BP settles another $7.8 bn over Gulf spill on eve of court case

Debris from the May 2010 Deepwater Horizon rig disaster and oil spill

GENEVA, SWITZERLAND – Oil company BP late Friday 2 March reached an out of court settlement with the Plaintiffs’ Steering Committee for the 2010 Gulf oil disaster, the worst in US history, to pay $7.8 billion, mainly to fishermen, small businesses and condo owners near Gulf oil spill in 2010. A court case against the company was scheduled to open Monday but has been delayed as a result of the new deal.

BP says it has already spent about $22 billion: “more than $8.1 billion to individuals, businesses and government entities. In addition, BP has spent approximately $14 billion on operational response.”

The Guardian in the UK reports that “Hundreds of lawyers for all parties were involved in preparing for the trial – and in parallel negotiations to try to get a settlement. There were 340 lawyers from 90 different firms working on the plaintiffs’ side alone. The deal between BP and more than 120,000 victims of the spill – from shrimp boat captains to sales teams at time-share condos, restaurateurs and wedding planners – settles what is arguably the most complicated part of the legal proceedings.”

The court case looks beyond damages to settle blame. The BBC reports that “the trial will probably still go ahead in order to apportion blame for the spill among BP and its fellow defendants. Other companies involved include Transocean, who owned the rig, and Halliburton. All the companies are in dispute with each other over their liability to each other.”

The Houston Chronicle’s business columnist Loren Steffy in a blog today notes that “the complex court proceeding BP faces as early as Monday is unlike anything it – or most other companies – has faced before. The case is bigger than the litigation that followed the Exxon Valdez spill, and it’s more unwieldy in many ways than even the multistate litigation with tobacco companies more than a decade ago.”