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BP Business Economic Loss Claim Appeal 2016-1352: Absence of Sales Data Negates Tourism Designation Despit Claimant’s Location in Tourist Area

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The following is an Appeal Panel Decision issued pursuant to Section 6 of the BP Deepwater Horizon Economic & Property Damages Settlement Agreement and the Rules Governing the BP Appeals Process. Links may have been added to assist the reader. The original decision may be found here, as well as a glossary of BP Settlement terms

Claimant is a Zone C art gallery and interior designing entity that appeals its BEL award on a single basis. Claimant asserts that the Program erred by not assigning it a Tourism designation which would entitle Claimant to an RTP of 2.0 (in contrast to its assigned RTP of .25).
In support, Claimant refers to the fact that it is located in Galveston, Tx., a “tourist-rich” destination, and specifically in the XXX, described by no less an authority than Wikipedia as a “major tourist attraction.” Claimant asserts further that its premises is a few blocks away from the YYY, and caters to many cruise ship customers who embark or disembark there. Claimant admits that it no longer has access to sales documents for relevant years, but adds that as of 2014 records, 36% of its sales were to customers not residing in the Galveston area. As such, it argues that this location and this percentage of non-Galveston clientele entitle it to Tourism status under the definition of Exhibit 2 and Policy 289v2.
BP responds by noting that the NAICS code assigned to Claimant by the Program (453920-Art Dealers) is not one entitling Claimant to presumptive Tourism status under Exhibit 2. Acknowledging that Claimant may nevertheless attain Tourism status if it can establish its entitlement to same under the definition of Tourism in Exhibit 2, BP argues that under the data in this record, Claimant was unable to do so.
Under Policy 289v2, a Claimant must establish under a “totality of circumstances” standard whether it primarily catered to the needs of those traveling to Galveston from outside their home communities. Certainly no one would seriously dispute that the YYY, and specifically where Claimant’s business is located within said District, is a tourist mecca. Unfortunately for Claimant, the inquiry does not end there. A multiplicity of prior decisions of this panel have further required that Claimant establish, through its own sales data, that at relevant times its sales catered to the needs of those traveling from outside their home communities. Even if this panelist ignored the unavailability of records from before 2014 and simply projected a similar sales experience in prior relevant years, Claimant would be unable to meet the Tourism standard. Claimant itself admits that only 36% of its sales in 2014 were to non-Galveston customers. Indeed, even as to that 36% group, a sizeable number was from the Houston area, only about an hour’s drive away. Lastly, Claimant’s website, cited by BP, declares that Claimant “…creates interiors for a wide variety of projects.” This language leaves the distinct impression that rather than a tourist-based art gallery, Claimant is more of a design firm that happens to also sell art. There is no evidence in this record that Claimant’s design work comes to any significant degree from clients outside of the Galveston area.
For all of these reasons, this panelist, applying a “totality of circumstances ” standard, must agree with BP’s final proposal, which affirms the Program’s decision to decline Claimant a Tourism designation and corresponding RTP.

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