Monday, June 11, 2012
BP DEEPWATER HORIZON SETTLEMENT UPDATE
On May 2, 2012 the federal court overseeing the Multi-District Litigation (MDL) related to the April 2010 Deepwater Horizon oil spill preliminarily approved two class settlements. One settlement covers economic damages suffered by individuals and businesses as a result of the oil spill. The other settlement covers medical claims by individuals who were injured by the spill. The total settlement package is valued at $7.8 billion, but there is no cap on the amount that may be paid under the settlement.
The proposed economic damages class is defined broadly and includes individuals and businesses located in Alabama, Mississippi, and Louisiana and certain areas of Florida and Texas. Such individuals and businesses may have a claim if they can demonstrate they suffered damage as a result of the oil spill in any number of different categories. These categories include:
- Loss of income, earnings or profits
- Coastal real property damage
- Wetlands real property damage
- Real property sales loss
- Start-up business economic loss
- Failed business economic loss
Of note, an individual or business does not necessarily have to reside or be headquartered near the Gulf Coast to have a potential claim under the proposed settlement. For example, a business headquartered in Alabama that can show certain revenue loss patterns over any three consecutive months between May and December 2010 may be eligible for payment under the settlement. See this document for an overview of the geographic areas covered by the settlement. Many claimants may also be eligible to receive an additional amount (defined as a Risk Transfer Premium under the proposed settlement) to cover potential future damages and punitive damages.
Most types of businesses are included in the proposed class. However, entities in the following industries are generally excluded from making claims for economic damages under the proposed settlement: banking, gaming, financial, insurance, oil and gas, real estate development, defense contractor industries, and entities selling or marketing BP-branded fuel (including jobbers and branded dealers). Nevertheless, entities in the above industries are not precluded by the settlement from making claims outside the settlement and some entities in the above industries that meet certain exceptions defined in the proposed settlement may still be eligible (e.g., real estate developers may make claims under the settlement for real property damage or real estate sales damage). Thus, you should consult an attorney or the proposed settlement agreement to determine potential eligibility.
Although final approval by the Court will not be issued until after a fairness hearing in November, the Court has issued preliminary approval and authorized the new settlement administrator to begin processing claims after June 4, 2012.
If you believe you or your company may be eligible for payment under the proposed settlement, we would be happy to talk to you about available options for further evaluating and pursuing your claim.
This Client Alert is for information purposes only and should not be construed as legal advice. This information is not intended to create, and receipt of it does not constitute, a lawyer-client relationship. For more information or an explanation about the matters discussed in this Alert, please contact one of the attorneys listed above.