Court rules against BP’s motion to remove embattled claims administrator

NEW ORLEANS – BP’s motion to remove Patrick Juneau as the supervisor of the Deepwater Horizon settlement program was denied Monday by U.S. District Judge Carl Barbier.

In September BP filed a motion to have Juneau removed from his position in charge of the Court Supervised Settlement Program after it was disclosed that he had previously worked on behalf of the State of Louisiana as a consultant on the 2010 oil spill and based on multiple other allegations of impropriety and incompetence.

Juneau oversees the settlement of what is the largest class action in history, with more than 288,000 claims filed and issued in excess of 75,000 awards totaling more than $5.2 billion. Yet more than half of the claimants have yet to see payment some four and a half years after the spill and at least five of Juneau’s senior employees have resigned or been dismissed for impropriety. BP also complains that Juneau’s operation is expensive, costing about $30 million per month in administrative overhead, even though claims payments have slowed to a relative trickle.

BP’s motion rested heavily on the assertion that Juneau’s neutrality was compromised by his Louisiana contract, which its lawyers said was improperly and incompletely disclosed. Those lawyers said Juneau actively concealed his work for the state when asked about it in a sworn statement he gave to an investigator examining corruption in the claims facility.

However, Barbier wrote in his denial motion that Juneau’s disclosure to the oil giant of his past work had been sufficient and that BP’s complaint came too slowly.

“Mr. Juneau himself disclosed this information to BP and at least six of its attorneys or representatives before he was selected by the parties,’’ Barbier said. “BP’s own submissions evince that this information was discussed during one or more of the vetting sessions that Mr. Juneau underwent before he was selected by the parties.”

BP’s motion also accused Juneau of showing favor to the Plaintiff’s Steering Committee, a group of 18 lawyers overseeing the settlement, by expediting their claims ahead of other, less well-connected attorneys. While Barbier acknowledged that Juneau had expedited claims, he said that just over half of those expedited settlements went to clients of non-PSC lawyers.

Barbier’s ruling was not unexpected and BP spokesman Geoff Morrell said the company is weighing an appeal.

“BP will also continue its efforts to restore needed and promised integrity and transparency to the Gulf claims program,’’ Morrell said in a statement. “Simply put, it is unacceptable for the claims program to continue operating as it has been – inefficiently, secretively, and marred by corruption, fraud, and conflicts of interest.”

Melissa Landry, executive director of Louisiana Lawsuit Abuse Watch, said she disagress with Barbier's ruling.

"Judge Barbier's ruling today fails to appreciate the stunning level of inefficiency and abuse that seems to have infected the Court Supervised Settlement Program under Mr. Juneau's leadership," she said. "Since being tapped to oversee the settlement in the aftermath of the Deepwater Horizon oil spill in 2012, Mr. Juneau has presided over several high profile scandals including the systemic payment of questionable claims, and allegations of money laundering that caused several of his top officials to resign. As if that wasn't bad enough, Mr. Juneau has also somehow managed to make Pentagon procurement specialists look like penny pinchers by spending roughly $1 on overhead for every $5 paid out to claimants."

Landry added that the slow pace of claims payments continues to be a problem under Juneau.

"The people deserve a transparent and efficient process where those who have legitimate claims can quickly recover their losses. It is hard to look at the system now and conclude that that's what we have in place," she said.