BP loses legal battle over 2010 oil spill compensation limits

Oil giant BP has lost out in its bid to limit compensation payouts to those affected by the 2010 Deepwater Horizon disaster, which saw some 5m barrels of oil spill into the Gulf of Mexico from the company’s platform.

The oil firm brought its pleas for help to the US courts after it was ordered by a judge to pay out to claimants.

A court had previously granted an injunction preventing payouts after three judges ruled that compensation payments to businesses affected by the spill should be suspended so that the terms of payment could be better determined.

But the US federal appeals court has now ruled that the terms of an original 2012 settlement between BP and local businesses are to be upheld, and BP’s claims that the court-appointed administrators formula for working out payments is unfair were dismissed.

The ruling was made despite BP asserting that it had the backing of British prime minister David Cameron, who said that a ban on all US federal contracts  by the company would “affect jobs and pensions of workers in the United Kingdom, the United States, and elsewhere”.

There have been several discrepancies between BP and residents in a number of separate cases brought before US courts relating to the incident, including residents accusing BP lawyers of “[misleading] the court”.

BP was also slammed by Judge Carl Barbier, who presided over one of its cases. He said the firm’s “new position [in relation to compensation payouts was] at odds with the settlement agreement’s language and [its] prior statements and submissions”.

Further reading:

BP contests Deepwater Horizon payback scheme amid fears it could run out of money

Judge criticises BP’s attempts to block compensation payouts

US court grants suspension to BP’s Deepwater Horizon payouts

UK government steps in to back BP in US contracts ban

BP lawyers misled the court, Deepwater Horizon claimants say