NEW ORLEANS (CN) – A federal judge ruled Thursday that BP was grossly negligent in the 2010 Deepwater Horizon oil well blowout that killed 11 and dumped millions of barrels of crude oil into the Gulf of Mexico. The finding by U.S. District Judge Carl J. Barbier exposes the company to up to $18 billion in fines for the worst oil spill in history.
Judge Barbier also held that Transocean, the owner of the rig, and Halliburton, the contractor that cemented the well, were both negligent in the accident.
“[E]ach defendant engaged in conduct that was negligent or worse and a legal cause of the blowout, explosion, and oil spill,” Barbier wrote.
According to the 153-page decision, BP repeatedly ignored warning signs that the well was unstable, and made a series of flawed decisions “primarily driven by a desire to save time and money, rather than ensuring that the well was secure,” Barbier wrote.
In incredible detail, the judge recounts the development of the project and lapses that ranged from poor training of workers to faulty procedural to just plain bad sharing of information about test results and other critical observations.
Acknowledging that there was plenty of blame to go around, Barbier nevertheless placed most of the blame for the disaster on BP, which he said, “had a hand in most of these failures.”
Barbier’s finding of “gross negligence” means he believes BP was guilty of willful misconduct – exposing it to treble damages.
“BP’s conduct was reckless,” the judge wrote. “Transocean’s conduct was negligent. Halliburton’s conduct was negligent.”
His decision apportioned fault at 67 percent for BP, 30 percent for Transocean and 3 percent for Halliburton.
“The Court finds that the conduct of BP’s employees was egregious enough that exemplary or punitive damages would he appropriate,” Barbier wrote. “However, in light of Fifth Circuit precedent, the Court concludes that BP is not liable for punitive damages.”
The judge now must determine how much oil was spilled in the accident to determine the fines the companies will ultimately pay. That trial, the third-phase of a non-jury proceeding, is scheduled for January.
Earlier this week Halliburton reached a $1.1 billion settlement with civil plaintiffs, reportedly settling nearly all of the company’s financial exposure.
In a statement, BP said it “strongly disagrees with the decision” and will immediately appeal it to the 5th U.S. Circuit Court of Appeals.
“The law is clear that proving gross negligence is a very high bar that was not met in this case,” the statement continued. “BP believes that an impartial view of the record does not support the erroneous conclusion reached by the District Court.”
BP agreed to pay a criminal fine of $4.5 billion in December 2012.
Phase two of the trial was held to determine how much oil was spilled Barbier has not issued a ruling on that yet. BP claims 3.3 million barrels of oil leaked; the United States pegs it closer to 5 million barrels.
Barbier will not assess damages until after phase three, which has not even begun yet. It is set to begin in January 2015.
The company has set aside about $42 billion to cover civil damages from thousands of lawsuits.
BP says it has paid $28 billion so far to settle claims stemming from the massive spill.
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