${site.data.firmName}${SEMFirmNameAlt}
Ouch! BP Should Have Been More Careful For What It Wished For
Practice Areas
back to top

Ouch! BP Should Have Been More Careful For What It Wished For

In the latest slap to BP's (NYSE:BP ) face, the audit has been made public of the very process for business economic loss claims BP has been fighting. I've written extensively about BP's unfunded and unexpensed billions of dollars of business economic loss claims that still dangle dangerously over the company. BP and its defenders have screamed and called foul, claimed fraud, claimed a biased unfair legal system, claimed miscalculations, you name it. BP even tried to get the very claims administrator it appointed thrown out.

The claims administrator underwent a third-party audit, and BP had been demanding to hear the results of that audit, presumably expecting to find out dirty secrets about the claims process. Well, BP finally got its wish but I doubt it is too pleased with the results. Despite the battle cries, which are often unfounded yet echoed throughout in the Seeking Alpha comment sections of various articles, the audit found the program "well-designed and appropriate" with no recommendations for improvement as 99.5% of the claims were found to be calculated accurately.

BP is hoping the Supreme Court takes the case. I will say given this audit, the already low odds of the Supreme Court taking the case just got knocked down a notch. Add to that, I'm not so sure it's in BP's best interest to be in front of that court. Given its terrible legal track record that includes bouts of crying wolf, the best court of action for BP at this point is to throw in the towel, let the claims get processed, and allow the deadline for new claims to be established and expire instead of digging its own grave any further.

So what does this all mean for BP the company and the investment? It would seem any further appeal attempts aren't going to get far now that a neutral third party performed an audit, at BP's request, and it left the claims administrator smelling like roses. On the one hand, this is good, because I think it is BP's interest to quit fighting a battle it can't possibly win from here forward. The settlement calls for a deadline to be set six months after the last appeal is exhausted so the sooner BP throws in the towel the sooner the mess will end and ultimately lower its bill as new claimants get cut off.

The bad news is this audit all but certainly leaves at least up to $7 billion more in claims coming by my calculations, and but here's the wild card. According to claims administrator Patrick Juneau, once the deadline is established and the six month clock begins, there may be a "surge" in claims pouring in. "It's happened in every case I've been involved in, and there's no reason to believe it would be otherwise in this case," Juneau stated.

This surge could be from businesses waiting until the final official rules are in place, procrastinators, and new marketing push by law firms. Also the successful audit itself may have brought comfort to potential claimants to move forward.

No Comments

Leave a comment
Comment Information
As your legal advocates we protect your rights, and help calm the waters.
Contact Our Office Now

Have questions? Contact us to set up a consultation.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Aloia, Roland, Lubell & Morgan, PLLC
2254 1st Street
Fort Myers, FL 33901

Toll Free: 800-724-7902
Phone: 239-603-6143
Fax: 239-791-7951
Map & Directions

Email Us