Panel to Decide Fate of Hundreds of Oil Spill Suits

HOUSTON (CN) – Well sealed. Spill gone. Litigation? No end in sight. Nearly a decade after BP’s Deepwater Horizon oil spill fouled the Gulf of Mexico, the company asked a Fifth Circuit panel Thursday to dismiss claims of hundreds of litigants for noncompliance with a pretrial order.

A worker removes oil that washed ashore from the Deepwater Horizon spill on June 9, 2010 in Belle Terre, La.. (AP Photo/Eric Gay)

BP’s oil spill was monstrous. The federal government estimates 4.9 million barrels spewed from the London-based multinational’s well 41 miles off the coast of Louisiana in the spring of 2010 before the well was capped, the largest marine oil spill in U.S. history.

The litigation in its wake is also a monstrosity. Though BP has paid more than $20 billion in settlements to hundreds of thousands of claimants, the docket is far from closed as hundreds of single-plaintiff lawsuits have been stayed with no trial date set.

U.S. District Judge Carl Barbier is managing the litigation in New Orleans. To whittle down the caseload, Barbier issued pretrial order 63 in February 2017. 

PTO 63 pertains to all claims for oil spill cleanup work, and claims for personal injury and medical monitoring due to exposure to the oil that was still washing up daily on beaches in Alabama and the Florida panhandle in 2013.

The order barred remaining litigants from bringing class actions and required them to file individual lawsuits with one plaintiff by April 12, 2017.

Attorneys representing 817 people whose cases Barbier dismissed with prejudice for noncompliance with his order asked a Fifth Circuit panel at the Houston federal courthouse Thursday to revive their claims.

The wood-paneled courtroom and three judges sitting in black robes on the bench hearing esoteric legal arguments insulated the 30 onlookers in the gallery from memories of April 20, 2010 when BP’s well blew out, causing an explosion that killed 11 people.

The ensuing spill covered seabirds in oil and, when combined with the chemicals used to disburse the oil slick, contaminated fish, shrimp and crabs, damaging their reproductive systems so they gave birth to mutated offspring – fish with scales marred by oozing sores, and shrimp with no eyes.

William Gibbens told the panel that his 17 clients, who claim they were exposed to hazardous chemicals responding to the spill, made an honest mistake in failing to comply with Barbier’s pretrial order.

U.S. Circuit Judge Jennifer Elrod asked Gibbens why they had trouble with the order when another 960 plaintiffs complied with it.

“It was a misreading of the order,” Gibbens said. “We thought by filing lawsuits that were not class actions, that we were okay.”

He said he did not know that by individual lawsuits, Barbier meant one plaintiff per lawsuit.

Gibbens said his clients followed the advice of the Plaintiffs Steering Committee, a group of 15 lawyers Barbier appointed to help manage the litigation, and filed sworn statements in which they laid out their claims before the deadline, but did not file individual lawsuits.

Heather Lindsay represents 800 people who say they were hired by BP contractors Plant Performance Services LLC and Fluor Corporation Inc. to help clean up oil that washed onto Florida beaches.

They claimed in two lawsuits in the Northern District of Florida that they were wrongly terminated from the cleanup jobs in September 2010 after they were exposed to toxic chemicals. The cases were transferred to Barbier’s docket.

Lindsay told the panel that Barbier did not permit her clients discovery needed to find out if they even have valid breach of contract claims against BP.

She said she filed a motion for relief from Barbier’s pretrial order in April 2017 stating that it would cost her clients more than $300,000 in filing fees to bring individual lawsuits, and asking if they could have their filing fees waived.

Barbier gave them a break. He extended the filing cutoff date by three weeks. But they did not file individual complaints, leading Barbier to dismiss their claims with prejudice in July 2017.

Judge Elrod, a George W. Bush appointee, asked Lindsay why she did not heed Barbier’s warning her clients’ claims would be barred.

“I only got one warning,” Lindsay said. “I asked that plaintiffs could fire me and proceed in forma pauperis [with no payment of filing fees]. This ruling punishes indigent people. It does not prejudice BP.”

BP’s attorney George Hicks disagreed. He works for the Washington, D.C firm Kirkland and Ellis.

He said Barbier acted within his discretion in dismissing the lawsuits with prejudice because PTO 63 came three months after a similar pretrial order that pared down the litigation, so all claimants subject to PTO 63 were aware of how the process worked.

“Don’t the rules require notice before the ultimate sanction of dismissal with prejudice?” Elrod said.

Hicks said Barbier gave four different warnings about the filing deadline in the order.

“Judge Barbier is trying to keep the trains running on time,” Hicks said.

He said it took Barbier a year to figure out which single-plaintiff lawsuits filed under PTO 63 were legitimate and not fraudulent, and it would “gum up the works” if the Fifth Circuit reinstated the claims of the 800-plus litigants involved in the appeal.

In closing arguments, U.S. Circuit Judge Kyle Duncan, a Donald Trump appointee, asked Gibbens why the ship has not sailed on his 17 clients’ claims given that Barbier has moved on to another pretrial order that requires PTO 63 litigants to “provide more particularized information regarding their claims.”

Gibbens did not hesitate.

“The individual complaints have been stayed for eight years. They’re still stayed and no trial date’s been set,” he said. “This is only 17 cases. So adding them to hundreds of cases would not be hard.”

For Lindsay’s 800 clients, she asked the panel to revive their cases and send them back to the Northern District of Florida, so they can pursue breach of contract claims against BP’s oil spill cleanup contractors.

Another Trump appointee, U.S. Circuit Judge Don Willett filled out the panel.

The judges took the arguments under submission and did not say when they would rule.

Despite the drawn-out litigation, BP has largely recovered from the oil spill. It sold $60 billion in assets to cover liabilities from the disaster and its shares were trading at $42.54 Thursday afternoon, up from a low point of $29.35 in the months after its well ruptured.

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