Dispute Brewing Over BP Oil Spill Claims

Posted in Alabama Maritime News,Florida Maritime News,Government,Louisiana Maritime News,Maritime Law,Mississippi Maritime News on April 13, 2011

JACKSON, MS – The Mississippi Attorney General, Jim Hood has asked a District Judge to intervene on behalf of claimants in the $20 billion BP Oil Spill fund causing some friction with the fund administrator, Kenneth Feinberg.

BP Oil Spill fund administrator, Kenneth Feinberg

In New Orleans, U.S. District Judge, Carl Barbier has been asked by attorneys general from four states (Florida, Alabama, Louisiana and Mississippi) to monitor the administration of the BP Oil Spill fund.

Following an analysis of recent claims payment data, Hood accused fund administrator, Kenneth Feinberg of using “economic duress” on claimants to get inadequate, quick settlements. Hood said that he had conducted a series of town hall meetings and determined that there was a “failure of the claims process to timely and fully compensate claimants.”

Bloomberg News reports:

Hood claimed Feinberg’s fund has paid “barely 3 percent of interim business claims and 9 percent of individual interim claims’’ for economic damages resulting from the worst offshore oil spill in U.S. history. He said the claims facility imposed “unreasonable’’ documentation requirements and then used claimants’ inability to provide the records as grounds for denying legitimate claims.

Feinberg denied Hood’s accusations plus defended a pay raise he received in January for administering the claims facility. Feinberg said he rejected 44,000 interim claims on the basis that the claims lacked the necessary proof of eligibility for damages that could be attributed to the spill.

In a court filing on April 7, U.S. District Judge Carl Barbier was asked by Hood to intervene in the matter and to conduct an independent audit of the Gulf Coast Claims Facility and to hold public hearings on the findings.

In court papers filed in response, Feinberg’s lawyer, David Pitofsky, said that under the Oil Pollution Act, the court did not have the power to impose the monitoring of the Gulf Coast Claims Facility that was sought by Hood.