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BP Guilty of Criminal Charges, Will Pay $4 Billion, Uncapped Civil Settlement a Consideration

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Over the last several months, we have extensively covered the BP Economic Loss and Property Damages Settlement that was reached in March of last year. The Settlement is an important and necessary step in providing thousands of affected businesses and residents the financial compensation they are owed for post-spill losses. But, in the minds of many, providing compensation through the Settlement is only part of the story.

Holding BP to account—criminally—for its actions that led to the massive oil spill, is a critical component in disciplining BP for its actions in the Gulf. In addition to the many lawsuits brought by plaintiffs seeking financial recovery through the civil justice system, BP has also faced multiple criminal charges initiated by the Justice Department. At the end of last month, that criminal case came to a conclusion when Judge Sarah S. Vance of the Federal District Court in New Orleans approved a plea agreement between BP and the Justice Department.

As part of the plea agreement, BP, as a company, pled guilty to 14 criminal charges. Those charges included 11 felony counts of misconduct or neglect in relation to the deaths of 11 people in the Deepwater Horizon accident. BP also pled guilty to one felony count of obstruction of Congress in connection with the company providing inaccurate information to the public during the event. Finally, BP pled guilty to violations of the Clean Water Act and the Migratory Bird Act. In all, according to the terms of the plea agreement, BP will pay $4 billion in criminal penalties.

While that fine appears substantial, an important consideration made by the Court in approving the plea deal was BP’s agreement to an uncapped civil settlement with business and individual claimants. The uncapped nature of that civil settlement likely influenced Judge Vance to approve the $4 billion criminal fine, a number some observers felt was too lenient.

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