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BP Business Economic Loss Claim Appeal 2017-389: Objective, Third-Party Evidence Required To Prove Factors Outside of Claimant’s Control Prevented Recovery

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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, who is in the used car business, appeals the denial of her BEL Claim. Claimant failed Causation. The Program determined that the Decline-Only
Test applied to Claimant. Although Claimant met the first prong (Revenue Decline)of this test, Claimant failed the second prong (Additional Analysis). Specifically, the
Program concluded that Claimant had not provided sufficient documentation to show that factors outside of Claimant’s control prevented Claimant’s revenue from
recovering in 2011.
Claimant offers a novel, and frankly common sense, reason why her revenues didn’t rebound in 2011 – the Spill. Claimant argues that because many of her customers were financially effected by the Spill, her sales declined after the Spill. Further, she contends that the Spill continued to affect her customers in 2011, thus preventing her sales from rebounding in 2011.
This Panel is sympathetic to Claimant’s position. Anecdotal evidence suggests that there might be a basis for Claimant’s argument. Unfortunately for Claimant, the Settlement Agreement is quite clear as to the type of documentation required to pass the second prong of the Decline-Only Test. The Claimant must submit “objective, third-party” documentation showing that factors outside of Claimant’s control prevented the rebound of revenue in 2011. The Settlement Agreement provides several illustrative examples of such factors, such as “the entry of a competitor in 2011” and “bankruptcy of a significant customer in 2011.”
A fair reading of the Settlement Agreement reflects that the Spill is not one of those outside factors contemplated by the Settlement Agreement. The Panel agrees
with BP that if the Spill were considered an outside factor, then every Claimant subjected to the Decline-Only Test would pass the second prong. Certainly the
Settlement Agreement did not intend that result.
In light of the above, the denial of this Claim is upheld.

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