BP oil spill payments stalled in wrinkle over fees
Damage payments from the compensation fund for BP's massive oil spill in the Gulf of Mexico have been stopped temporarily because officials need time to comply with a court order to set aside money to pay hundreds of lawyers. The Gulf Coast Claims Facility, which was set up to handle claims against BP, says payments would be halted to comply with a Dec. 28 order by U.S. District Judge Carl Barbier. The order requires that 6% of payments approved on or after Nov. 7, 2011, go to lawyers affiliated with a steering committee approved by the federal court to spearhead oil spill litigation for plaintiffs. A statement from the claims facility says the fund needs time to reformulate payments. Fund officials are asking the judge to clarify his order. For now, the claims facility said it would assess the 6% fee against settlements reached after Dec. 29, but asked Barbier whether it should assess the fee for thousands of settlements paid between Nov. 7 and Dec. 29. The claims facility faces the prospect of asking 9,000 people who received a payment between November and the end of December to pay for attorneys' fees. About $260 million has been paid to claimants since Nov. 7, according to the claims facility. Also, the ruling might affect 40,000 settlements under negotiation since Nov. 7, the date when plaintiffs' attorneys first asked the court to establish a fund to cover fees. Read the full story from The Associated Press here.
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