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BP Business Economic Loss Claim Appeal 2017-1492:Exhibit 4B Requires That Claimant Be Operational At The Time of The Spill

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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 producer of construction aggregates with multiple facilities throughout the Gulf Coast. The claim is for its Port Manatee location in Palmetto, Florida. Its Business Economic Loss claim was denied by the Settlement Program based on the determination that Claimant was “not doing business or operating in the Gulf Coast Areas or Specified Gulf Waters at the time of the Oil Spill, April 20, 2010.” Claimant asserts that it was operating at the time of the spill.
The sequence of operation was evidenced by general counsel and officer who explained the facility “was in operation at all times during the years 2007 through 2011, and … is still in operation today.” The affidavit states that prior to 2009, the facility was engaged in unloading ships docked at the port primarily for one customer with sporadic revenue and expenses. At that time Claimant did not have a plant at this location, so any materials unloaded had to be immediately transported by its
customers. Claimant’s revenue had been based entirely on port activity.
However, in 2009, Claimant began working to build a plant at the Port Manatee facility, so that it could maintain inventory, serve more customers, and generate a steady stream of income. The plant opened in 2010 and resulted in the Port Manatee facility generating revenue again in October 2010. The unloading facility was never shut down or out of operation during the construction of the plant.
BP argues in support of the denial that Claimant did not earn any revenues for two years (when Claimant concedes the port was not used), and instead Claimant’s dramatic drop in operating expenses from 2008 to 2009 indicated that Claimant ceased operations at the time of the Spill, only to re-open in the fall of 2010, after the Spill, when the new plant was complete.
Claimant argues that there is no requirement that it must be earning revenue at the time of the spill and cites to other appeal panel decisions that have so held. The key to this decision whether Claimant was operational during the spill, and if so Policy 308 v.2, a court-ordered policy, “provides that no additional analysis is to be undertaken” when the objective causation requirements of Exhibit 4B have been met.
It is this Panelist’s decision that Claimant was operational at the time of the Spill and according to that alternative standard it is due to recover. Therefore, the denial of this claim should be reversed.

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