BP share price: Judge upholds ‘gross negligence’ Gulf spill ruling
iNVEZZ.com, Friday, November 14: BP plc (LON:BP) has lost a bid to overturn a ruling that it was guilty of ‘gross negligence’ over the 2010 Gulf of Mexico oil spill, with the decision leaving the group exposed to $18 billion (£11 billion) in penalties for violations of the Clean Water Act.
The decision is the latest legal setback for BP which earlier this week also failed to oust the claims administrator overseeing payouts in relation to the group’s settlement with the US government.
BP’s share price has lost about 0.9 percent in London so far in today’s session.
*h*‘Gross negligence’ ruling upheld*h*
US District Judge Carl Barbier in New Orleans yesterday refused to overturn his own finding that BP’s exploration unit was grossly negligent over the Deepwater Horizon incident which resulted in the largest offshore spill in US history.
While in September Barbier ruled that BP had committed gross negligence and was 67 percent at fault for the spill, the company had been arguing that his ruling was based on evidence which he had previously agreed to exclude from the trial. (BP share price: Group challenges ‘gross negligence’ Gulf spill ruling) The evidence is related to testimony from an expert witness called in by Halliburton (NYSE:HAL), the company which provided the cement used to seal the Macondo well.
Reuters yesterday quoted Barbier as saying in his newest ruling that BP had “opened the door to this testimony” through a cross-examination of the expert.
“”BP was a ‘victim’ of its own trial strategy””
“BP’s assertions that it was ‘unfairly surprised’ and ‘prejudiced’ by the court’s reliance on this testimony lack any basis in fact or law,” Barbier wrote, adding that it seemed that “BP was a ‘victim’ of its own trial strategy”.
BP said yesterday in a short statement that it disagreed with the court’s ruling and would move forward with its appeal of the September decision.
A finding of gross negligence could raise the Clean Water Act fine for the UK group to $4,300 per barrel spilled, compared with $1,100 per barrel in the case of ordinary negligence. Barbier has set a trial for January to calculate the penalty.
*h*Judge rejects BP’s efforts to oust Juneau*h*
Earlier this week, Barbier also rejected BP’s bid to remove Patrick Juneau, the claims administrator who oversees the payouts of the company’s 2012 settlement.
BP has long been arguing that Juneau’s interpretation of the settlement has resulted in payments of hundreds of millions of dollars to businesses which were not required to prove their losses were directly tied to the spill.
“”BP claimed that Juneau had a conflict of interest””
In its latest attempt to limit the cost of the settlement, BP claimed that Juneau had a conflict of interest because he had briefly represented Louisiana in the early days of the spill.
Bloomberg on Monday quoted Barbier as saying that BP should have complained sooner about any potential bias.
“It is beyond cavil that BP had actual knowledge of Mr Juneau’s previous consulting work on behalf of the state of Louisiana,” the judge pointed out.
BP said that it strongly disagreed with the court’s decision and was considering its appellate options.
As of 09:00 GMT, buy BP shares at 425.15p.
As of 09:00 GMT, sell BP shares at 425.05p.
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