Comments by Overseer of BP Fund Irk Lawyers


For months, lawyers suing BP have fumed as Kenneth R. Feinberg, the administrator of the $20 billion fund to compensate victims of the Gulf Coast oil spill, has encouraged people to seek relief from the fund instead of through the courts.

On Tuesday, they asked a federal judge in New Orleans to order Mr. Feinberg to be more even-handed when he talked to people who considered themselves victims of the spill, and to tell them about the potential rewards of suing the company.

Plaintiffs’ lawyers have been upset by Mr. Feinberg’s comments like those to the New Orleans Times Picayune in September: “Why litigate? Why flood the federal and state courts of Louisiana? You’ll litigate for years. You’ll be paying all sorts of expenses. Who says you’ll win? If I won’t pay you, I urge, no one will pay you.”

In the filing and memorandum submitted to Judge Carl J. Barbier of the Eastern District of Louisiana, who oversees the consolidated federal lawsuits concerning the spill, the plaintiff’s lawyers argued that Mr. Feinberg should be telling potential litigants that, if they go to court, they might be able to win punitive damages, lawyer fees and the opportunity to sue others involved in the spill.

The lawyers asked the judge to ensure that Mr. Feinberg’s public comments, and the language of the paperwork he uses to settle cases, are “clear, accurate and fair” to the people who might be able to sue. They also want Mr. Feinberg and his team to stop advising spill victims that they should not hire a lawyers.

Some of the proposed changes to the release form apply to an earlier draft of the document; the final version has addressed several of the concerns about wording.

The motion, which does not ask Judge Barbier to change or interfere with the claims process, also questions Mr. Feinberg’s independence. It notes that BP is paying his firm $850,000 a month to run the fund, and the lawyers want this fact to be made clear as well — that Mr. Feinberg either be identified as an employee of BP or of the government.

Mr. Feinberg could not be reached for comment. But he has repeatedly said that he is acting independently of BP and the government, and he openly acknowledges that BP is paying for his work — “who better?” he says — saying taxpayers should not be footing the bill.

Mr. Feinberg has urged audiences at community gatherings across the Gulf Coast to seek compensation from the fund rather than going to court, but he has also stated repeatedly that they retain the right to sue until the moment they reach a final settlement with the fund.

It is unclear whether Judge Barbier has any direct jurisdiction over Mr. Feinberg’s actions, but the filings get the lawyers’ complaints about Mr. Feinberg’s statements and their accusations of bias into the court record.

Since the fund was announced in June, the Department of Justice has urged Mr. Feinberg to move faster on claims and to provide more transparency, but the Obama administration has not questioned his independence.

So far, the fund has processed more than 463,000 claims and paid out some $2.5 billion in emergency payments to nearly 170,000 individuals and businesses.

Last month, a second phase of the operation began: negotiating permanent settlements for past and estimated future damages. Those who sign a settlement waive their right to sue BP or any other company involved with the spill.

The second phase has already attracted strong interest, with more than 86,000 requests for final settlements, fund officials said.

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

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