Supreme Court rejects BP’s request to freeze oil spill claims, payments resume

BP 435x292 Supreme Court rejects BP’s request to freeze oil spill claims, payments resumeThe U.S. Supreme Court on Monday rejected BP’s request to freeze payments to businesses harmed by its Deepwater Horizon oil spill as the oil giant waits to hear whether the high court will hear its appeal of the settlement agreement it reached with plaintiffs’ lawyers in 2012.

In its fight to kill the uncapped oil-spill settlement agreement it helped design and then approved in 2012, BP has pushed its argument all the way to the Supreme Court. The company says oil spill fund administrator Patrick Juneau misinterpreted the agreement terms and is paying fictitious and inflated claims to businesses. However, under the terms of the settlement, which was designed to expedite claims given the sheer number of claimants, businesses do not have to prove direct harm.

The Supreme Court did not issue a comment in its refusal to stop payments on claims, but its decision likely means most outstanding claims will be paid by the time the court decides whether to take up BP’s appeal.

Loyola University law professor Blaine LeCesne told the New Orleans Times-Picayune the Supreme Court’s decision is “a very strong sign that the Supreme Court will not hear BP’s appeal, and if it does, that BP will not prevail on the merits” of its case, adding that the ruling is “likely a penultimate ending of BP’s quest to throw out the settlement.”

Plaintiffs’ lawyers and other critics say the oil giant has been trying to scuttle the agreement ever since it became clear that claims payments would exceed its estimate of $7.8 billion. Under the terms, BP now expects to pay at least $9.2 billion to settle remaining claims.

Mr. Juneau’s office resumed processing business claims this month after being put under a temporary hold since October.