NEW ORLEANS (CN) - Some oil spill claimants say class certification of more than 130,000 plaintiffs would aid the "unscrupulous" tactics used by Kenneth Feinberg and BP's Gulf Coast Claims Facility.
The two named plaintiffs in the memo opposing class certification say there are too many different circumstances involved in the litigation for class certification to be granted. They also say the entire process has been set up to choke off legitimate claims, for the benefit of BP and the expediency of Feinberg's GCCF.
According to the 22-page motion filed last week by Tampa attorney Brian Donovan: "Defendants Feinberg, et al. have been strategically and systematically forcing oil spill claimants to accept quick payments with accompanying releases because they are offered no other viable option. Feinberg, et al. have established a claims process with the primary function of convincing claimants that the only compensation available is a minimal set amount that comes with a full release attached."
The memo claims that Feinberg and the GCCF "misled plaintiffs by employing a 'Delay, Deny, Defend' strategy against them. This strategy, commonly used by unscrupulous insurance companies, is as follows: 'Delay payment, starve claimant, and then offer the economically and emotionally stressed claimant a miniscule percent of all damages to which the claimant is entitled. If the financially ruined claimant rejects the settlement offer, he or she may sue.'"
The opposition to class certification was filed on behalf of plaintiffs Pinellas Marine Salvage Inc. and John Mavrogiannis.
It states: "Here, the class certification would be in a mass tort context within the context of a multidistrict litigation. Given that 'all individual petitions or complaints that fall within Pleading Bundles B1, B3, D1, or D2, whether pre-existing or filed hereafter, are stayed until further order of the court' (Pretrial Order No. 25, Para. 8), certification of pending class actions would most probably not be decided until the conclusion of the limitation and liability trial which does not commence until February, 2012. 'It was reported that one attorney has approximately 23,000 claimants and inquiry was made as to whether the attorney may produce the information in the form in which it is maintained rather than complete individual PPFs.' (Rec. Doc. 642 at Page 2) As of November 16, 2011, there are 523 actions, which encompass approximately 130,000 total individual claims, pending in MDL [multidistrict litigation] 2179. In other words, tens of thousands of potential class members are in legal limbo. This hardly 'creates insurmountable pressure on defendants to settle.'
"In the context of one of the largest mass tort cases in United States history, the damages suffered by the vast majority of individual potential plaintiffs as a result of the BP oil spill of April, 2010, and the subsequent 'Delay, Deny, Defend' strategy of Feinberg, et al., are potentially so great that class treatment would not be necessary to permit effective litigation of the claims. Here, when the amount of damages suffered by the individual is so great, the filing of an individual lawsuit should be economically feasible and would be in the best interests of the plaintiffs.
"The associated cost, consumption of time, and ongoing negative publicity of numerous trials, rather than a few class action lawsuits, are required in order [to] exert the proper amount of pressure on parties to negotiate a settlement which reflects the true value of the claim and not one which focuses on minimizing the liability of Feinberg Rozen, LLP, Feinberg/GCCF, and the responsible parties." (Parentheses, but not brackets, in original.)
The document adds: "Plaintiffs continue to suffer damages from three separate sources: (a) once from the oil spill, the environmental and economic damages of which have devastated their way of life; (b) again by being left in financial ruin as a direct result of defendants' 'Delay, Deny, Defend' strategy; and (c) a third time for daring to demand justice, which will consume their time, energy and hopes for years to come if they are held hostage by protracted litigation.
"If motions for class certification pursuant to Federal Rule of Civil Procedure 23 are granted in MDL 2179, defendants Feinberg, et al. will continue to have no incentive to settle claims, including plaintiffs' claim, and plaintiffs will never receive the true value of their claim."
The April 20, 2010 explosion of the Deepwater Horizon oil killed 11 people and set off the worst oil spill in U.S. history. As the "responsible party" for the oil spill under the Oil Pollution Act of 1990, BP initially received and paid spill-related interim claims directly.
Feinberg was chosen by the White House and BP to handle economic damage claims, and the GCCF was established, under his oversight.
The "Plaintiffs' Memorandum in Support of Their Motion in Opposition to Class Certification on any Action in MDL No. 2179" states that the original complaint from the motion arises from was one of only two cases of its kind.
It was originally filed in Pinellas County, Fla., but was removed by the defendants to the Middle District of Florida (FLMD) Federal Court "on the erroneous grounds that the FLMD has federal question jurisdiction under 28 U.S.C. § 1332. ... On August 9, 2011, the MDL [multidistrict litigation] Panel ordered this action transferred to MDL No. 2179 on the erroneous grounds that '[T]his action, similar to other actions already in the MDL, arises from alleged injury to plaintiffs' business resulting from the oil spill." (Italics, but not brackets, in original.)
The complaint alleges that Feinberg, his law firm, Feinberg Rozen LLP, and the Gulf Coast Claims Facility misled plaintiffs by using the "Delay, Deny, Defend" strategy.
To manage this complex multidistrict litigation, the MDL 2179 court consolidated and organized the various claims into several pleading bundles. The B1 pleading bundle, which includes all claims for private or nongovernmental economic loss and property damages, includes more than 100,000 individual claims.
For claimants to litigate, they had to first file claims through the GCCF, and be denied.
Donovan's motion says there are too many different circumstances involved in the litigation for class certification to be granted.
"MDL 2179 plaintiffs would not meet their burden by demonstrating that a class action would be 'superior' under Fed. R. Civ. P. 23(b)(3). The superiority analysis 'requires an understanding of the relevant claims, defenses, facts, and substantive law presented in the case.' Allison [v. Citgo Petroleum Corp.], 151 F.3d at 419. Given the multitude of individualized questions and answers at issue, a class action is simply not the superior method of adjudicating the instant dispute," the memo states.
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