The famous New Orleans restaurant Copeland’s is among the latest BP oil spill victims, asking the courts to assume control over the damage claims process.
Like other cases we’re starting to see, including some that my colleagues are involved in, Copeland’s argument focuses on the basic fairness of the claims process being envisioned by Kenneth Feinberg for the $20 billion “Independent Claims Facility.” Like many others in the Gulf, Copeland’s has taken note of Mr. Feinberg’s public statements, especially those to Congress, and have become alarmed by what they’re hearing.
In particular, businesses like Copeland’s that are not “on the beach” worry that the different compensation zones will leave them out of the process. Mr. Feinberg has said that such zones might be part of his payout decisions. If you’re a restaurant owner who built a brand on “fresh local seafood,” you can see where you might feel left out.
But also interesting is the argument that whatever system being created is being created in secret between BP and Mr. Feinberg, and only those they elect to include. Copeland’s and others are calling it a covert process because drafts of the document are not being made public, and any debate is also secret. But we know something in there was alarming enough to bring threats of a lawsuit from the Alabama attorney general…but we still don’t know what’s what.
That’s frustrating to anyone who wanted the court to step in earlier. The court no doubt envisioned some sort of public process, and now faces formal arguments that reflect a growing concern around the Gulf that Mr. Feinberg, who is paid by BP and flying around in a BP plane, is going to be BP’s agent. He has repeatedly asserted his independence from both BP and the government, but as the lawsuits keep coming, that claim is certain to be scrutinized from every angle. We’ll see how Mr. Feinberg’s objectivity and independence hold up. I am not ready to take a position one way or another.
I have yet to meet with Mr. Feinberg, and until I know more, I’m keeping my mouth shut and my powder dry.
See the Copeland’s argument here: Copeland’s Motion 1