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BP appeals Gulf oil spill settlement to Supreme Court
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BP appeals Gulf oil spill settlement to Supreme Court

Article by David Hammer, WWL-TV, Source: USA Today

NEW ORLEANS - BP filed a formal petition to the U.S. Supreme Court claiming that lower courts in New Orleans erroneously approved a multibillion-dollar settlement that is paying claimants that were not hurt by the company's 2010 oil spill.

The petition, filed last Friday, had been expected since May, when the U.S. 5th Circuit Court of Appeals rejected BP's attempts to undo the massive damage settlement it agreed to and helped craft in 2012. BP already asked the high court to keep in place a stay on business claims payments that it is challenging. The Supreme Court denied that application in June.

The British oil giant officially urged the Supreme Court to take the case Friday, arguing that several other circuit courts have found that class-action settlements should not be approved if they include people and businesses that were not actually hurt by the defendant's actions.

BP contends that its settlement with private plaintiffs was "hijacked" by court-appointed claims administrator Patrick Juneau because of how Juneau is determining claimants' eligibility. In the petition filed Friday, BP says Juneau has paid "more than $76 million to entities whose losses had nothing to do with the spill, as well as an additional $546 million to claimants that are located far from the spill and are engaged in businesses whose revenues and profits bear no logical connection to the spill."

BP has lost previous arguments on this question before U.S. District Judge Carl Barbier and the 5th Circuit appellate court because evidence shows that BP agreed to a settlement in which a business claimant's losses are assumed to come from the oil spill if that claimant is located in certain zones along the Gulf Coast and meets a basic formula for lost revenues and recovery.

BP has changed directions on its argument in the last year. BP lawyer Ted Olson, a former U.S. Solicitor General, initially argued in the 5th Circuit that BP agreed to pay businesses whose losses were not from the spill as part of a compromise, then later claimed that it should not have to pay anyone whose losses were from anything other than the spill.

The Supreme Court could decide in October whether to hear BP's appeal.

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