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Tom Young
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BP can’t handle the truth

Photo courtesy of methodshop.com.

Photo courtesy of methodshop.com.

BP is known to play fast and loose with the facts, with the above particularly memorable “lapse” discovered in the Summer of 2010 by a reporter at Ameriblog of a faked and photo shopped image of BP’s emergency command center. And while the oil major does a masterful job of media control and public relations spin, one would not expect BP to be so bold as to be less than forthcoming (to put it diplomatically) with Federal Judges, but that appears to be what BP spokesperson Geoff Morrell has suggested in recent interviews and on BP’s propaganda web site.

In an interview earlier this month with 60 Minutes correspondent Scott Pelley, Morrell said “No company would agree to pay for losses that it did not cause, and BP certainly did not when it entered into this settlement.”

But as I have pointed out before, and my friend J.R. Whaley discussed more recently, BP’s attorneys told at least four Federal Judges – in open court – just the opposite. In fact, both J.R. and I were in the courtroom at the time and heard the proclamations loud and clear.

For instance, when seeking District Court approval of the Settlement Agreement in November 2012, BP attorney Richard Godfrey, with the venerable firm of Kirkland & Ellis, told Judge Carl Barbier the following:

“We have presumed causation in Zone A. We’ve presumed causation. It’s irrebuttable. You know as well as I do, Your Honor, how many people come in and think they have got a claim damage for economic loss; but, when the facts come out, they had a bad year because they lost their key manager, they had a bad year because the street was being repaired in front of them, whatever reason. We’re presuming causation for whole sections of the settlement class depending on where you reside and the nature of your business.”

Then, less than one year later, BP attorney and appellate stalwart Ted Olson with Gibson, Dunn & Crutcher had this to say to Judges Clement, Dennis and Southwick of the 5th Circuit Court of Appeals:

“This is a settlement. … It was a compromise, which every settlement agreement is. With respect to causation issues, some businesses that are very close to the spill, the causation issue is waived entirely. . . .” (July 8, 2013 during exchange with Judge Clement beginning about 6:33)

So which is it BP?

Mr. Morrell’s version or what your lawyers have said in court?

While plaintiff counsel did not and is not seeking payment for those uninjured by BP’s disaster, it is important to note that BP did in fact propose, agree to, and champion a system which could result in the appearance of so-called “false positives.”

But why? Was it intentional? Perhaps.

Court of public opinion

BP’s media team is led by former Pentagon press secretary Geoff Morrell. Mr. Morrell is a veteran spinmeister and his team is well versed in media manipulation. By designing a payment system that could generate a few dozen seemingly questionable claims (to the untrained economic eye) out of 200,000 or so total claims, BP provided Morrell & Co. with fodder for the papers and Sunday talk shows.

BP, looking to suppress participation in the payment program, played the victim card, using as “evidence” a handful of poster-child “fictitious claims” to bolster the company’s position that it was being taken advantage of by unscrupulous lawyers, judges and really anyone who lived in the southeastern United States.

The problem is, upon closer inspection, BP’s “fictitious” and “undeserving” claims turned out to be anything but.

The butcher, the baker, & the candlestick-maker

BP first complained of a car dealer that was compensated under the precise terms of the Settlement. BP said the reason the dealer qualified was not loss of business due to the economic fallout from its spill, but rather the discontinuance of the Pontiac brand from its lineup. BP said this was a “fictitious claim.”

But unfortunately for BP, the pesky facts got in the way.

This dealer tried unsuccessfully for the entire Summer and Fall of 2010 (during the spill) to secure a new franchise to replace Pontiac. Prior to the spill the dealer had three other automakers bidding for his business. BP’s spill ended those talks.

Next up, an RV park foreclosed upon before the spill won, according to BP, a windfall payment from the settlement program. The horror! This, said BP, was most certainly a “fictitious claim.”

But unfortunately for BP, the pesky facts got in the way.

This was a not an RV park that had closed its doors, it simply had a foreclosure action filed against it. Any underwater homeowner over the past half decade knows that the initiation of a foreclosure suit is just the beginning of a multi-year process which often results in a restructuring or other compromise solution.

The RV park in question remained open through the spill year of 2010 while it attempted to negotiate with the bank. Alas, BP’s spill ended those negotiations. Additionally, but for the spill, the owner would have been able to enjoy the benefits of the Federal Foreclosure Relief Act to refinance. Yet the lack of tourism post-spill precluded such relief. As a result, the business was eventually lost, due in no small part to BP.

Next up on BP’s list of “fictitious claims” is a mobile phone retailer whose store had burned to the ground before the spill.

Yet again for BP, the pesky facts got in the way.

This company was shovel-ready to use its insurance money to move to a different adjacent location and restart the business, but failed to be able to do so as there was simply no customer base left to sell to. Further, financing offered before the spill was rescinded post-spill by two local banks. Hard to make money or reopen a business after a fire when BP’s disaster changed the macro-economic landscape in the region.

Judge: BP’s change of heart intentional

It has become apparent to even casual observers that BP has intentionally cherry-picked claims and particular claimants for public flogging in an attempt to frighten away other businesses from participating and receiving compensation rightfully owing. Unless one takes the time to read articles like this one, the public could be forgiven for buying into BP’s made-for-TV sound bites. But the facts belie BP’s outrageous claims.

In closing, it’s good to know that the judiciary is not so easy hoodwinked.

Judge Barbier in November 2013:

“BP accuses the Claims Administrator of ‘rewriting’ and ‘systematically disregarding’ the Settlement Agreement. To the contrary, when it talks about causation, if anyone is attempting to rewrite or disregard the unambiguous terms of the Settlement Agreement, it is counsel for BP.

“Frankly, it is surprising that the same counsel who represented BP during the settlement negotiations, participated in drafting the final Settlement Agreement, and then strenuously advocated for approval of the settlement before this Court, now come to this Court and the Fifth Circuit Court of Appeals and contradict everything they have previously done or said on this issue. Such actions are deeply disappointing.”

Judge Barbier in December 2013:

“The Court further finds that BP’s change of position was not inadvertent.” – Judge Carl Barbier, Order & Reasons, December 24, 2013

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