11182017Headline:

Tampa, Florida

HomeFloridaTampa

Email Tom Young Tom Young on LinkedIn Tom Young on Twitter Tom Young on Facebook Tom Young on Avvo
Tom Young
Tom Young
Attorney • (813) 251-9706

BP Business Economic Loss Claim Appeal 2017-667:Claim Denied Under Policy 467:Treated As Consolidated Claim For All Locations

0 comments
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

The Claims Administrator denied the BEL claim of this scrap metal company in Meridian, Mississippi (Zone D) for failure to pass causation. Claimant appeals, arguing that the Settlement Program erred in failing to consider its non-ferrous operation as a separate facility. Claimant argues that such a claim would pass the V-Shaped Revenue Pattern test.
A Google Map view of Claimant’s address demonstrates a number of buildings and structures on the property. Financials from the non-ferrous division pass causation while those from the other divisions do not. As reflected in the Calculation Notes, the program accountant combined the financials into a single consolidated claim based on the fact that all three divisions are located at the same address. The Claimant owns a scrap metal business with three divisions. The claimant initially waned to file a separate claim for only one of the divisions located at Meridian, MS 39301. The Claimant stated that the other two did not pass causation. The Claimant provided separated financials and consolidated federal income tax returns. The Claimant also provided a consolidated annual P&L for 2008-2011 for tax reconciliation purposes.
After further review, Accounting Review received clarification that all three divisions are housed at the Meridian, MS location. Policy 467 states that all business operations housed at one physical address must be considered one facility for the purpose of the claim calculation. Accounting Review used the consolidated P&Ls for the causation and compensation calculations in this workbook and processed the claim as a single-facility BEL claim.
Claimant argues that the non-ferrous facility is located in a distinct warehouse that is separate from its operations and that under Policy 467, the non-ferrous division should be treated as a separate Facility. Claimant bolsters this position with an interesting interpretation of Policy 467. Claimant argues that this policy does not say that all structures at one address must be considered the same facility. Claimant instead argues that Section V. E provides that a “warehouse owned, operated or
leased by an Entity and used in the normal course of operations will typically be considered a Facility.”
BP characterizes Claimant’s argument as an effort to carve out only portion of its financial data in order to create a loss where the overall facility cannot satisfy causation. BP describes Claimant’s site as one contiguous, indistinguishable, multi-building facility that is located at one address. BP points out that Policy 467 requires that Claimant’s divisions be located at “separate and distinct physical structure or premises,” in order to present separate claims, a factor that is missing here.
After de novo review, this panelist is unpersuaded by Claimant’s argument. Claimant’s operation at Meridian, Mississippi is not a separate and distinct physical
structure or premises within the meaning of Policy 467 or the Settlement Agreement. The Settlement Program was correct in treating this as a consolidated claim for a single facility. Accordingly, Claimant’s appeal is denied

Leave a Comment

Have an opinion? Please leave a comment using the box below.

For information on acceptable commenting practices, please visit Lifehacker's guide to weblog comments. Comments containing spam or profanity will be filtered or deleted.