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Tom Young
Tom Young
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BP’s Supreme Court Bid is Nonsensical

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BP, having been rebuffed numerous times by multiple courts, now seeks to enlist the Supreme Court of the United States to help the company escape liability for this Nation’s worst environmental disaster. The Justices should deny BP’s petition.

“Your Honor, causation is not the issue”

Before BP’s change of heart regarding the Settlement Agreement the company itself authored and executed, BP enthusiastically lobbied Federal District Court Judge Carl Barbier for approval of the contract, arguing that the causation standards and Claims Administrator Patrick Juneau’s application of same were “economically appropriate” and “consistent with . . . economic reality.”

The company subsequently told the 5th Circuit Court of Appeals that it had no complaints about the method in which a claimant’s loss was determined to be causally related to the disaster. Listen as BP attorney Ted Olson tells 5th Circuit Judge Edith Clement, “This is a settlement, and with respect to the causation issue, that is not the issue that is before this court” (starting at 6:33).

But now BP is asking the Supreme Court to review causation? How is that even possible? BP never objected to the Claims Administrator’s implementation of the causation policy. BP never appealed the District Court’s affirmance of that policy. Finally, BP defended same at the 5th Circuit.

When ruling that BP was judicially estopped from taking a position counter to its earlier position, Judge Barbier called BP’s antics “not inadvertent” and “deeply disappointing.” The application of judicial estoppel is designed to prevent one litigant from playing fast and loose with the courts. There could be no better example than this.

Now, two years later, as public outrage of oiled beaches and birds has waned, BP faults the 5th Circuit, Judge Barbier and Administrator Juneau in their approval and application of the very standards the company previously endorsed. In response, Judge Barbier determined that BP is endeavoring to “systematically rewrite” the terms of its own “unambiguous Settlement Agreement” – a contract – long after the ink dried. Apparently, this is what a company spending well in excess of $2 billion on attorneys and misleading advertisements feels it can get away with.

Eating my cake and your cake too

Meanwhile, while 15,028 claims have been approved under this construct, 28,771 have been denied. Put another way, using the causation formulas BP now attacks, nearly 29,000 businesses have failed to demonstrate the necessary causal nexus between BP’s spill and their economic losses. Based on these numbers, if anyone should be complaining it is the Plaintiffs, not BP.

BP’s tired allegations about “fictitious” claims can all be refuted, or at least debated by, reasonable minds. Even BP’s hometown newspaper, The Times of London, last month called BP on the carpet saying “it emerged that not all the cases BP complained about were quite as cut and dried as the company made them appear.” Then in late November 2014 a third-party independent audit commissioned by BP found that over 99.5% of all claims were processed and paid properly by Mr. Juneau’s Claims Administration. The auditor, Chicago-based McGladrey, LLP, called the program “well designed.”

This brings us to why litigants choose to settle in the first place. In a litigation setting, if debated factual situations were “cut and dried,” there would be no appetite for settlements. Both sides do the math, weigh the risks of trial and then choose to fish or cut bait. If they settle, they don’t litigate. When they don’t litigate, there is no trial. If the BP Settlement violates the Constitution because the Plaintiffs didn’t have the opportunity to prove their legal entitlements to a jury, then every settlement violates the Constitution. Public policy does not favor such a viewpoint.

Our word is our bond

And what of the sanctity of contract? Or phrased differently, the concept that a deal-is-a-deal? Tens of thousands of businesses were impacted by BP’s disaster, from mom-and-pops to Fortune 100 entities. According to Harvard University’s Kennedy School of Government, 50,000 people lost their jobs and 10,000 corporate bankruptcies were filed in the months that followed the spill – in Florida alone. These businesspeople relied upon BP’s word, handshake and written contract, voluntarily ceding their Article III rights to trial by jury by entering into this alternative compensation system, only to be told two years later “nevermind, we didn’t mean it.” It is an outrage.

Finally, there is nothing in BP’s Petition for a Writ of Certiorari with the Supreme Court that should interest the Justices. Aside from the fact that BP has been judicially estopped from even making such arguments, there are no compelling reasons to hear this case, despite BP’s theatrical protestations to the contrary in its court filings and public relations efforts.

Most importantly, there is no circuit conflict at issue here. While the federal circuits have applied two slightly differing tests to determine Article III standing in class actions, known by their case names as Denney and Kohen, the 5th Circuit Court of Appeals, when hearing BP’s arguments below said “This case is not a vehicle … for us to choose whether Kohen or Denney articulated the correct test. For the purposes of the present case, these questions are entirely academic because BP’s standing argument fails under both.”

In a related opinion, 5th Circuit Judge Leslie Southwick, a George W. Bush appointee, concluded that “there is nothing fundamentally unreasonable about what BP accepted but now wishes it had not.” Fellow 5th Circuit jurist, Judge Eugene Davis, a Reagan nominee, said “ … the reason that BP has identified no [legal] authority for [its] proposition is that it is nonsensical.”

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