Alabama Goes After Claims Czar Ken Feinberg on Multiple Fronts; Mr. Feinberg Makes New Round of Promises to Improve Claims Process


Alabama continues to turn up the heat on BP claims chief Kenneth Feinberg. On Thursday, the state’s attorney general issued a “consumer alert” – a notice usually warning of ongoing criminal fraud – on the claims facility while both of the state’s U.S. senators met with Mr. Feinberg to address a lack of urgency and a glut of unpaid claims.

Alabama Attorney General Troy King, who remains the only AG to file a lawsuit against BP, noted that Mr. Feinberg is paid an $850,000 monthly fee by BP, and is therefore not a neutral arbiter. “It is unfortunate, but clear to me, that our citizens cannot simply accept Mr. Feinberg’s words and follow his advice, trusting it to be in their best interest. In some cases, it may well not be so,” King said in a news release.

If any part of that one-two punch flustered President Obama’s man in the Gulf, it didn’t show in the reports. He quipped to congressional staffers that “would anybody else” want his job and promised a new task force and personal review of the situation. We can guess that the mayor of Orange Beach, who has heard similar promises before, might be calling his senators right about now.

In the Gulf, this will, of course, be greeting as more political posturing and blather. Nobody is overly impressed anymore with new committees, even if you call them “task forces.” And while the Alabama AG’s “alert” is strong, it remains to be seen if it will be effective. News reports note that Sen. Richard Shelby (R-AL) said he called the meeting with Feinberg to voice the anger, frustration and confusion that coastal residents participating in the claims process are feeling. “We think the payment system has got to change,” Shelby said.

In making his latest round of promises, Mr. Feinberg said his new task force will consist of accountants, who will meet with businesses and review claims to ensure that spill victims are properly compensated. “If they are adequately documented… I will bend over backwards to pay these businesses,” Feinberg said. “The task force will be in Alabama shortly after Thanksgiving.”

What’s lacking, once again, is any transparency. A task force is great, but if the claimants don’t know why their claims were denied or underpaid, it’s just not very effective. From the issue of his compensation – Mr. Feinberg still has not told us that, despite longstanding promises to do so. We only know from press reports what his firm is reportedly paid – and as for details of claims denials, there’s just a wall of secrecy around the entire process.

Until that changes, it’s hard to see where the process changes.

Here is the Press-Register report about Alabama’s revolt:

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Stuart H. Smith is an attorney based in New Orleans fighting major oil companies and other polluters.
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