BP Faces $18 Billion Fine For "Gross Negligence" In Gulf Of Mexico Spill

U.S. District Judge Carl Barbier in New Orleans ruled today that BP was "grossly negligent" in the 2010 Deepwater Horizon rig explosion and may face up to $18 billion in civil penalties, according to The WSJ. In addition, Transocean and Halliburton were found 'negligent' - a lessor offense - (fines up to $1,100 per barrel for 'negligence', $4,300 for 'gross negligence'). This result comes 2 years after BP agreed to accept criminal responsibility for the disaster and to pay $4.5 billion in fines and restitution. BP quickly issued a statement that it will appeal the decision and believes the findings "are not supported by evidence at trial."

 

As Bloomberg reports,

In a turning point after four years of legal wrangling over responsibility, U.S. District Judge Carl Barbier’s ruling laid the bulk of the blame on BP for the explosion, which killed 11 men and caused the largest offshore oil spill in U.S. history.

 

BP, which has spent more than $28 billion on the accident so far, is exposed to as much as $18 billion in additional government fines and penalties.

 

The judge found co-defendants Transocean Ltd. and Halliburton Co. less responsible for the spill.

 

“BP’s conduct was reckless,” Barbier wrote in a decision today in New Orleans federal court. “Transocean’s conduct was negligent. Halliburton’s conduct was negligent.”

The costs:

  • *BP: STATUTORY SIMPLE NEGLIGENCE MAX. PENALTY $1,100 PER BARREL
  • *BP: STATUTORY GROSS NEGLIGENCE MAX. PENALTY $4,300 PER BARREL
  • *BP SAYS COURT HAS NOT YET RULED ON NUMBER OF BARRELS SPILLE

BP's statement includes:

  • *BP DISAGREES W/ DECISION ISSUED TODAY
  • *BP REVIEWING DECISION
  • *BP WILL ISSUE A FURTHER STATEMENT `AS SOON AS POSSIBLE'
  • *BP BELIEVES FINDING IS NOT `SUPPORTED BY EVIDENCE AT TRIAL'
  • *BP TO APPEAL IN U.S. COURT

Statement on Gulf of Mexico

BP strongly disagrees with the decision issued today by the United States District Court for the Eastern District of Louisiana and will immediately appeal to the United States Court of Appeals for the Fifth Circuit.

 

BP believes that the finding that it was grossly negligent with respect to the accident and that its activities at the Macondo well amounted to willful misconduct is not supported by the evidence at trial. The law is clear that proving gross negligence is a very high bar that was not met in this case. BP believes that an impartial view of the record does not support the erroneous conclusion reached by the District Court.

 

The Court has not yet ruled on the number of barrels spilled and no penalty has yet been determined. The District Court will hold additional proceedings, which are currently scheduled to begin in January 2015, to consider the application of statutory penalty factors in assessing a per-barrel Clean Water Act penalty. The Clean Water Act requires the District Court to consider a number of factors in determining an appropriate penalty. The statutory maximum penalty is $1,100 per barrel where the court finds simple negligence and $4,300 per barrel where the court finds gross negligence or willful misconduct. During the penalty proceedings, BP will seek to show that its conduct merits a penalty that is less than the applicable maximum after application of the statutory factors.

 

BP is reviewing the decision and will issue a further statement as soon as possible.

*  *  *

And it appears January 2015

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