WSJ editorial: BP oil spill fund an 'all-you-can-eat buffet' for trial lawyers

NEW ORLEANS – An editorial in the Wall Street Journal today lambasted trial lawyers for their apparent greed in pushing claims through the Deepwater Horizon oil spill settlement agreement that may not be related to the oil spill itself and serve as the basis for a challenge to the U.S. Supreme Court.

Last year BP was turned down at the U.S. Court of Appeals for the Fifth Circuit when they asked that the settlement agreement be decertified saying that Claims Administrator Patrick Juneau was inaccurately calculating some claims without making claimants prove they actually suffered damage. However, the court did require Juneau to change the way he calculated business economic loss claims – something BP now says cost them hundreds of millions of dollars which they are trying to get back from claimants who were overpaid or never should have been paid in the first place.

The last ditch appeal to decertify the class now looks like it is on it’s way to the U.S. Supreme Court and BP has also requested U.S. District Judge Carl Barbier, who is overseeing the case, to remove Juneau as Claims Administrator. BP’s requests to remove Juneau is based on accusations of corruption in his office that has resulted in five top level employees stepping down or being fired and severe inefficiency wherein administrative costs have topped $1 billion and claims payments have slowed to a trickle.

In its sharply worded editorial, the WSJ pointed to a “wave of abuse” on behalf of the trial attorneys involved in engineering settlement action, known as the Plaintiffs’ Steering Committee (PSC) who as part of their settlement got a $660 million payout off the top, as well as that of Juneau.

“The fund has become an all-you-can-eat buffet and everybody is invited, regardless of the cause of the damages they may or may not have suffered,” the editorial states.

The editorial goes on to say that the issue is an opportunity for the Supreme Court to put trial lawyers in their place, which may have ramifications for other class action settlements to come.

“[T]he major question for the High Court to resolve isn’t a narrow dispute about whether Mr. Juneau’s or BP’s interpretation of the terms is right. Rather, it’s whether the courts can certify a class in which thousands of people cannot prove they suffered injuries that the defendant caused and could never succeed in an individual lawsuit,” the editorial states.

LaPlace-based attorney Daniel Becnel represents numerous claimants in the case, but is not part of the PSC. Becnel has been very critical of the settlement since its inception.

“The BP oil spill has been a feeding frenzy for plaintiffs' lawyers. Legitimate clients have not yet been paid, and people who do not deserve money have been paid millions, despite the fact that Judge Barbier has tried to control this case and is a very hard working judge,” he said.

Becnel has maintained the class action lawsuit should have never been certified to begin with because those who received damages were not united in the manner in which they were damaged.

“You cannot do a class action settlement with that many components,” he said.

He believes the Supreme Court will at least look at the case, if not overturn it.

“I think the Supreme Court is going to do something with this case. Barbier is trying to impose discipline on a bunch of greedy lawyers, but that is like trying to impose discipline in the Amazon with a bunch of flesh easting piranhas. It is kind of hard to do,” Becnel said.

Melissa Landry, executive director of Louisiana Lawsuit Abuse Watch, said the Supreme Court appeal is a historic one that offers a chance to set things straight.

“Without question, the Wall Street Journal correctly assessed Louisiana’s legal climate as a ‘lawsuit cesspool.’  Such harsh words are hard to hear, but it is obvious to most observers outside the state that unless the Supreme Court acts to address the fundamental issue of causation, the BP settlement will ultimately be defined as one of the worst shakedowns in the history of the American legal system,” she said.

Juneau did not respond to a request for comment on this story.