On Friday of last week, Alabama Attorney General Troy King announced that the state of Alabama has filed two lawsuits (on Thursday); one against BP and the other against Transocean, Haliburton, Anadarko and other companies. Interestingly enough, it appears that the suits were filed despite the wishes of Alabama Governor Bob Riley who says that the state should pursue out of court settlements first. The suits, filed by Alabama law firm Balch Bingham, accuses BP of "negligent or wanton failure to adhere to recognized industry standards of care.". King stated that the state was increasingly concerned that BP's history of broken promises and saying one thing and doing another would cause further anguish to the residents of Alabama. The state has concerns that BP will shirk its fiscal responsibility to Alabama residents. The amount of the damages being sought in the suit have not been specified. As an aside, here's an interesting document showing how much BP has paid out so far in settlement of claims made by Alabama residents from the Alabama Attorney General's oil spill website. As of Friday, BP has paid out just over $83 million in claims and has had 29534 claims for property damage and 547 claims for bodily injury in Alabama alone with no claims being refused to date. It's interesting to see that claims have been made for bodily injury ranging from eye irritation, headaches, nausea, sprains and strains and even hot flashes!
Another class action lawsuit was filed on July 27th by the firm of Beasley, Allen, Crow, Methvin, Portis and Miles P.C. seeking damages for 2 class representatives who claim personal injuries and property damage related to BP's oil spill remediation. In this case, both BP and Nalco are the targets; Nalco is the company that supplied million of gallons of the dispersant Corexit 9500 used to break up the oil spill. According to the suit, Corexit is considered four times as toxic as crude oil and it is claimed that the representatives have had respiratory and gastrointestinal problems related to the widespread use of the toxic chemicals found in Corexit. Here's a posting that I did on Corexit back in early May if you wish to get some information on the product being used to "clean" the Gulf. Just in case you wondered, Beasley Allen has a track record in large civil litigation settlements with over $20 billion in verdicts to date. Their environmental attorneys negotiated the largest environmental settlement in United States history against Solutia, Monsanto and Pharmacia for PCB contamination in Alabama. The settlement amount was for $700 million. As well, they recorded an $11.8 billion settlement against ExxonMobil Corp. for breach of contract and fraud in relation to royalties payable on natural gas production to the state of Alabama.
As it stands now, more than 300 suits have been filed in federal court against BP since the April 20th Deepwater Horizon explosion. Within the next two weeks, Beasley Allen alone is expected to file an additional 800 cases in addition to those previously filed.
When you put the whole story together, it's interesting to see how many vultures are circling and the body isn't even dead yet! One thing is reassuring though; at least a select group of Americans with law degrees will be weathering the economic downturn without too much of a personal slowdown. Perhaps we should just look at it as a transfer of wealth from one wealthy group to another.
To date, BP claims that they have paid out over $347 million after receiving 148,000 claims; it has yet to deny a claim however, some 40,000 claims are still outstanding. As well, BP has now established a trust account and made a $3 billion initial deposit into the proposed $20 billion escrow account announced in June. This deposit was made ahead of schedule; the next $2 billion depost will be made in the fourth quarter of 2010. BP has estimated that they have spent approximately $6.1 billion to remediate the cost of the spill to date.
Oh yes, and to top a great week off for BP, they will be paying a record $50.6 million fine/penalty for failing to fix safety problems at their Texas City oil refinery after a 2005 explosion killed 15 employees. This is the largest penalty assessed in the history of the United States Occupational Safety and Health Administration (OSHA). The OSHA is also going after another $30 million for an additional 439 new violations that were discovered during their 2009 investigation that resulted in the $50.6 million fine for failing to correct deficiencies. Reassuringly, BP has this to say about this particular transgression:
"As part of this agreement, BP will further accelerate its ongoing multi-year program of investment in activities that are designed to implement industry leading process safety practices and address potential hazards which are identified through comprehensive engineering reviews."
Just in case you're thinking that you want to get in on the action while BP is wobbling at the knees, here are a couple of law firm websites that may be of use:
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