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US Deepwater Horizon explosion & oil spill lawsuits

Deepwater Horizon Source: US Coast Guard, Creative Commons

In 2010, hundreds of lawsuits were filed against companies involved in the explosion of the offshore drilling rig Deepwater Horizon which killed 11 workers and injured 17. Plaintiffs have a range of concerns, from requesting compensation for their injuries to economic harm resulting from the explosion. Several U.S. government criminal investigations have been launched as well. BP agreed to pay $4.5 billion dollars to the US Deparment of Justice and Securities and Exchange Commission. BP will also pead guilty to 14 criminal charges and will pay an additional $1.26 billion fine to the US Department of Justice. 


On 20 April 2010, the offshore drilling rig Deepwater Horizon exploded and caught fire in US waters of the Gulf of Mexico.  11 workers were killed in the explosion and 17 injured.  The rig was owned by Transocean on lease to BP, which was the main operator and developer of the site, with Anadarko Petroleum and MOEX Offshore (part of Mitsui Oil Exploration) as minority co-owners.  Work on the well had been performed just before the explosion by Halliburton.  The “blowout preventer” was built by Cameron International.  On 22 April, the rig sank.  Oil leaked from the ruptured well head until 15 July when it was temporarily stopped; approximately 4.9 million barrels of oil had leaked into the Gulf.  On 19 September 2010, the US government declared the well “effectively dead”.  Oil directly affected coastal areas in Louisiana, Mississippi, Alabama, Florida and Texas.  People dependent on fishing and tourism have been severely affected, along with those in other industries, including some farther from the Gulf Coast.  Concerns have also been raised in relation to health hazards for clean-up workers and coastal residents, including harms allegedly caused by chemicals used to disperse the oil (made by Nalco).  Coverage of the human rights impacts of the disaster is available here.

The explosion and spill have given rise to many lawsuits.  By early December 2010, hundreds of lawsuits had been filed against the companies involved; this number is likely to increase further.  Lawsuits have been brought in both federal and state courts (for a selection see below).  People claiming to have suffered economic harm from the spill can also seek compensation through the Gulf Coast Claims Facility.  There are two possible claims through the Claims Facility; emergency payments and long-term settlement.  Emergency payments do not prevent the claimants from suing for additional or future losses; however, if a long-term settlement offer is accepted and received, the claimant forgoes the right to sue BP.  More information on the Claims Facility is available here.

Several U.S. Government investigations have been launched into the oil spill including civil and criminal probes conducted by the Justice Department.  The criminal investigation looks into whether improper relations between corporate officials and federal regulators contributed to the accident and breaches of environmental laws.  On 15 December 2010, the US Justice Department filed a civil lawsuit against BP, Transocean, Anadarko, MOEX (part of Mitsui Oil Exploration) and the insurer of the rig QBE Underwriting/Lloyd’s Syndicate 1036 (part of Lloyds of London).  The lawsuit will be included in the consolidated proceedings and includes claims under the Clean Water Act and the Oil Pollution Act.  BP says that it will answer the allegations in a timely manner and will continue to cooperate with government investigations.  BP’s partners in the well, Anadarko and MOEX, as well as Transocean, say BP is to blame for the spill and should be held liable.  On 15 November 2012 BP announced it had reached a $4.5 billion settlement with the US Department of Justice and Securities and Exchange Commission.  BP agreed to plead guilty to 14 criminal charges and to pay a $1.26 billion fine to the Department of Justice.  The company will also pay $2.4 billion to the National Fish and Wildlife Foundation and $350 million to the National Academy of Sciences.  BP will also pay $525 million to the Securities and Exchange Commission.

BP has a general policy not to comment on pending litigation, but information about their response to the explosion and spill is accessible on this part of BP’s website.  The site includes a section on claims and links to BP’s internal investigation of the accident.  On 18 October 2010, BP filed a statement with Court saying they will pay all legitimate claims, regardless of the Oil Pollution Act’s limits on liability.  The filing specifically states that “by making this statement, BP and its affiliates are not admitting anything about their conduct”, and expressly denies gross negligence.  On 13 May 2010, Transocean filed a federal court petition (full text here) seeking to limit its liability arguing it did not cause the disaster and should not be responsible for injuries and damages.  On 24 August 2010, the petition was transferred to the federal Multidistrict Litigation consolidated proceedings until further notice.  According to Bloomberg, Transocean commented in September 2010 that it is awaiting clarity on the “complex litigation landscape” and will then “defend its position vigorously”.  Further information on Transocean’s position is available on a section of its site.  In an October 2010 press release, Halliburton argued that the responsibility for the disaster lies with BP, which failed to perform a key test on the cementing.  In May 2010 testimony to Congress, Cameron’s President and CEO outlined Cameron’s general position.  When contacted by Bloomberg in May 2010, a Cameron spokesperson referred to company policy not to comment on litigation.  In a June 2010 statement, Anadarko claimed that the accident was a “direct result of BP’s reckless decisions and actions”.  On 4 September 2014, the judge in the federal Multidistrict Litigation proceedings issued a ruling finding BP grossly negligent and guilty of wilful misconduct in the Deepwater Horizon disaster.  The judge also found Halliburton and Transocean guilty of negligence.

Below are profiles of a representative selection of lawsuits against companies raising human rights concerns that arise out of the explosion and spill.  This is not a comprehensive listing of lawsuits bringing human rights claims.

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3 May 2016

USA: BP expected to face new wave of lawsuits for damages from Deepwater Horizon oil spill disaster

Author: Amanda Bronstad, National Law Journal (USA)

"A Flood of Oil Spill Lawsuits Expected Against BP this Month", 2 May 2016

Despite the $20 billion settlement BP PLC struck with the U.S. Department of Justice over the 2010 Deepwater Horizon oil spill, tens of thousands of lawsuits could hit the courts this month, adding to the oil company's ballooning costs. About 85,000 individuals and businesses claiming nongovernmental economic damages tied to the spill are due to file lawsuits against BP by May 16. Their claims are separate from the $20 billion deal; most were either excluded from or opted out of a 2012 class action settlement that was supposed to resolve economic damages claims...U.S. District Judge Carl Barbier last month signed off on BP’s $20 billion deal...[I]n March... Barbier issued a pretrial order that requires individuals and businesses to file certain documents with the court or face dismissal of their claims...Barbier... set a deadline for May 2...More than 100 law firms filed motions to extend the deadline...Barbier granted the firms a 14-day extension...


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15 December 2015

USA: Manslaughter charges dropped against BP employees in Deepwater Horizon oil spill case

Author: Janet McConnaughey & Michael Kunzelman, Huffington Post (USA)

"Manslaughter Charges Dropped In BP Oil Spill Case", 2 Dec 2015

…Prosecutors dropped manslaughter charges against two BP supervisors responsible for safety aboard the oil rig where an explosion killed 11 workers in 2010.  One of them then pleaded guilty Wednesday to the only remaining charge: a misdemeanor count of violating the federal Clean Water Act…[T]estimony during civil cases was among factors that convinced prosecutors that the involuntary manslaughter charges could not legally stand up…Prosecutors' court filing said dismissing the 11 manslaughter each man faced was "in the interests of justice."…This summer, the global energy giant agreed to a record settlement of nearly $20 billion to states affected by the spill in hopes of bringing an end to a legal drama…But the settlement did not affect ongoing criminal cases…Prosecutors said Vidrine and Kaluza botched a key safety test…"As a result of this court proceeding today, no man will ever spend a moment behind bars for killing 11 men for reasons based entirely on greed," [said Keith Jones, whose son Gordon Jones died in the rig explosion].

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18 November 2015

USA: Clean-up worker sues BP over alleged exposure to toxic & hazardous compounds following Deepwater Horizon oil disaster

Author: Gene Johnson, Louisiana Record (USA)

"Oil Spill Cleanup Worker sues BP America for alleged exposure to toxic and hazardous compounds", 16 Nov 2015

A vessel captain that performed various cleanup operations from the BP oil spill claims the British petroleum company negligently exposed him to hazardous and cancer-causing compounds. Josip Piacun filed a lawsuit against BP Exploration & Production Inc. and B.P. America Production Co. on July 27 in the U.S. District Court, Eastern District Louisiana citing gross negligence under the general maritime law…The complaint states that Piacun has "developed psychological, dermal, respiratory and cardiopulmonary complications as a result of the exposure." Piacun claims that BP failed to utilize reasonably safe dispersing chemicals in its allegedly haphazard attempts to respond to the oil [spill]…

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5 November 2015

USA: Court dismisses oil spill compensation case against Transocean following settlement

Author: Associated Press

“Suits dismissed after Gulf states settle with Transocean over damages from 2010 Gulf oil spill”, 28 Oct 2015

A settlement has led to official dismissal of federal lawsuits filed by the five Gulf of Mexico states against the owner of the offshore drilling rig involved in BP's 2010 Gulf of Mexico oil spill.  U.S. District Judge Carl Barbier…dismissed the suits Thursday against Transocean.  Alabama, Florida, Mississippi, Louisiana and Texas joined Transocean in requesting the dismissal recently…The Transocean settlements are far less than settlements announced earlier this year between rig operator BP and the states…

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12 October 2015

USA: Indian tribe sues BP, Transocean & Halliburton over loss of resources & lands due to Deepwater Horizon oil spill

Author: Maki Somosot, Houma Today (USA)

"Indian tribe suing companies for oil spill damages", 10 Oct 2015

The Pointe-au-Chien Indian tribe is suing BP, Transocean and Halliburton for damages in connection with the severe loss of tribal lands and resources stemming from the Deepwater Horizon oil spill in 2010…"The spilled oil directly impacted vast portions of the Gulf of Mexico coastline, including (the tribe's) aboriginal lands," tribal chiefs Charles Verdin and Donald Dardar alleged in the lawsuit. "These are lands historically occupied by tribal members and ancestors, and include tribal cemeteries, sacred sites, Indian mounds, archaeological sites, village sites, shell middens and traditional fisheries."[T]he tribe…opted to not accept the compensation offered by BP, as it was insufficient to cover its out-of-pocket costs and amounted to less than $75,000…"Throughout the course of the spill, (tribal) members were unable to fish as a result of government spill-related closures of its fishing grounds," the suit says. "After fisheries reopened, the resources were less available and subject to greater pressure, causing a decrease in the amount of natural resources available for subsistence use."…Compensatory damages are also sought for loss of use of subsistence and natural resources…


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6 October 2015

U.S. Settles Claims Against BP Over Deepwater Horizon Spill For $20 Billion

Author: Bill Chappell, NPR (USA)

Federal and state claims against BP for the April 2010 Deepwater Horizon oil spill have been resolved, the Justice Department says, with the oil and gas company agreeing to pay more than $20 billion in penalties. Calling it "a historic resolution," U.S. Attorney General Loretta E. Lynch said Monday that the deal is "the largest settlement with a single entity in American history," with a record environmental penalty…According to BP, the settlement announced today "does not reflect a new settlement or any new money." Instead, the company says, the figure touted by U.S. officials today includes money that was previously spent or announced…With today's announcement, the government is opening two months of public comment on the settlement. It'll then go before a federal judge for final approval.

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5 October 2015

7 things we know about the finalized BP oil spill settlement

Author: Jennifer Larino, NOLA.com (USA)

U.S. Attorney General Loretta Lynch and other federal officials gathered Monday morning (Oct. 5) to file the details of the $20 billion settlement agreement with BP over the 2010 Gulf of Mexico oil spill in federal court. The 90-page settlement resolves federal and state claims as well as claims over natural resource damage caused by the disaster. Louisiana is set to receive more than $6.8 billion from the agreement the U.S. Justice Department and five Gulf Coast states reached with BP in July. The deal ends years of complex litigation and allows payments to start flowing to clean and restore the coast, compensate for lost local tax revenue and meet other needs.

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5 October 2015

Deepwater Horizon: BP got 'punishment it deserved' Loretta Lynch says

Author: Dominic Rushe, Guardian (UK)

BP got “the punishment it deserves”, the US attorney general, Loretta Lynch, said on Monday as she announced a record settlement of more than $20bn arising from the oil firm’s fatal 2010 Deepwater Horizon oil spill. The deal, also agreed with the five states most affected by the spill, ends five years of legal fights over the disaster, which claimed 11 lives and pumped nearly 134m gallons of oil into the Gulf of Mexico over 87 days…“The steep penalty should inspire BP and its peers to take every measure necessary to ensure that nothing like this can ever happen again.” [said Lynch]…The spill “inflicted unprecedented damage”, said Lynch. “Ecosystems were disrupted. Businesses were shuttered. Countless men and women lost their livelihoods and their sense of security.”…Lynch said that the settlement was “not designed to discourage any valid economic activity in the Gulf”. “What it is designed to do, however, is not only to compensate for damages to provide a way forward for the health and safety of the Gulf, but let other companies know they are going to be responsible for the harm that occurs should accidents like this happen in the future…

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26 May 2015

USA: Transocean, Halliburton & BP each reach settlements in Deepwater Horizon oil spill lawsuits

Author: Miriam Rozen, Texas Lawyer (USA)

"Transocean, Halliburton & BP: Settlement Frenzy", 21 May 2015

BP, Halliburton Co. and Transocean Ltd. each reached settlements this week in the litigation stemming from the 2010 Gulf of Mexico oil spill. Transocean reached on May 20 a $211 million settlement with businesses and individuals claiming damages from the spill...Transocean also settled with BP in a separate agreement, which requires no court approval. BP will pay Transocean $125 million in compensation for legal fees; BP will discontinue attempts to recover any additional insurance under Transocean's liability policies; and Transocean will allow BP accelerated recovery of about $538 million in insurance proceeds… Halliburton also settled with BP this week. In its May 20 announcement of the deal, Halliburton did not disclose the terms, which also do not require court approval.

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11 May 2015

USA: Judge grants BP right to appeal damage claims over Deepwater Horizon oil spill

Author: Reuters


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