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COURT FINDS BP SPILLED 3.2 MILLION BARRELS OF OIL INTO THE GULF

On January 15, 2015, a federal court reached a decision in the BP Oil Spill case assessing the amount of oil that was spilled into the Gulf of Mexico. Judge Carl J. Barbier of the Federal District Court in New Orleans issued a ruling finding that BP 3.19 million barrels of oil were spilled following the April 20, 2010 oil rig fire and explosion that killed 11 people and spewed oil into the Gulf of Mexico for 87 consecutive days.

The amount of oil that Judge Barbier found to have been spilled was considerably less than what the United States government alleged. The government's experts argued that approximately 4.2 million barrels spilled into the gulf after BP's collection efforts were taken into account. The United States' estimate would have resulted in a maximum penalty of $18 billion against BP, since the company was found grossly negligent under an earlier ruling, and, accordingly, the maximum penalty under the Clean Water Act of $4,300 per barrel could be issued.

However, BP's experts argued that only 2.45 million barrels were spilled into the Gulf, after collection efforts were considered. Judge Barbier, in a sense, "split the difference" between the two opposing sides. Indeed, there is very little discussion in the decision how Judge Barbier arrived at the 3.19 million barrel figure. Instead, he wrote that the evidence provided by the government and BP was "voluminous, dense, highly technical, and conflicting...Both sides presented evidence to support their cumulative flow estimates, and each mounted effective attacks on the other's calculations."

Professor Edward F. Sherman, of Tulane University, agreed with Judge Barbier's approach. He said, "At times we claim precision, but there's no way to precisely find the numbers, so why not pick a number as he did, reasonably between the two numbers provided by the parties."

Ultimately, Judge Barbier found that 4 million barrels were spilled, and BP's collection efforts resulted in 810,000 being captured at the wellhead by siphoning device. Thus, he subtracted the collected oil from the total amount and reached 3.19 million barrels.

Under Judge Barbier's ruling, BP may be held liable for as much as $13.7 billion in Clean Water Act penalties. However, some experts believe that this penalty will be lower than the maximum amount. A former federal prosecutor of environmental crimes, David M. Uhlmann of the University of Michigan Law School estimated that the final penalty will be approximately $10 billion. Fadel Gheit, an analyst at Oppenheimer & Co. estimated that the fine would be no more than $9.2 billion and could be as low as $3.5 billion. Mr. Gheit added that he hoped the judge would take into consideration that, in his belief, BP "went beyond what any other company would do" to mitigate the harms.

The decision came after Phase Two of the trial, which was conducted from September 30, 2013 through October 18, 2013. The first phase of the trial was held between February 25, 2013 and April 17, 2013 and resulted in a decision on September 4, 2014. The earlier decision held that BP was grossly negligent, and could be liable for the maximum penalties under the Clean Water Act. The decision also apportioned the fault of the spill; holding BP 67% liable, Transocean 30% liable, and Haliburton 3% liable.

A third phase of the trial is scheduled to begin on January 20, 2015. The last phase will set the fine that BP will be ordered to pay. Judge Barbier will be considering certain criteria in setting the fine including the seriousness of the violation, the degree of culpability, any history of prior violations, other penalties for the same incident, whether minimization or mitigation efforts were taken, and the economic impact of the penalty on the company.

If you, or someone you know, was injured or harmed by the BP oil spill or any other environmental disaster, contact Louis Grandelli, P.C.

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