10-md-02179 (E.D. La.), in August 2010 in order to address common issues as efficiently as possible. BP established a fund to pay claims known as the Gulf Coast Claims Facility (GCCF), which would eventually pay out over $6 billion. Starting in 2011, the company negotiated with the plaintiffs in the JPML case to transfer claims from the GCCF to a court-supervised fund.

The district court hearing the JPML matter approved a settlement agreement between BP and the plaintiffs’ representatives. In re Deepwater Horizon, 910 F.Supp. 891 (E.D. La. 2012); 732 F.3d 326 (5th Cir. 2013). The settlement agreement identified several categories of damage, only one of which capped damages payable to class members. The court approved a supervised program to administer the more than 91,000 claims filed by the end of 2012.

In the most recent ruling, the Fifth Circuit considered BP’s request to vacate the district court’s order granting class certification and approving the settlement. BP alleged that a conflicts of interest existed among the plaintiffs, some of whom allegedly suffered no damage at all. It also presented declarations from economists regarding the financial impact on BP of the sizeable settlement fund.

The court rejected all of these arguments, noting that BP had not cited any legal authority to vacate an order for class certification that it had previously supported, and that much of the evidence presented by BP had not been made available to the district court. It also rejected the argument that the court should vacate the order because of harm to BP’s interests by the unanticipated amount of the settlement payments.

The personal injury attorneys at Lebowitz & Mzhen represent the rights of people in the Washington, DC area who have suffered injuries due to the illegal, tortious, or negligent conduct of others. For a free and confidential consultation, contact us today online or at (800) 654-1949.

More Blog Posts:

DC Appellate Court Affirms that OSHA’s Hazardous Material Regulations Do Not Preempt Personal Injury Claims Under State Law, Washington DC Injury Lawyer Blog, January 28, 2014
Federal Government Sues Contractors in Washington DC Court Over Allegedly Defective Material Used in Body Armor, Washington DC Injury Lawyer Blog, January 14, 2014
BP Settles Lawsuit Related to 2010 Oil Platform Explosion, Washington DC Injury Lawyer Blog, March 15, 2012
Photo credit: By Petty Officer 1st Class Michael B. Watkins [Public domain], via Wikimedia Commons.

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