BP 2013 Annual Report Download - page 266

underlying individual complaints raising those claims or otherwise apply
his dismissal of the master complaint to those individual complaints.
In January 2013, the states of Alabama, Mississippi and Florida
submitted or asserted claims to BP under OPA 90 for alleged losses
including economic losses and property damage as a result of the
Incident. BP is evaluating these claims. The states of Louisiana and Texas
have also asserted similar claims. The amounts claimed, certain of which
include punitive damages or other multipliers, are very substantial.
However, BP considers these claims unsubstantiated and the
methodologies used to calculate these claims to be seriously flawed, not
supported by OPA 90, not supported by documentation, and to
substantially overstate the claims. Similar claims have also been
submitted by various local government entities and a foreign
government. These claims under OPA 90 are substantial in aggregate,
and more claims are expected to be submitted. The amounts alleged in
the submissions for state and local government claims total
approximately $35 billion. BP will defend vigorously against these claims
if adjudicated at trial. Certain of these states (including the states of
Alabama, Florida, Texas and Mississippi, as described below) and local
government entities have filed civil lawsuits that pertain to claims
asserted by them under their earlier OPA 90 submissions to BP.
In April 2013, the states of Alabama, Florida, and Mississippi each filed
new actions against BP related to the Incident, which have been
consolidated with MDL 2179. On 19 April 2013, the State of Alabama
filed a new action against BP alleging general maritime law claims of
negligence, gross negligence, and wilful misconduct; claims under OPA
90 seeking damages for removal costs, natural resource damages,
property damage, lost tax and other revenue, and damages for providing
increased public services during or after removal activities; and various
state law claims. The State of Alabama’s complaint also seeks punitive
damages.
On 20 April 2013, the State of Florida filed suit against BP and Halliburton
in federal court in Florida, and its case has also been transferred to MDL
2179. Florida’s complaint alleges general maritime law claims for
negligence and gross negligence; OPA 90 claims for alleged lost tax
revenue and other economic damages; and various state law claims.
Florida also seeks punitive damages.
The State of Mississippi filed both federal court and state court
complaints in Mississippi against BP in April 2013. Mississippi’s federal
court complaint alleges OPA 90 claims against BP, Transocean, and
Anadarko for natural resource damages, property damage, lost tax
revenue, and damages for providing increased public services during or
after removal activities. It asserts general maritime law claims for
negligence and gross negligence against Halliburton only. Mississippi’s
state court complaint alleges various state law claims, including
negligence, gross negligence, and willful misconduct. Both Mississippi
complaints seek punitive damages. The State of Mississippi’s federal
court action and state court action have both been consolidated with
MDL 2179.
On 17 May 2013, the State of Texas filed suit against BP and others in
federal court in Texas. Its complaint asserts claims under OPA 90 for
natural resource damages and lost sales tax and state park revenue;
claims for natural resource damages under the Comprehensive
Environmental Response, Compensation, and Liability Act (CERCLA); and
claims for natural resource damages, cost recovery, civil penalties, and
economic damages under state environmental statutes. The State of
Texas’s action has been consolidated with MDL 2179.
On 14 January 2014, the district court in MDL 2179 set a briefing
schedule, to be completed by 28 March 2014, for BP’s motion to strike
the State of Alabama’s jury trial demand as to its claim for compensatory
damages under OPA 90 which BP then filed on 14 February 2014.
On 5 March 2014, the State of Florida filed a lawsuit to declare various
BP entities (and other entities) liable for removal costs and natural
resource damages.
Agreement for early natural resource restoration
On 21 April 2011, BP announced an agreement with natural resource
trustees for the US and five Gulf Coast states, providing for up to
$1 billion to be spent on early restoration projects to address natural
resource injuries resulting from the Incident. Funding for these projects
will come from the $20-billion trust fund. As of December 2013, BP and
the trustees had reached agreement, or agreement in principle, on a
total of 54 early restoration projects that are expected to cost
approximately $698 million. These include 10 projects that are already in
place or under way, and 44 projects that are subject to a further
regulatory review and public comment process and further trustee
approval before they may proceed.
Other civil complaints
On 26 August 2011, the district court in MDL 2179 granted in part BP’s
motion to dismiss a master complaint raising claims for economic loss by
private plaintiffs, dismissing the plaintiffs’ state law claims and limiting
the types of maritime law claims the plaintiffs may pursue, but also held
that certain classes of claimants may seek punitive damages under
general maritime law. The court did not, however, lift an earlier stay on
the underlying individual complaints raising those claims or otherwise
apply its dismissal of the master complaint to those individual complaints.
On 30 September 2011, the court granted in part BP’s motion to dismiss
a master complaint asserting personal injury claims on behalf of persons
exposed to crude oil or chemical dispersants, dismissing the plaintiffs’
state law claims, claims by seamen for punitive damages, claims for
medical monitoring damages by asymptomatic plaintiffs, claims for
battery and nuisance under maritime law, and claims alleging negligence
per se. As with its other rulings on motions to dismiss master
complaints, the court did not lift an earlier stay on the underlying
individual complaints raising those claims or otherwise apply its dismissal
of the master complaint to those individual complaints.
Citizens groups have also filed either lawsuits or notices of intent to file
lawsuits seeking civil penalties and injunctive relief under the Clean
Water Act and other environmental statutes. On 16 June 2011, the
district court in MDL 2179 granted BP’s motion to dismiss a master
complaint raising claims for injunctive relief under various federal
environmental statutes brought by various citizens groups and others.
The court did not, however, lift an earlier stay on the underlying individual
complaints raising those claims for injunctive relief or otherwise apply its
dismissal of the master complaint to those individual complaints. In
addition, a different set of environmental groups filed a motion to
reconsider dismissal of their Endangered Species Act claims on 14 July
2011. That motion remains pending.
On 31 January 2012, the district court in MDL 2179, on motion by the
Center for Biological Diversity, entered final judgment on the basis of the
16 June 2011 order with respect to two actions brought against BP by
that plaintiff. On 2 February 2012, the Center for Biological Diversity filed
a notice of appeal of both actions to the Fifth Circuit. Following oral
argument, the Fifth Circuit ruled in BP’s favour on 9 January 2013 in
virtually all respects, though it remanded the Center for Biological
Diversity’s claim under the Emergency Planning and Community Right to
Know Act (EPCRA) to the district court. On 22 January 2013, the Center
for Biological Diversity filed a Petition for Panel Rehearing in the Fifth
Circuit, which was denied on 4 February 2013. In January 2014, the
district court in MDL 2179 set a schedule for proceedings on remand of
the EPCRA claim under which limited discovery is under way, after which
the parties may file cross-motions for summary judgment to be fully
briefed by 19 May 2014.
On 11 July 2012, BP filed motions to dismiss several categories of claims
in MDL 2179 that were not covered by the Economic and Property
Damages Settlement. On 1 October 2012, the court granted BP’s
motion, dismissing (1) claims alleging a reduction in the value of real
property caused by the oil spill or other contaminant where the property
was not physically touched by the oil and the property was not sold;
(2) claims by or on behalf of entities marketing BP-branded fuels that they
have suffered damages, including loss of business, income, and profits,
as a result of the loss of value to the ‘BP’ brand or name; and (3) claims
by or on behalf of recreational fishermen, recreational divers, beachgoers,
recreational boaters, and similar claimants, that they have suffered
damages that include loss of enjoyment of life from the inability to use of
the Gulf of Mexico for recreation and amusement purposes. The judge
did not, however, lift an earlier stay on the underlying individual
complaints raising those claims or otherwise apply his dismissal of those
categories of claims to those individual complaints. This order was
appealed to the Fifth Circuit, but the appeal was ultimately dismissed on
14 May 2013 for lack of jurisdiction.
262 BP Annual Report and Form 20-F 2013