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 operates a residential and commercial landscaping and lawn care business on Orrville, Alabama. The Settlement Program denied its claim on the basis that Claimant’s financial data did not satisfy Exhibit 4B’s V-Shaped Revenue Pattern Test. Claimant appeals on the basis that the Settlement Program erred in restating revenues in the affected months to the months in which they where due based on a response by Claimant to an inquiry from the Settlement Program’s Accountants, i.e. the Settlement Program applied the adjustment to allocate Claimant’s revenues into the months when Claimant stated the revenues was earned. This adjustment caused Claimant to be unable to satisfy the V-Shaped Revenue Pattern Test, thus Claimant failed to qualify for an award.
Claimant challenges the Settlement Program’s authority under Policy 495 to restate mismatched revenues on its P&Ls, and adopts Plaintiff’s Steering Committee’s brief on this controversial issue. Basically, the Committee asserts that initially the Settlement Program under Policy 495 can only correct “errors,” and that first step reallocation argument by BP has been rejected by other Appeal Panelist. While this panelist concedes that there appears to be some conflict in the decisions on this issue, this panelist sides with those that hold that when, as here, a cursory examination identifies the anomaly, the specific information is immediately available upon inquiry, and the appropriate allocation readily apparent, the Claims Administrator has an obligation to make the corrective entries. The Program Accountants, exercising their professional judgement, in their discretionary are permitted to adjust Claimant’s P&Ls as to the “timing of the recognition of…revenues” under these limited circumstances. These limited adjustments to address matching issues may be made in addition to any correction for “errors.” Claimant’s appeal is denied.