U.S. court rejects BP appeal over Gulf spill losses

Tue Mar 4, 2014 8:27am EST
 
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By Jonathan Stempel

(Reuters) - A divided U.S. appeals court on Monday rejected BP Plc's bid to block businesses from recovering money over the 2010 Gulf of Mexico oil spill, even if they could not trace their economic losses to the disaster.

By a 2-1 vote, the 5th U.S. Circuit Court of Appeals in New Orleans upheld a December 24 ruling by U.S. District Judge Carl Barbier in New Orleans, authorizing the payments on so-called business economic loss claims. It also said an injunction preventing payments should be lifted.

BP said on Tuesday it was considering its options in the wake of the decision which it said would improperly allow for the payment of losses with no connection to the spill.

The appeals court decision is a setback for BP's effort to limit payments over the April 20, 2010, explosion of the Deepwater Horizon drilling rig and rupture of BP's Macondo oil well.

The disaster killed 11 people and triggered the largest U.S. offshore oil spill.

BP has settled criminal proceedings but spill litigation in the form of a civil trial continues to hang over the company. It is two phases into a three-stage civil case, and could face fines of over $17 billion.

It has so far provisioned $42.7 billion to pay for cleanup, compensation, legal and other costs related to the spill.

The business economic loss claims linked to the current U.S. appeal court ruling are a comparatively lesser financial issue - disputed claims totaled around $1 billion at the time of BP's last financial update in February.   Continued...

 
Fire boat response crews battle the blazing remnants of the offshore oil rig Deepwater Horizon, off Louisiana, in this April 21, 2010 file handout image. REUTERS/U.S. Coast Guard/Files/Handout