Complex Gulf oil spill settlement pushes legal frontier

Published Oct 1, 2012 at 10:00 am (Updated Oct 1, 2012)

The proposed settlement of health and economic damage claims arising from the 2010 Gulf of Mexico oil spill breaks new legal ground and raises questions about whether its class-action structure is too rigid for the wide range of circumstances it covers. “There is a tension between the seeming inflexibility of these class action settlement rules and the need for them to be applied to individual businesses on a case-by-case basis within industries,” Chris Dean, a Houston-based lawyer with several spill clients, tells The Houston Chronicle. BP and a steering committee representing plaintiffs negotiated the proposed settlement to resolve economic and medical claims for Gulf Coast residents and businesses affected by the massive oil spill after the deadly blowout of BP’s Macondo well in April 2010. The British oil company estimates it will pay out $7.8 billion in the settlement, although the agreement doesn’t set a cap for damages. Some plaintiff attorneys have argued that the formulaic approach makes it inherently unequal for some plaintiffs, such as applying the same risk multiplier in a given geographic area to compensate for future losses. “You can’t put everyone in the same pot and treat them the same,” says Brent Coon, a Houston-based attorney for several thousand clients. “They all lost different amounts of money.” The full story is available here.