U.S. Opposes Delay in BP Oil Spill Trial

By | May 2, 2012

The U.S. government said a trial to assign blame and damages among BP Plc and others over the 2010 Gulf of Mexico oil spill should not be delayed until after a hearing over a $7.8 billion settlement of private party claims.

BP has asked U.S. District Judge Carl Barbier in New Orleans to delay any trial over the spill until after he holds a Nov. 8 fairness hearing over the settlement of more than 125,000 economic, property and medical claims.

A trial on those claims, as well as on claims by the federal government and Gulf Coast states, was originally scheduled for Feb. 27 before being put on indefinite hold. BP’s request could push the start date at least into 2013.

But in separate court filings on Tuesday, the U.S. government and Alabama Attorney General Luther Strange, who coordinates state interests with his Louisiana colleague James “Buddy” Caldwell, said BP’s requested delay is unfair to residents, and that any trial should begin this summer.

The proposed settlement should not “impede trial and resolution of the broader public interests represented by the United States and the states,” the federal government said.

Strange said that granting a delay could cause the trial to be pushed back even further, perhaps as late as 2015.

“BP’s motion sets the groundwork to avoid a trial versus the governments for years to come,” Strange said. “The governments deserve our day in court.” He proposed a trial date of July 16.

In a court filing last month, BP said delaying any trial until after a fairness hearing would help ensure that any “overlapping or parallel actions” would not distract the court from administering a settlement.

A $7.8 billion accord by BP with private plaintiffs would be one of the largest class-action settlements in U.S. history. There is no cap, and the ultimate payout may be higher or lower.

The April 20, 2010 explosion of the Deepwater Horizon drilling rig killed 11 workers and triggered the largest U.S. offshore oil spill from BP’s ruptured Macondo well.

About 4.1 million barrels of oil were spilled and not cleaned up, the U.S. Government has estimated. BP still faces claims from the U.S. government; Gulf states; and drilling partners Transocean Ltd., which owned the rig, and Halliburton Co., which provided cementing services.

Barbier has said he plans to meet privately with the parties on May 3 to discuss scheduling and other matters.

Earlier Tuesday, BP reported lower-than-expected quarterly profit, in part because of spill-related costs.

The case is In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.

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