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Trial Court in BP OIL Spill to Set Guidelines

PENSACOLA, FL, OCT. 22, 2013 - In light of the 5th Circuit Court of Appeal’s ruling on the issue of whether a BP Oil Spill business claimant's expenses need to be “matched” to revenues under the Economic Loss Settlement Agreement, the trial court in New Orleans must decide how the ruling will be implemented in practice.  On October 18, Judge Barbier issued an injunction indicating that some claims might be affected by the 5th Circuit ruling, while other claims may not be.  The Court's order directs that claims based on “properly matched accrual basis records” should continue to be processed, as well as any other claim where the Administrator determines matching of expenses to revenues is not an issue.

Of course, this means that there is still a lot to be done by the Administrator, both on the individual business claims and in the development of consistent guidelines for the handling of claims going forward. Judge Barbier directed the Administrator to develop policies to identify which claims will be processed and paid.  Those policies are expected to be issued on October 25.  Once those policies are enunciated, claimants and their attorneys will have a better idea of which claims will be processed and the criteria that will be utilized in evaluating the claims.

For the claims that are put on hold, the Court has scheduled a hearing on December 2 to decide if “matching” is required under the settlement agreement, and if so how “matching” should be accomplished.  If “matching” is required, it is anticipated that a change to the settlement formula may affect the allowable claim amount of some claims.   At present, attorneys for the business claimants have no specific information on the type of changes that might occur, or how they will affect a given claim.  These issues should become clearer after the Court makes its ruling sometime after the Dec. 2 hearing. According to Pensacola attorney Mark Proctor, whose law firm represents numerous businesses in the claims process, "We are doing everything we can to overcome these unfortunate delays, but we still need a good deal of direction and clarification from the Court and the Settlement Administrator. We are confident that everyone involved will want to see that claims and payments get back to being processed as soon as possible, as the settlement agreement intended."

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