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BP Business Economic Loss Claim Appeal 2016-1381: CA Reallocates Revenue Equally Between Months of No Income and Double Income; Claimant Fails Causation

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Claimant appeals the denial of its BEL claim which the Claims Administrator determined did not pass causation.
Claimant is a medical staffing company based in Metairie, Louisiana that provides services to a medical facility in Covington, Louisiana for which it receives a monthly fee of $42,650. This amount remained consistent throughout the Benchmark and Compensation periods. Claimant’s financial statements revealed months where it
recorded no income, followed immediately by a month in which it received $85,300. An exception to this was September 2008 and May 2009 where increased income was not preceded by a month of no income.
Recognizing that the services did not vary from month to month, the Program reallocated the revenue received in the months where $85,300 was recorded and divided it equally with the previous month where no revenue was recorded.
On appeal, Claimant takes issue with the Program’s approach and analogizes to a previous Appeal Panel decision which reversed and held that there was no basis for reallocating revenue before applying the matching criteria under Policy 495. While several panel decisions did follow that logic, the District Court has clearly indicated that the Program may, in its discretion, reallocate revenue when necessary to achieve appropriate matching before applying any accounting methodology in Policy 495. The Program appropriately did so in this case.
Claimant further contends that the September 2008 and May 2009 extra payments were a bonus that should not have been reallocated. The Summary of Review by the Program clearly establishes that these months were not adjusted and, despite this, Claimant still failed to pass causation. The appeal is denied.

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