re: BP story on fraud DW Horizon spill settlement from 60 minutes

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BP didn't realize they were dealing with Nigerian style corruption when they hired local lawyers. BP has every right to go back on the deal as it was illegally drawn up.

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You show how much you know right here. BP didn't have local lawyers representing them.

Kirkland & Ellis
Gibson, Dunn & Crutcher

The first represented BP the 2nd represented BP's Board. Neither are local and both agreed to the original settlement.

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The settlement very clearly sets out the requirements.

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So the agreement actually contemplated claimants who suffered business losses wholly unrelated to Macondo?

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It's a class settlement

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So the class was certified as anyone in the affected states that suffered a business loss of any kind including those unrelated to the spill?

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So the agreement actually contemplated claimants who suffered business losses wholly unrelated to Macondo?

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It doesn't require (in most cases) showing direct causation. That's not a accidental omission.

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So the agreement actually contemplated claimants who suffered business losses wholly unrelated to Macondo?

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Yes. From the article I posted:

"Soon after the deal was announced, one of the other corporate defendants raised concerns about the settlement's causation tests. In April 2012 Halliburton, represented by Donald Godwin of Dallas' Godwin Lewis, filed an objection to the settlement, worried that it might later be forced to contribute to these payments. Halliburton described the settlement as too generous and pointed out that the causation tests would let plaintiffs recover for losses that weren't caused by the spill. BP didn't contest this point, instead successfully arguing that Halliburton lacked standing to object.

To show its commitment to paying claims quickly, BP agreed to let the new claims process begin before Barbier gave his final approval. In early June 2012 Juneau began running the Deepwater Horizon Court Supervised Settlement Program.
Halliburton continued to raise red flags about the causation tests. This time, BP responded that it could be as generous as it wanted to be. On August 12, 2012, Godfrey wrote a letter to the magistrate judge overseeing the settlement in which he objected that Halliburton wanted to take discovery on "individual causation—the extent to which any individual's damages were caused by the spill." Godfrey stated: "Halliburton clearly wishes to ensure that the causation presumptions are not too generous to the class members. … There is no legal defect in a settlement that is too generous to the class."

It didn't take long for the causation issue that Halliburton had identified to resurface. Members of Juneau's staff wondered what they should do about claims for losses that satisfied the objective causation tests in the settlement, but that clearly weren't related to Deepwater. On September 25, 2012, Michael Juneau (the son of Patrick Juneau), who was working as special counsel to the claims center, emailed BP managing attorney Mark Holstein, asking how to handle the claim of a small accounting firm whose income fell temporarily because three partners went on medical leave. Could that business recover a fairly substantial amount, he asked?

Holstein answered yes, although in tortured language. The BP lawyer emphasized the importance of claims being processed under "objective, data-driven methodologies," calling this a "cornerstone" of the settlement. There was no provision, he acknowledged, for reducing an award if these damages weren't caused by the Deepwater spill.

"Nothing in the BEL Causation Framework (Ex. 4B) or Compensation Framework (Ex. 4C) provides for an offset where … extraneous nonfinancial data indicate that the [revenue] decline was attributable to a factor wholly unrelated to the oil spill," Holstein wrote. "Such 'false positives' are an inevitable concomitant of an objective quantitative, data-based test."

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So the class was certified as anyone in the affected states that suffered a business loss of any kind including those unrelated to the spill?

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It does not require showing that the loss was related to the spill, for example:

II. Causation Requirements for Zone B and Zone C

If you are not entitled to a presumption as set forth in (I) above and you are located in Zone B or Zone C then you must satisfy the requirements of one of the following sections A-E below:

A. V-Shaped Revenue Pattern:

Total business revenue shows the following pattern:

1. DOWNTURN: a decline of an aggregate of 8.5% or more in total revenues over a period of three consecutive months between May-December 2010 compared to the same months in the Benchmark Period selected by the claimant; AND

2. LATER UPTURN: an increase of an aggregate of 5% or more in total revenues over the same period of three consecutive months in 2011 compared to 2010.

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A cell phone company made a claim and that was not in business for two years prior to the spill Marine. I would suggest that everyone take a peak at the segment of 60 minutes as the claims for damages are cited along with the amounts for each of them.

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Was it a new business? There is a framework for that. If it was a failed business, the requirements for those claims are very stringent and do require a showing of causation. Without knowing more details on the claim it's impossible to say.

It would be interesting to know how many people in this thread are accountants and attorneys. And how many in this thread are just interested people who do no work on claims.

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It would be interesting to know how many people in this thread are accountants and attorneys. And how many in this thread are just interested people who do no work on claims.

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It's pretty commonplace on this board for regular posters to know at least a little about a lot of things...most of us are almost O-C about it.