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BP Business Economic Loss Claim Appeal 2016-219: Non-construction NAICS properly treated under construction methodology


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, a Montgomery, Alabama business that provides forestry related management and consulting services, filed this BEL Claim. The Claims Administrator (CA) determined that Claimant’s financials were not sufficiently matched. Claimant’s NAICS Code does not automatically require that the CA apply the Policy 495 Construction Methodology. The CA chose to apply the Construction Methodology to Claimant’s financials and awarded the sum of $142,743.23 (pre – 0.25 RTP).

BP appeals asserting the CA should have applied the AVM Methodology which would have made the award $76,217.00 (pre – 0.25 RTP). The CA in the Calculation Notes and in response to a Request for Summary of Review states:

“…. since revenue is recognized when invoiced, and invoicing could span from one week to 90 days, DWH Accountant determined that monthly revenues were not regularly recorded in the period in which the work was performed. As such, the DWH Accountant determined that the Construction Methodology was best suited to achieve sufficient matching.”

Policy 495 authorized the CA’s professional staff to apply its professional judgment as to which Methodology to use after its review of Claimant’s financials. After a de novo review of the record in this matter, this Appeal Panelist does not find that the CA’s staff erred in applying the Construction Methodology.

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