What Joe Nocera’s defense of BP leaves out

New York Times columnist bemoans failure of oil giant
to get its corporate life back

Pity poor BP.  In an act of noble corporate citizenship the oil company rushed to make amends for that little problem it encountered down in the Gulf of Mexico a few years ago – only to find itself picked on by those big bullies in the plaintiffs’ bar.

Hey, don’t laugh.  That’s the serious take of a serious columnist for a serious newspaper.  Joe Nocera of The New York Times is deeply upset that more than  three years after BP’s Deepwater Horizon drilling rig exploded, killing 11 (deaths for which the company pled guilty to multiple counts, including felony manslaughter), injuring 17 and setting off the worst environmental disaster in American history, BP hasn’t gotten its corporate life back, so to speak.

He writes:

BP is the best example I’ve ever seen of a company that actually tried to find a better way. Immediately after the spill, it set up a claims process to get money into victims’ hands quickly, without having to file a lawsuit. Though that process had its critics, it worked. Of the $11 billion BP has paid out in claims, $6.3 billion was paid through that process.

But BP did not set up this process out of the goodness of its heart.  It did so under pressure from the Obama Administration, and, as we pointed out in our comprehensive 2010 report, because such a process is required by federal law.  BP made sure the process was set up in a way that limited its exposure and obtained final releases of liability from victims for as little as possible.

         Contrary to Nocera’s insinuation, the process did not provide a magical solution which adequately replaced the right to seek redress in court.  Victims whose lives have been devastated by the spill had to make impossible decisions – accept a settlement without knowing how much the spill ultimately may cost them or take their chances in the court system where the deck might also be stacked against them.

Nocera never explains the criteria he uses to determine that the claims process “worked.”  In our report, we found serious problems, including:

● The way the administrator of claims was paid raised questions about whether he put BP’s interests ahead of victims’.

● Victims received insufficient information when their claims were denied or underpaid.

● To get any payment at all, victims had to sign away their right to seek compensation for future, unforeseen losses.

Nocera then takes a cheap shot at the judge, condemning him for once having been “a Louisiana plaintiffs’ lawyer …”  But here’s the thing about judges: they’re almost always lawyers.  And lawyers often specialize in one side or the other.  Does Nocera really believe that only a corporate lawyer can be objective?

          If so, he should be happy with the prospect of litigation in the Gulf Coast states.  The Fifth Circuit Court of Appeals, which would hear appeals from awards to victims, is chock full of judges with ties to the oil industry – judges like Jerry Smith, aptly characterized by AFJ President Nan Aron as

a former chairman of the Texas State GOP Executive Committee who once characterized the League of Women Voters as the ‘plague of women voters,’ and referred to the International Women's Year Conference as a ‘gaggle of outcasts, misfits, and rejects,’ with ‘perverted views.’ He was also an oil-industry lawyer, specializing in federal energy litigation – a category of cases he now frequently hears as a judge in the oil-soaked Fifth Circuit.

Perhaps most alarming, Nocera snidely dismisses the notion of helping people who were harmed “indirectly” – seeing that as nothing but a loophole for those bad, bad plaintiffs’ lawyers to take advantage of.

But “indirect” harm can mean a tourist business bankrupted because people changed their vacation plans.  Or it can mean damage to a seafood business caused because people just didn’t want to eat seafood from the Gulf.  The federal law governing damages caused by oil spills allows victims to recover for exactly this type of indirect harm.

And, as we noted in our report, “the disaster is hurting more than people’s pocketbooks.  Surveys of residents show that depression is up 25 percent, and domestic violence has increased.”

But Nocera chooses to smear anyone not directly impacted by polluted beachfront or seafood as “basically bystanders [who] now have their hands out…”

And what is behind this outpouring of bile?  Nothing but Nocera’s own personal experience covering a very different kind of case nearly two decades ago.  He covered mass litigation against a manufacturer of silicone breast implants, and felt himself to have been an eyewitness to the abuses of plaintiffs’ lawyers.  (Even here, Nocera’s account is incomplete.  He cites an Institute of Medicine review claiming that there was insufficient evidence to support allegations about systemic illnesses allegedly caused by the implants.  But, as AFJ first noted in a 2006 report, the same review found a high rate of localized problems, including rupture of the implants, pain, disfigurement and serious infections.)

“We all have experiences that shape our view of the world, and this was one of mine,” Nocera wrote.

Yes, we all have such experiences, and we all are affected by them.  But we also must be on guard against the tyranny of personal experience – how the raw emotional impact of something we’ve seen with our own eyes can blind us to context and even to facts.

We can’t help but wonder: What if Joe Nocera’s father ran a seafood business that had been wiped out by the "indirect" effects of an oil spill.  What would he be writing today?

And if you’d like to meet some real people who just might change your mind, Joe, check out our documentary about the aftermath of the BP spill, Crude Justice:

BP’s fine less than oil giant’s profits in a single quarter

Company admits to felonies; implications for civil suits unclear

It certainly sounds like a lot.  After spewing hundreds of millions of gallons of oil into the Gulf of Mexico, fouling beaches, killing wildlife and ruining livelihoods up and down the Gulf Coast, oil giant BP will pay fines and penalties of more than $5 billion over five years.  News accounts are trumpeting the largest criminal penalty in U.S. history.

But that needs to be understood in the context of what it means to be an oil giant.  The fine equals about $262 million per quarter for 20 quarters.  But in just the most recent quarter, BP amassedprofits of $5.43 billion.  That’s more than all the fines and penalties agreed to today.  Looked at another way, had BP been required to pay one-quarter’s worth of the fine during the most recent quarter, it would have cut the company’s profits by less than five percent.

This for a company that also is pleading guilty to 11 felonies relating to the deaths of 11 people when its Deepwater Horizon offshore oil rig exploded in 2010.  Two BP employees have been charged with involuntary manslaughter.

This may be the best the government could do given that, had the case gone to trial, it would have been heard in what AFJ President Nan Aron has aptly dubbed the “oil soaked Fifth Circuit” – a reference to the ties between some judges in that circuit and the oil industry.

BP may yet have to pay more, including a fine of up to $21 billion for violating the Clean Water Act – something worth remembering whenever conservative lawmakers rail against “excessive government regulation.”  But that, too, is subject to negotiation.

AFJ is studying the settlement to determine the impact, if any, on the small businesses and private citizens who sued BP, some of whom were profiled in AFJ’s documentary Crude Justice.  Many, but not all, of those cases were settled earlier this year, settlements BP estimates will cost the company about $7.8 billion.

Anticipating that the impact of the disaster would continue to be felt long after the initial damage was done, Alliance for Justice worked hard to advocate for legal solutions that would let Gulf Coast residents retain their right to hold BP accountable for the damage done to their health and businesses, and to be compensated for loss of income due to the long-term environmental impact of the spill. 

Through Crude Justice and other efforts, AFJ has played a substantial role in bringing public attention to the critical issues surrounding the Deepwater Horizon accident, its effects, and the search for justice.  AFJ was instrumental in helping to secure $2 million to pay for legal aid attorneys to assist victims of the spill.  A year after the spill, we published an in-depth report on how the legal process was and wasn’t working to help victims achieve justice.

For more about the Deepwater Horizon explosion, it’s impact on the people of the gulf, and their efforts to find justice, check out these resources on our website.

Two Years After Spill, Troubles Remain for Gulf Coast Residents

Two years ago today, an explosion on the Deepwater Horizon oil rig killed eleven people and resulted the release of massive amounts of crude oil into the Gulf of Mexico. In the months that followed, 1.84 million gallons of chemical dispersants were also pumped into Gulf waters as part of the cleanup effort.

At the time, many people raised significant concerns about the short and long-term environmental impact of the oil and chemicals flooding the ecosystem, and of the damage that could occur both to the livelihoods of Gulf residents and to the health and well-being of clean-up workers. Others – including Alliance for Justice – raised concerns with BP’s offer of one-time settlement payouts that were based on their guess of how quickly fisheries would recover from the disaster.

Now, two years later, all those concerns appear to have been well-founded.

When fishermen resumed their trade soon after the disaster in 2010, many of the fish they were catching had open lesions and atypical coloring. After two years, multiple deformities are still being found in fish and shrimp caught in the Gulf, raising concerns not only about food safety, but about the ability of Gulf Coast residents to resume their livelihoods even years after the spill.

Discovering eyeless shrimp, lesioned fish and other mutated and underdeveloped seafood, fisherman in the Gulf are pointing fingers at the BP spill. Biologist Dr. Darryl Felder told the news agency that Gulf seafood populations are dropping at alarming rates and that species richness is "diminished.

"The Gulf Restoration Network's Scott Eust explained the bizarre shrimp deformities. "We have some evidence of deformed shrimp, which is another developmental impact. So, that shrimp's grandmother was exposed to oil while the mother was developing, but it's the grandchild of the shrimp that was exposed grows up with no eyes."

Anticipating that the impact of the disaster would continue to be felt long after the initial damage was done, AFJ worked hard to advocate for legal solutions that would let Gulf Coast residents retain their right to hold BP accountable for the damage done to their health and businesses, and to be compensated for loss of income due to the long-term environmental impact of the spill.

Our award-winning short film Crude Justice laid out the legal challenges facing residents as they decided whether or not to accept the one-time settlements offered by BP.



This week, after an audit from the Department of Justice, BP agreed to an additional $64 million in settlements with Gulf Coast residents whose earlier claims were wrongfully denied or miscalculated. That’s certainly welcome news to the thousands of families affected.

However, as we saw this week, it’s obvious that the spill will continue to have devastating effects on the lives and livelihoods of Gulf Coast residents. It’s a clear reminder how important it is to stand up for individuals’ rights when they’re trying to hold corporations accountable for their actions. After two years, let’s not forget the struggles Gulf Coast residents are still facing.

Gulf Oil Spill Legal Processes Wind Down

On March 3rd, a major development occurred in the ongoing legal fallout from the Deepwater Horizon oil rig explosion and oil spill, when a mass settlement was reached between BP and the Plaintiffs’ Steering Committee. 

The settlement occurred nearly two years after an explosion on the rig leased to and operated by BP killed eleven workers, injured seventeen more, and unleashed a torrent of oil into the Gulf of Mexico.  In the spring and summer of 2010, the world watched as over 200 million gallons of oil flowed for almost three months, pouring into the open water, damaging economic livelihoods and the coastal environment in profound ways.  Additionally, BP released 1.84 million gallons of chemical dispersants, with the eventual impact on health and jobs impossible to know with certainty.

The Deepwater Horizon spill caused injuries all along the Gulf coast, and prompted countless lawsuits by all sorts of entities, including individuals and businesses.  As one might expect, a great many of these lawsuits involved claims by private individuals for adverse health effects caused by the spill and its aftermath, damage to property, and damage to economic livelihoods by everyone from oyster fishers to tourism industry workers.  These private suits were compiled together in Multi-District Litigation 2179 in New Orleans, with a Plaintiffs’ Steering Committee appointed by the court to handle the cases.  This past week, BP, with the Plaintiffs’ Steering Committee, announced a settlement of a “substantial majority” of such claims, subject to final written agreement.

BP Tries to Limit “Future Loss” Payouts to Gulf Residents

BP has decided that it does not feel that those harmed by the Gulf Oil Spill deserve “future losses.” In its view, the environmental recovery efforts have been so successful that claimants are not likely to suffer any future harm from this catastrophe.

In papers recently filed with the Gulf Coast Claims Facility, BP asserted that "There is no basis to assume that claimants, with very limited exceptions, will incur a future loss related to the oil spill."

Gulf Coast residents whose livelihoods depend upon the vitality of the environment might disagree.

While it may be true that fish populations in the Gulf remain large and that seafood testing has yet to reveal any significant contamination, Chris Nelson, vice president of Bon Secour Fisheries Inc., said that the negative effects of the spill may not be detectable until marine life has passed through several generations. Indeed, after the Exxon Valdez spill, it took several years for scientists to realize that the herring population had diminished.
As reprehensible as this legal maneuver might be, it should not be surprising those who have been following BP’s attitude towards a disaster that it played a large part in causing. In its Crude Justice report, the Alliance for Justice indicated that as early as February 2011, BP began its attempt to avoid paying future damages when it argued that GCCF’s proposed formula for calculating them was too high. Now, it appears that BP has gone a step further, asserting that claimants are not entitled to any future damages at all.
Of course, with this continued effort to see that claimants are paid as little as possible, BP is simply looking out for the interests of its shareholders. Because it cannot be expected to police itself, legislators need to be encouraged to ensure that all corporations like BP are held accountable when their recklessness wreaks havoc on society and the environment.
Click here to learn more about AFJ’s efforts to ensure that victims of the Gulf Oil spill are treated fairly.

Long Term Health Effects of Oil Spill Remain Murky

While it is clear that the Gulf oil spill took an immeasurable toll on the ecosystem and natural resources of the Gulf region, the spill’s effect on the health of residents and cleanup workers remains largely unknown. What is known is that over 200 million gallons of oil, as well as approximately 1.84 million gallons of dispersants used in an attempt to break up the oil were dumped into the Gulf of Mexico. There have been widespread reports of symptoms like headaches, eye irritation, nausea, and coughs by residents and cleanup workers, which they attribute to exposure to oil and/or the chemical dispersants.

Cleanup workers like Andre Gaines say they’ve developed dry coughs, nausea, and even skin rashes, but have seen no public health response to their claims. In a New York Times story yesterday, Gaines described leaving hospital visits with no answers about his symptoms. “Who do we call? Our government is not talking about this,” Gaines says in the article. “They took advantage of us.”

The Times-Picayune reports that one three year-old who visited the Gulf on vacation after the spill had blood levels with three times the normal level of ethylbenzene (a toxin). This result is mirrored in blood tests conducted on a broad swath of Gulf residents.

One survey conducted by the Louisiana Bucket Brigade found that “Almost three quarters of respondents who believed they were exposed to crude oil or dispersant also reported experiencing symptoms.”

As the New York Times article reports, however, assessing the long-term health effects, and holding the responsible parties accountable are complicated endeavors. “The problem, advocates say, is that there is little access to health care or specialists familiar with treating oil and chemical exposures. Further, they say, no reliable registry of these health problems exists, though a $10 million federal study of the health effects of an oil spill was recently launched.”

The question remains as to whether BP will foot the bill for spill-related health screening and treatment of those who may have been exposed to oil or dispersants. The oil giant has contributed $10 million for a National Institute of Environmental Health Sciences study that will analyze the long-term health effects of the spill on cleanup workers. But advocates have raised major concerns about the study, including the cost of the delay in financing the study, and the fact that the study only includes cleanup workers. Moreover, there is no treatment associated with the study for those who evidence health-related problems from oil or dispersant exposure.

More information about the health effects of the BP oil spill is available here.

One Year After Spill, BP Tries to Shift Blame from Itself

Oil Giant Claims Transocean Caused the Deepwater Horizon Disaster

One year after the worst oil spill in history, the responsible party commemorated the occasion by pointing the finger at the other companies involved. Yesterday, BP sued Transocean for over $40 billion, including punitive damages, trying to shift blame from itself onto Transocean and the other companies that operated the well.

BP also brought claims against Cameron International, the company that manufactured the faulty blowout preventer, Halliburton, the company that made the allegedly faulty cement casings, as well as other companies.

BP’s complaint against Transocean claimed that “The simple fact is that on April 20, 2010, every single safety system and device and well control procedure on the Deepwater Horizon failed, resulting in the casualty.” BP claimed that Transocean did not adequately maintain the rig, failed to fix engine problems, and failed to properly train the crew to deal with a fire on the rig. Yesterday was the deadline for bringing claims against Transocean under an order issued by the judge overseeing all lawsuits related to the oil spill.

Transocean filed a counter-lawsuit against BP, arguing that it failed to fulfill its contractual promise to indemnify (pay back) any damages Transocean incurred for personal injury and death lawsuits. Meanwhile, Halliburton has also filed lawsuits against BP, Transocean, and other companies, claiming that the explosion was caused by those companies, “and not by any conduct on the part of Halliburton Energy Services.”

In February, U.S. District Court Judge Carl Barbier will oversee the first oil spill trial and determine whether Transocean can limit its liability. At that time, the court will likely also determine how much blame each of the companies involved bears for the disaster.

As the companies responsible for the oil spill pointed fingers and one another and positioned themselves to avoid as much responsibility as possible, the hundreds of thousands of people whose lives have been turned upside down by the spill continue to wait for justice and wonder if they will ever be made whole.

Click here for more information about BP’s claims against the other companies.

Tell Congress: Don't let the Court protect corporate polluters

Last year, Americans watched in horror as the Deepwater Horizon oil rig exploded in the Gulf of Mexico and oil gushed from the ruptured wellhead for three months. The explosion took the lives of 11 rig workers, and the millions of barrels of crude oil that spilled into the waters of the Gulf disrupted the livelihoods of residents who depend on the Gulf ecosystem for their income and survival.

The Exxon Valdez disaster in Prince William Sound, Alaska, is a haunting predecessor to the calamity in the Gulf. After almost 20 years of litigation, the U.S. Supreme Court cut down the punitive damages awarded by an Alaska jury by 90 percent and created a new rule limiting citizens' ability to recover punitive damages in maritime cases.

Senator Sheldon Whitehouse (D-RI) has introduced the Maritime Liability Fairness Act (S. 592), a bill that restore the law to where it was three years ago by removing the unfair cap set by the Supreme Court on liability awards for victims of catastrophes like the BP oil spill and Exxon Valdez. Tell your senators to support this bill!

Gulf residents must make difficult choices when seeking compensation and face a long and uncertain road to justice and recovery. Even one year after the Deepwater Horizon disaster, the fight for justice is often slow, frustrating, and tilted in favor of the corporate interests over individual rights. The Supreme Court has tilted that balance even more in favor of pro-business interests, but Congress can set things right by restoring the ability of victims to be fairly compensated when their lives and livelihoods are wrecked by corporate irresponsibility.

After the Supreme Court took Exxon's side, the oil giant posted a record $11 billion quarterly profit. Exxon didn't need the Court's help, but Gulf Coast residents struggling to get by need ours – as will future victims of offshore oil spills.

Write to your senators today and urge them to support the Maritime Liability Fairness Act. Tell them how important it is that citizens be allowed to hold corporations accountable for disasters like the Deepwater Horizon spill!

Gulf Coast victims continue to face obstacles

One year after the massive oil spill in the Gulf of Mexico, many are assessing the process of recovery for those who suffered economic losses or property damage. Alliance for Justice released a report today which provides detailed analysis of the continuing struggle for fair and timely compensation one year after the Gulf oil spill, and investigates whether the legal system is working fairly to provide those affected with adequate compensation.

The New York Times reported yesterday that many affected by the Gulf spill have attempted to file a claim with the Gulf Coast Claims Facility (GCCF), only to find that claims have already been filed on their behalf by lawyers they never hired. Vietnamese-Americans in the Gulf coast report being misled into signing legal retainers and being told they were signing up for financial or medical assistance. In many cases they dealt with a contractor hired by local lawyers recruiting clients to the large firms taking part in the multi-district litigation against BP. As the New York Times reports:

“The problem in many cases seems to have started at the ground level. Here in Bayou La Batre, Vietnamese people tell of contractors who allowed relatives to sign them up in absentia, or who encouraged potential clients to sign official-looking forms — in English — without explaining that the forms were legal retainers. The stories vary but the same few names come up.

Having heard similar reports last September, Lan Diep, an Equal Justice Works and AmeriCorps fellow working on the Gulf Coast, visited the office of one such contractor, in a ranch house just outside of town.

Not letting on that he spoke English, Mr. Diep was told by a man at the house that he could get money simply by filling out a form and handing over some financial documents. He was given a retainer for Brent Coon and Associates, a Texas law firm, he said, but was not told that he was signing up for a lawyer nor was he allowed to keep a copy for himself.”

Alliance for Justice’s new report argues that more widespread access to the free legal services available through the GCCF would help protect claimants from predatory lawyering. Information about legal aid must be made more prominent and available. All GCCF claims information, moreover, should be written in non-technical, accessible language, and made available to non-English speakers.

Read One Year After the Gulf Oil Spill: Is Justice Being Served? and learn more about Alliance for Justice’s full list of recommendations and the ongoing fight for justice in the Gulf.

The Myth of "Spillionaires"

Last week, Kim Barker wrote an article that ran in the Washington Post claiming that the oil spill has delivered a "gusher of money," creating a new class of "Spillionaires." The article cites a handful of examples of companies that received windfalls from BP thanks to corrupt local officials who secured lucrative contracts with the companies for political supporters. Barker’s article, Spillionaires are the New Rich after BP Oil Spill Payouts, paints a picture suggesting that the spill was lucrative for many, if not most, Gulf coasters.

But is it true that the most people who are choosing to settle claims with BP are getting the compensation they deserve? A new report by Alliance for Justice that will be released in the coming days suggests it is not, and makes recommendations for ways to ensure that victims are made whole.

While there may certainly be anomalous instances of individual claimants making out like bandits, Barker’s article is misleading in that it does not tell the story of the vast majority of claimants who continue to suffer economically because of BP. Spillionaires acknowledges (near the end of the article) that "those at the bottom earned much less" and that not all have received fair compensation – reinforcing the fact that the Spill has in many cases hit the most vulnerable the hardest.

A new article by the Mobile Press Register paints a picture very different from the one in Spillionaires – telling the story of a handful of the many victims whose life investments have been wiped out because of the spill, and for whom the claims process set up by BP has failed to provide meaningful recompense. For instance, sixth-generation fisherman Paul Johnson received just $10,000 from GCCF, despite the fact that his oyster catch has dropped from 400 to 60 gallons a week. Johnson has chosen not to accept a final payment from GCCF, despite his dire financial situation, and will continue trying to get by on short-term payments from GCCF that do not require him to give up his right to sue BP.

To learn more about the effect the oil spill has had on residents of the Gulf, check out Alliance for Justice's award-winning short film, Crude Justice .

Greater Transparency and Efficiency for Deepwater Horizon Claims in Florida

Following the Deepwater Horizon disaster, a $20 billion fund was established to compensate Gulf Coast businesses and residents for damage and loss of business due to the spill. The process for evaluating and paying claims has been criticized for its lack of transparency.

Now, Gulf Coast Claims Facility Administrator Kenneth Feinberg, after consulting with Florida’s governor and attorney general, has agreed to make changes in the way claims are processed in Florida. Many of the new procedures in Florida will improve transparency and should lead to a more fair and efficient process.

Among the changes Feinberg will institute at GCCF are:

• Committing to processing at least 25 percent of pending claims by March 31, 2011.
• Expanding staffing in Florida to provide more localized support and more efficient reporting throughout the state and in Washington.
• Assist claimants in finding independent accounting firms to review claims, and reimburse claimants for the expense of hiring an accountant.

Feinberg will return to Tallahassee in April to evaluate the impact of these changes and discuss next steps.

BP Responds to GCCF Claims Methodology

Today’s New York Times reports that BP has weighed in on the proposed claim and compensation methodology set forth by the Gulf Coast Claims Facility. The proposal outlines the steps and methods GCCF will use to determine how much to compensate the people who were harmed by BP’s Deepwater Horizon oil spill.

The oil giant is arguing that if anything, Mr. Feinberg’s proposed settlements are too generous. The planned payments far exceed the extent of likely future damages because they overstate the potential for future losses, the company insists in a strongly worded, 25-page document that was posted on the fund’s Web site Thursday morning.

Basing its estimates on much of the same data Mr. Feinberg used, the company concluded that there was “no credible support for adopting an artificially high future loss factor based purely on the inherent degree of uncertainty in predicting the future and on the mere possibility that future harm might occur.”

BP has pledged a fund of $20 billion to compensate the victims of their oil spill. Feinberg has famously estimated that the GCCF will pay out only $10 billion in claims. Now it seems that BP is putting pressure on Feinberg and the GCCF to pay out as little as possible, disregarding arguments for a more cautious, fair, and transparent approach.

AFJ also analyzed the GCCF’s proposed methodology, and found that, contrary to BP’s claims, it does not contain sufficient provisions to protect the rights and interests of the spill victims.

AFJ applauds GCCF for taking the step of releasing its methodology to promote greater transparency in the claims process. We take this opportunity to suggest a number of improvements that should be made to better protect claimants’ rights. Namely, because the projection of when the Gulf will fully recover is inherently speculative, the methodology should include a mechanism to address harms greater than those forecasted in the projection relied upon by GCCF. Moreover, the methodology should more clearly inform claimants of the documentation requirements, causation standard, and eligibility criteria GCCF will use in administering claims. Finally, going forward there needs to be more transparency in the way the methodology is applied to individual claims.

You can read our entire analysis and our recommendations online. You can also view other recommendations received by the GCCF on their website.

AFJ’s award-winning short film, Crude Justice, explores many of the legal issues Gulf Coast victims face as they fight for justice in a system that often seems dominated by corporate interests. You can now watch Crude Justice on YouTube.

Gulf Coast Claims Methodology Needs Changes

As part of its ongoing effort to promote justice for the individuals struggling to recover from the Deepwater Horizon oil spill, Alliance for Justice has sent recommendations to the Gulf Coast Claims Facility (GCCF) on the proposed methodology for processing claims and calculating damages.

Many Gulf Coast claimants face tough legal and procedural difficulties as they fight for fair compensation for their losses, and AFJ’s analysis has found that GCCF’s proposed methodology does not adequately protect residents’ rights. We found numerous ways in which the methodology needs to be improved if it is to offer a fair and transparent process for Gulf Coast residents.

Some of the problems AFJ recommends be addressed in the methodology are:

• The methodology relies upon an unreliable and inherently speculative projection of when the Gulf will recover.
• The methodology should better inform claimants of the specific documentation and eligibility standards used by GCCF.
• GCCF’s proposed methodology does not explain how GCCF will handle some of the claims BP is required to pay under the Oil Pollution Act of 1990, such as subsistence use claims for residents who rely on seafood for subsistence.
• The methodology’s underlying assumptions and the GCCF’s processes need to be more open, transparent, and free from corporate influence.
• GCCF’s proposed methodology calculates economic loss based on 2008 and 2009 figures, despite the fact that those years represent a low point in the US economy.

A PDF of AFJ’s analysis and full set of recommendations can be found here.

Judge Holds that Feinberg and GCCF Are Not Fully Independent of BP

Yesterday, Judge Carl Barbier, who is overseeing the Gulf oil spill litigation against BP, held that Gulf Coast Claims Facility (GCCF) and its administrator, Ken Feinberg, are not fully independent of BP. As such, the Court held that GCCF must abide by certain limitations when communicating with people who might have claims against BP and other potentially liable parties.

BP hired Feinberg to discharge its statutory duty to process claims for damages under the Oil Pollution Act (OPA). Judge Barbier wrote that in this sort of third-party arrangement, transparency is essential. The administration of the $20 billion trust fund has been plagued by criticisms that it is not sufficiently consistent and transparent. The Court noted that Feinberg and GCCF’s hybrid role has led to “confusion and misunderstanding by claimants, especially those who are unrepresented by their own counsel,” and that GCCF’s claimed independence and neutrality constitutes a “direct threat” to the legal challenge currently underway against BP.

Judge Barbier set forth a number of specific restrictions GCCF must abide by in communications with claimants, such as refraining from claiming to be “neutral” or “independent,” prominently disclosing the fact that individuals have a right to consult with an attorney, and telling claimants that they can join the litigation against BP if they decline to accept a settlement through GCCF.

In the order, Judge Barbier also indicated that he will soon issue a ruling on the broader question of whether BP is fully complying with OPA. Such a ruling could address whether several GCCF policies run afoul of the law, such as the requirement that individuals sign a release of liability in order to receive a final payment, and the methodology used to evaluate claims. Under the current GCCF protocol, to receive a final payment, claimants must give up their right to sue more than 100 named entities in addition to BP and must even waive claims not subject to OPA – provisions that have been criticized as overly broad. Judge Barbier wrote that “whether or not seeking such broad releases is appropriate, the GCCF is clearly acting to benefit BP in doing so.”

The ruling came after lawyers for individuals pursuing claims against BP in court, as well as Attorneys General from Mississippi, Louisiana, and Florida filed motions arguing that serious deficiencies in the handling of GCCF necessitated judicial oversight. The process has been criticized as not being sufficiently transparent, with inadequate explanation provided as to whether and at what amount claims are paid. Many claimants have also complained of apparent inconsistencies in the way claims are valued. Some have argued that GCCF is interpreting OPA too narrowly and is not adequately paying claims that would be recognized in court, such as subsistence claims for those who live off of damaged resources, and claims for punitive damages. Most recently, GCCF’s projection that the region will largely recover by 2011 has raised ire amongst the Spill’s victims.

Alliance for Justice’s short film, Crude Justice, explores many of the issues currently being raised by the legal process unfolding in the Gulf. The film and additional resources, including Judge Barbier’s ruling, can be found at www.crudejustice.org.

Crude Justice from Alliance for Justice on Vimeo.

National Commission on the BP Oil Spill Pulls No Punches in its Final Report

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling has released its long-awaited report on last year’s calamity in the Gulf of Mexico and reaches powerful conclusions about the causes of the disaster, including that "[t]he explosive loss of the Macondo well could have been prevented."

The commissioners explicitly tackle the root causes of the disaster, which they trace to "a series of identifiable mistakes made by BP, Halliburton, and Transocean that reveal such systematic failures in risk management that they place in doubt the safety culture of the entire industry."

The human and economic consequences for the victims of the spill in the Gulf region are discussed in the report, as well, and are the subject of Alliance for Justice’s recent First Monday film, Crude Justice, which details the difficult legal environment facing those seeking compensation for the damage done to their lives and livelihoods, either in the courts or through BP’s Oil Spill Liability Trust Fund.

Of particular interest is the finding by the commission that,

...oil spills cause a range of harms, both economic and environmental, to individuals and ecosystems. The Oil Pollution Act makes the party responsible for a spill liable for compensating those who suffered as a result of the spill—through property damage, lost profits, and other economic injuries—and for restoring injured natural resources. The Act also provides an opportunity to make claims for compensation from a dedicated Oil Spill Liability Trust Fund. The Oil Pollution Act, however, imposes limits on both the amount for which the responsible party is liable, and the amount of compensation available through the trust fund. In the case of the Deepwater Horizon spill, BP (a responsible party) has placed $20 billion in escrow to compensate private individuals and businesses through the independent Gulf Coast Claims Facility.

But if a less well capitalized company had caused the spill, neither a multi-billion dollar compensation fund nor the funds necessary to restore injured resources, would likely have been available.

It is critical that compensation to victims be paid in full, and that the process for receiving compensation is swift and efficient. The Commission offers recommendations that would increase assurances that responsible parties are able to compensate victims (and at the same time strengthens incentives to prevent accidents in the first place), and that the Oil Spill Liability Trust Fund provide any compensation not provided by responsible parties. It also recommends a close review of the Gulf Coast Claims Facility process to determine its effectiveness in adjudicating compensation claims and its value as a model for future Spills of National Significance.

The commission’s specific recommendations related to compensation for victims include a general need to "increase existing limitations on responsible party liability," and a call for Congress to "significantly increase the liability cap and financial responsibility requirements for offshore facilities."

Overall, the commission includes 31 recommendations in its 382-page report, covering all aspects of the disaster and its aftermath, including:

• Improving the Safety of Offshore Operations


• Safeguarding the Environment


• Strengthening Oil Spill Response, Planning, and Capacity


• Overcoming the Impacts of the Deepwater Horizon Spill and Restoring the Gulf


• Promoting Congressional Engagement to Ensure Responsible Offshore Drilling

These comprehensive and uncompromising findings deserve the immediate attention of Congress, the regulatory agencies, and the American people so that victims of this and any future calamity can receive full compensation, and to dramatically reduce the risk that such an event will ever recur.

Activists organize screenings of Crude Justice throughout the country

Last Tuesday was the deadline for Gulf Coast residents impacted by the explosion of the Deepwater Horizon oil rig to file claims for emergency payments from the BP compensation fund administered by Kenneth Feinberg. More than 400,000 claims were filed before the deadline, and approximately 150,000 individuals and businesses have received an estimated $2.2 billion. The next phase in this process is the negotiation of lump-sum final settlements for those affected by the spill, a process which will play out over the course of three years.

This fall, AFJ released Crude Justice, a short documentary film narrated by actor and environmentalist Ed Begley Jr., that highlights the impact of the oil spill on individuals, families and small business owners, and explores the legal landscape they are facing while seeking justice and fair compensation from BP and other liable parties. Along with over 5,000 online viewers, scores of activists have organized screenings of Crude Justice throughout the country. Here are a few highlights:

On October 6, the Eric R. Neisser Public Interest Program at Rutgers School of Law–Newark sponsored, “Crude Oil: Legal Implications of the Deepwater Horizon Oil Spill,” an event that included a screening of Crude Justice and a panel discussion exploring the environmental and community impact of the BP disaster in the Gulf. The panel was moderated by Steve Gold, Director of the Environmental Law Clinic at Rutgers-Newark and a former senior attorney in the Environmental Enforcement Section of the U.S. Department of Justice, and included Sarah Chasis Senior Attorney, Natural Resources Defense Council, and Rachel Jacobson, Principal Deputy Solicitor, U.S. Department of the Interior.

On October 25, the Environmental Law Society at the University of Mississippi School of Law organized a screening of Crude Justice and a discussion of the legal options open to Gulf residents. The discussion was led by professor David W. Case, who teaches environmental and toxic torts and environmental law, and professor Stephanie Showalter, who serves as Director of the law school’s National Sea Grant Law Center. The event drew over 50 students from the campus community.

A screening of the film organized at Golden Gate University School of Law on October 25 by the Environmental Law Journal, Environmental Law Society, and American Constitution Society featured a discussion with Deborah Behles, an associate professor of law and clinical staff attorney at the GGU Environmental Law and Justice Clinic; Leila Monroe, an attorney for the Natural Resources Defense Council; and Thomas Azwell, a doctoral candidate in Environmental Science, Policy and Management at UC Berkeley.

Harvard Law School’s Environmental Law Society held a screening of Crude Justice on October 27. Following the film screening, a panel of students who performed pro bono legal work in the Gulf spoke about their experiences. The event drew a record number of attendees for a Harvard Environmental Law Society event.

On November 3, University of the District of Columbia School of Law chapters of the Environmental Law Society, American Constitution Society, and National Lawyers Guild brought together more than 50 students for an event that featured a screening of the film and a discussion with Danielle Franco-Malone, Dorot Fellow, Alliance for Justice, and Jenny Rasmussen and Kate Degravelles, attorneys with the American Association for Justice. Law professor John Brittain moderated the discussion. Event organizer Diane Saey opened the screening, saying “My hope is that, after the film and discussion, each student will leave with a quick, short list of ways to contribute toward the betterment of the environment.” At the conclusion of the event, scores of students pledged to join with the Alliance for Justice to monitor the situation in the Gulf Coast and urge BP CEO Robert Dudley to make the Gulf and its people whole again.

Crude Justice calls on all of us to join the fight for justice and full recovery in the Gulf. Sign up today to bring Crude Justice to your campus and community and ensure that the people of the Gulf continue to be heard!

Connect with Alliance for Justice online to stay updated on legal and environmental developments and take action to help the people of the Gulf.

Click here to view the 17-minute film online.

BP Oil and Dispersants Still Making People Sick

Tarballs on beaches, oil-covered wildlife, and destroyed lives and livelihoods aren’t the only effects from the Deepwater Horizon explosion and oil spill. It is being reported that the health effects of the dispersants BP used to “clean up” the oil may be getting worse rather than going away.

Al Jazeera has discovered that the next disaster along the Gulf may be a wide-spread health crisis.

“Compounding the problem, BP has admitted to using at least 1.9 million gallons
of widely banned toxic dispersants, which according to chemist Bob Naman, create
an even more toxic substance when mixed with crude oil. And dispersed, weathered
oil continues to flow ashore daily.

Naman, who works at the Analytical Chemical Testing Lab in Mobile, Alabama, has been carrying out studies to search for the chemical markers of the dispersants BP used to both sink and break up its oil.

According to Naman, poly-aromatic hydrocarbons (PAHs) from this
toxic mix are making people sick. PAHs contain compounds that have been
identified as carcinogenic, mutagenic, and teratogenic.”

People are suffering now and may in the future, and it is not at all clear how these people will be guaranteed health care or compensation. The $20 billion compensation fund set up by BP does not compensate victims for health problems, and only deals with lost income. The issue of long-term health effects and corporate liability for those impacts will likely remain unresolved for many years.

Add this to another of the many questions about how exactly BP plans to “make things right.” Learn more about the fight for justice in the gulf by viewing AFJ’s short documentary film, Crude Justice, at www.CrudeJustice.org

New Film, "Crude Justice," Documents an Uphill Battle for Oil Spill Victims

This morning we launched our new First Monday Film, Crude Justice. The film's narrator, Ed Begley, Jr. wrote a blog post on Change.org today to promote the film, which you can watch below.

April 20, 2010, was one of the worst days in our nation’s recent history. The explosion of the Deepwater Horizon oil rig cost 11 lives and did catastrophic damage to the ecosystem of the Gulf of Mexico. It also wrecked the lives and livelihoods of untold thousands of people who make a living in and near the Gulf.

As an environmentalist and as an American, it was heartbreaking to watch the live video of the hideous clouds of oil billowing out of the well all summer, knowing that every barrel was another blow to the environment, wildlife, and people of the Gulf. As the oil poured in, the lifeblood of the region drained out.

Although the oil no longer flows, Americans need to know that the crisis is most assuredly not over. No one knows exactly how much oil remains in the waters of the Gulf, but almost no one takes seriously early claims that three-quarters of it has miraculously vanished. The environmental and human effects of this calamity will certainly be felt for years. After all, oil is still present in the ecosystem of Alaska, over two decades after the Exxon Valdez spill. From Louisiana to Florida, shrimpers, oystermen, fishermen, motel owners, and countless small businesses that support the tourism and fishing industries have still not recovered. Some never will.

Inevitably, as the crisis unfolds, perhaps over many years, thousands of individuals, businesses, and organizations will turn to the legal system for justice and compensation. But what is the nature of the legal environment the victims of the disaster are facing as they turn for help to the courts or to BP’s $20 billion compensation fund? Can justice be found for the hard-pressed people of the Gulf?

That’s the subject of an important new film called Crude Justice that I was proud to narrate for Alliance for Justice, and which is being released today, October 4.

(Read the blog post in it entirety at Change.org)

Crude Justice from Alliance for Justice on Vimeo.

You can take action by sending a letter to BP here.

Ed Begley, Jr., Wants You to Watch Crude Justice

This week, renowned actor and activist Ed Begley, Jr., recorded the narration for our upcoming film, Crude Justice, about the legal challenges and uncertain future facing the victims of the Deep Water Horizon oil spill. Mr. Begley, whom you may know from his TV show on Green Planet, Living With Ed, or his many film and television roles, was kind enough to record this message urging concerned Americans to watch the film when it is released in October, and then get involved by hosting a screening of the film in your area, spreading the word, making a donation, or ordering the film.

We hope you enjoy his message and that you will get involved in this vitally important issue by visiting crudejustice.org.

P.S. If you have not seen the trailer for Crude Justice, you can watch it online. Then, be sure to come back in October to view the final film.

Another Oil Rig Explodes in the Gulf

It was just reported that another oil rig has exploded in the Gulf of Mexico. Thankfully, CNN is reporting that thirteen people have been accounted for, with one person injured. The rig, owned by Mariner Energy was not currently producing, and so this explosion will not result in hundreds of millions of gallons of oil being spewed into the Gulf.

UPDATE: The Coast Guard is now reporting that "a mile-long oil sheen is spreading from the site off an offshore petroleum platform that exploded in the Gulf of Mexico off Louisiana." This may be worse than we originally reported.

Just five months ago, the Deepwater Horizon explosion killed 11 workers and the disaster led to the largest off-shore oil spill in U.S. history. Though today’s explosion may not further pollute the waters off the shore of Louisiana, much of the oil from the BP explosion is still in the Gulf. Today’s accident should serve as a reminder of the risks that offshore drilling presents, and that the victims of the BP oil spill have only just begun to recover.

Earlier this week we released the trailer for our upcoming documentary Crude Justice: The Deepwater Horizon Oil Spill and the Search for Justice.

Shot on location in Louisiana, the film explores the damage done by the unimaginable environmental calamity to the lives and livelihoods of the people who depend on the waters of the Gulf of Mexico for their income, their food, and the continuation of their culture. The 15-minute documentary will look at the difficulties ordinary people face in finding fair compensation and a secure future for their families in the face of corporate domination of the courts, statutes favoring big business, judges with ties to the oil and gas industries, and the uncertainties that accompany an incident where the long-term effects may not be known for years.

We hope that you will take a moment to watch the Crude Justice trailer and think about the long road ahead for the victims of the BP oil spill.