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BP seeks to reconsider parts of Deepwater Horizon settlement agreement based on Claims Administrator “conflict of interest”

By Louisiana Record reports | Oct 31, 2014

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NEW ORLEANS – A filing earlier this week by BP PLC seeks to halt parts of the Deepwater Horizon settlement agreement it alleges were tainted by Claims Administrator Patrick Juneau’s previously undisclosed work as part of a contract with the State of Louisiana.

BP has argued that Juneau improperly failed to disclose that his law firm, Lafayette-based Juneau David, held a $275,000 consulting contract with the State of Louisiana for which Juneau billed 548.6 hours, at a rate of $325 an hour, in the year before he was appointed as claims administrator.

The filing states Juneau played an important role in relation to the Deepwater Horizon claims process advocating for the lowering requirements for documentation for claimants seeking damages stemming from the 2010 oil spill.

BP claims Juneau advocated on behalf of the State of Louisiana to his direct predecessor, former Gulf Coast Claims Facility administrator Kenneth Feinberg, that claimants should not be held to stringent requirements in showing evidence of loss due to the oil spill. Included in Juneau’s requests were that “similar documents” to qualify as proof of income in the absence of tax documentation and that data based on seafood industry standard losses should be used in the absence of direct evidence of losses by individual claimants.

“Since the creation of the claims process to address valid claims arising from the Deepwater Horizon oil spill, BP has opposed payment of claims without adequate supporting documentation because of concerns about fraud. As a private lawyer, Patrick Juneau advocated approaches that were adverse to BP on this important issue, consistent with the views of his client, the State of Louisiana,” the filing reads.

In the filing BP claims that the policies Juneau advocated for open up the door to fraud in the claims program.

“Each of the policies that are the subject of this Motion eliminates critical checks and balances against fraud by reducing the documentation claimants must present to verify that their claim is genuine. In light of what we now know regarding the scope of Mr. Juneau’s prior representation of the State of Louisiana, these policies must be reconsidered, and should be enjoined,” the filing reads.

BP maintains that Juneau did not fully disclose the nature of his work on behalf of the state prior to being appointed as claims administrator. After Juneau took over the position his office was thrown into turmoil when allegations of corruption within the office arose. Juneau’s leadership was further questioned when BP made allegations that Business Economic Loss claims were being improperly calculated and did not require stringent evidence of loss – a claim that on appeal to the U.S. Court of Appeals resulted in a mandate that Juneau develop a more proper way to calculate those claims.

Geoff Morell, a spokesman for BP, said polices Juneau worked on while contracted by the State of Louisiana should be terminated altogether if not at least put on hold until the conflict of interest issue is discussed in court.

“Given Mr. Juneau's significant, undisclosed conflicts, the Court should vacate certain claims program policies that touch on issues on which he advocated while retained by the State of Louisiana. The Court also should order the claims program to reconsider those policies through a process in which Mr. Juneau is recused,” he said.

Juneau has not responded to any requests for comment from the media since BP filed a motion to remove him as claims administrator in September.

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State of Louisiana