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BP Business Economic Loss Claim Appeal 2016-2181: Catering Company Factors Outside Its Control That Prevented recovery of Revenues in 2011

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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.

BP appeals the BEL award ($677,766.53 pre-RTP) to Claimant , a Slidell, Louisiana company that provides catering and other services primarily to the film industry.
Claimant’s financials triggered Policy 495 matching criteria and the claim proceeded under the Annual Variable Methodology. BP’s Notice of Appeal is somewhat vague but the memoranda clarify its position that the claimant has not satisfied the second prong of the Decline-Only revenue test by presenting “specific documentation identifying factors outside the control of the claimant that prevented the recovery of revenues in 2011.” Among the factors provided as examples of such outside factors in Exhibit 4 is the entry of a competitor in 2011. BP acknowledges that provided documentation of many competitors but contends that such information is insufficient and requests the claim be remanded for further investigation.
BP argues that all of the competitors cited by the claimant were already “players” in the market before 2011. In support of this contention, BP provides copies of the Secretary of State’s printouts showing that these competitors were registered to do business prior to 2011. BP contends that the growth of the film industry produced an increased demand for catering services and that failed to show why its market share failed to rebound in 2011, despite the advent of additional competition. Although
provided sworn affidavits from one of its owners and another from an unaffiliated production coordinator, BP dismisses one as “self-serving” while ignoring the other.
In contrast, Claimant provides a thorough response that refutes BP’s position point by point. It argues that the mere fact that a business was registered prior to 2011 sheds no light on the operation of the business or its role in the marketplace. Claimant provides strong evidence of competition from at least nine new competitors in 2011. This panelist finds the affidavit of ***, the independent production coordinator, to be particularly compelling.
Claimant clearly outlines the entry of several on-set caterers in South Louisiana in 2011. After a thorough review of the record, this panelist concludes that BP’s argument is speculative at best and is insufficient to overcome the record evidence that the Program found satisfactorily satisfied the Decline-Only test. There is no basis for remand and no support for BP’s final proposal of $0. Accordingly, the award is confirmed and the appeal is denied.

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