As Claims for Spill Losses Shift to Administrator, Queries Follow


BAY ST. LOUIS, Miss. — “The day is here,” Kenneth R. Feinberg announced on Monday at the American Legion Post 139 Bingo Hall, just over a mile from this town’s quiet gulf beaches. “If you’ve got a claim from BP, those days are over,” he continued. “BP’s out of the business.”

“The day” was when Mr. Feinberg officially took control as administrator of the $20 billion fund set up by BP to pay out claims to those whose lives or businesses have been hurt by the BP oil spill. For the occasion, he traveled along the Mississippi coast, laying out his plans, answering questions and encouraging people to file claims immediately.

Details of his plan have been made public over the past few days, but there was no shortage of questions from the skeptical crowd at the bingo hall, a mix of shrimpers, lawyers, real estate developers, restaurateurs and politicians, in flip-flops, flats and oxford shoes.

Keath Ladner, owner of Gulf Shores Sea Products, said he had been communicating with scientists around the country and had serious concerns that the August 2013 deadline for final settlement claims might fall before the true extent of the damage was known. Even if the shrimp, crab and oysters are found to be safe, it is impossible to say how long seafood buyers will be suspicious of gulf seafood. For now, Mr. Ladner said, they certainly are not buying.

“This is one of the most difficult questions we’ve got,” Mr. Feinberg said, before going on to list several options for Mr. Ladner, including opting out of the process and suing.

One woman, a lawyer and politician, asked if there was a cap on emergency claims. (No.) Another man asked if the fund would pay for relocation costs if someone decided to leave the gulf because of the spill. (No.) One woman was curious about Mr. Feinberg himself.

“If you’re not with BP and you’re not with the government, who are you with?” she asked.

“My decisions are strictly my own,” said Mr. Feinberg, a Washington lawyer who also handled the Sept. 11 victims’ compensation fund.

The issue of proximity to the gulf, one of the more controversial qualifications for receiving a claim, did not arise in this beach town. But there were several pointed questions about Mr. Feinberg’s policy on real estate reimbursement, and the askers came away dissatisfied. Under the terms of the fund, people can be compensated if they sold property and could prove that they received much less for it than they would have if the spill had not occurred. And they could be compensated for loss of rental income.

But a mere drop in property value, Mr. Feinberg said unequivocally, would not be compensated.

“Is he encouraging everybody on the Gulf Coast to dump their property?” asked Mr. Ladner’s brother, Kirk, who had been trying to sell beachfront property to developers before the spill. One group of developers walked away from about 13 acres and now, he said, no one wants to buy the property and he has no recourse in the claims process.

What was most frustrating about that, said Mr. Lander’s partner in the land deal, Russell Elliott, was that BP had seemed open to some sort of claim on lost property value.

“Now he comes and throws it in the garbage,” Mr. Elliott said. “He’s made a Catch-22. You can’t sell it, but you can’t collect until you sell.”

While those who have already filed claims did not have to provide new documentation of their losses — BP was handing over the paperwork — they did have to refile their claims. Mr. Feinberg said that as of 9 a.m. more than 500 claims had been filed.

Beverly and Frank Fontenot, owners of Benigno’s seafood restaurant, fueled themselves with coffee and stayed up until midnight to call the new claims hot line as soon as it opened for business. The person on the other end could not find their claim, but the Fontenots were still more confident about the new process 10 hours later.

Dealing with BP, Mr. Fontenot said, had been a nightmare. He says he could account for at least $60,000 in lost revenue over the summer, and he has only a $5,000 check from BP to show for it.

Ms. Fontenot said she was cautiously optimistic about Mr. Feinberg.

“I believe that this man with his experience has got to have some logic, some reason behind his thinking,” she said.

They filed a claim on Monday and were told they would receive the money within seven days.

“Now,” she said, “we’ll have to see how impressive he really is.”

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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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