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BP Can't Require Proof of Losses in Spill Deal

Bloomberg

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BP Plc lost a bid to require businesses to provide proof their economic losses were caused by the 2010 Gulf of Mexico oil spill under a $9.2 billion settlement over the disaster.

U.S. District Judge Carl Barbier in New Orleans, overseeing the settlement of lawsuits spawned by the blowout of BP's Macondo well, found the London-based oil company would have to live with its agreement to pay billions of dollars in business losses tied to the disaster. An appeals court ordered Barbier in October to reexamine the accord's terms to ensure claimants wouldn't receive improper payouts.

In the settlement, BP agreed businesses in certain geographical regions were presumed to have been harmed by the oil spill if their losses followed a specific pattern, Barbier concluded in the Dec. 24 ruling. As part of the accord, BP agreed these claimants wouldn't have to prove a link to the spill to recover, the judge said. The company now contends claimants can only recover if they have damages directly linked to the spill.

"BP's current position is not only clearly inconsistent with its previous position, it directly contradicts what it has told this court regarding causation" of damages, Barbier said in his ruling.

BP officials said they plan to appeal Barbier's ruling that claimants don't have to show their damages were directly tied to the spill.

"Awarding money to claimants with losses that were not caused by the spill is contrary to the language of the settlement and violates established" legal principles, Geoff Morrell, a BP spokesman, said in an emailed statement.

"Business owners across the Gulf should be pleased that Judge Barbier once again rejected BP's efforts to rewrite history and the settlement," Steve Herman and Jim Roy, leaders of a group of plaintiffs' lawyers overseeing the BP settlement, said in an emailed statement.

— Bloomberg News

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