BP Settlement Finalized: Details of agreement submitted to the court for approval
Motley Rice co-founder Joseph Rice served as one of the lead negotiators of the settlement that was submitted to the court today, and we are proud of the many who have tirelessly worked to make sure that oil spill victims are fully and efficiently compensated.
"These settlements comes at an important time in the lives of those who have suffered and continue to suffer because of the Deepwater Horizon disaster. They will provide long-deserved compensation to thousands, including business owners, cleanup workers, the seafood industry and other citizens. It has been a real privilege serving as a lead negotiator," said Joe Rice, Motley Rice LLC member and BP Litigation Plaintiff Steering Committee Member.
Please read below the full press release distributed today by the BP MDL Plaintiffs' Steering Committee (PSC).
Plaintiffs' Steering Committee And BP Finalize Settlement
Joint Motions Seek Preliminary Court Approval
NEW ORLEANS, April 18, 2012 /PRNewswire/ -- The Plaintiffs' Steering Committee (PSC) leading the litigation surrounding the 2010 BP Gulf Oil Spill today announced that it has finalized its settlement with BP.
The PSC has filed for Class certification, and the Parties have jointly filed for preliminary Court approval for two separate Class settlement agreements - one resolving certain economic and property damage claims; the other resolving certain medical claims stemming from the response effort.
Generally, there is no cap on the amount BP will pay to the proposed economic and property damages Class. As a result, all eligible proposed Class members will be fully and fairly compensated for their losses. In addition, the PSC has obtained a commitment from BP to pay $2.3 billion to participants in the seafood industry including Seafood Crew, Commercial Fishermen, Oyster Leaseholders and Seafood Vessel Owners.
"The people and businesses of the Gulf Coast stand to reap great benefits from these settlements," said Plaintiffs' Co-Liaison Counsel, James P. Roy and Stephen J. Herman. "We have held BP fully accountable for the Deepwater Horizon tragedy less than two years after the spill. Through extensive arms-length, good faith negotiations, hundreds of thousands of Gulf Coast residents and businesses will be made whole."
The economic and property damages settlement (E&PD), which is consistent with the agreement-in-principle announced last month, will compensate businesses and individuals in the proposed Class area for the following types of losses suffered as a result of the Gulf Oil Spill: Individual and Business Economic Losses, Coastal Real Property Damage, Wetlands Real Property Damage, Real Property Sales Loss, Vessels Property Damage, Loss of Subsistence Use, Vessels of Opportunity Underpayment (VoO), and; a program to compensate harvesters of Gulf seafood.
The methodologies and protocols implemented by the Court Supervised Oil Spill Settlement Program are agreed to by the proposed Class and BP. The frameworks for compensation are transparent and and provide proposed Class members with great flexibility in determining the amount of their damages.The frameworks are designed to allow proposed Class members to calculate their claims in a manner that provides the best result for them or their business. Further, the Claims Administrator has a duty to work with proposed Class members to ensure that they are receiving the entirety of what they are owed.
The E&PD Class Settlement also includes Risk Transfer Premiums (RTP). For most claims, the RTP enhances compensation for claimants whose damages could be recurring, and to account for the risk of future damages. The applicable RTP is generally applied to an eligible proposed Class member's 2010 losses and serves as a multiplier on those losses. RTPs will be uniquely calculated for each category of claim.
Unlike a simple multiplier, the RTP enhancement is a formula that calculates the product of an RTP number and base compensation amount, and then adds that product back to the base compensation amount. For example, an RTP of 2 does not just double the base compensation amount, as a simple multiplier would -- it doubles the base compensation amount and then adds that doubled number to the original base compensation amount -- thus an RTP of 2 would be comparable to a multiplier of 3.
The E&PD settlement provides greater flexibility by allowing claimants to choose their benchmark period of pre-spill revenues against which their losses will be measured. (Claimants may use 2009; the average of 2008-2009; or the average of 2007-2009 -- whichever is most favorable). This will allow for the most accurate reflection of pre-spill revenues, and will reduce distortion related to the general economic downturn or other extraneous factors.
Additionally, claimants may also choose any three or more consecutive months between May and December 2010 as their loss period, which enables claimants to exclude outlier months that might unfairly dilute the true severity of losses. Growth trends will be considered as well.
The medical benefits settlement, which is also consistent with the agreement in principle, will provide compensation to Clean-Up workers and Gulf Coast residents suffering from a wide range of Specified Physical Conditions; establish a twenty-one (21) year periodic medical consultation program, and; create a Gulf Region Health Outreach Program through a $105 million grant.
Claimants eligible for the medical settlement include Clean-Up Workers and residents living in certain "Zone A" (beachfront areas within one-half mile of the water) or "Zone B" (wetlands areas within one mile of the water) residents.
"The medical settlement will provide hundreds of thousands with the care they so desperately need, and through the Gulf Region Health Outreach Program, bolster the region's healthcare infrastructure for years to come," said Roy and Herman.
The medical settlement contains a back-end litigation provision, whereby claimants with later manifesting illnesses retain their right to sue BP for compensation at a later date.
The Court will, in the near future, rule on whether to grant preliminary approval for the settlement. The Court Supervised Oil Spill Settlement Program will begin processing claims within thirty (30) days of the Court granting preliminary approval.
All claimant information that has been filed with the GCCF will be transferred to the new program; claimants do not need to start over.
BP will continue to process and pay interim claims as required by law under the Oil Pollution Act.
Once preliminary approval is granted, a Court-approved notice program will inform all class members of their rights through television, radio, print and online media.
The Court will set a fairness hearing, after which it will rule on whether to grant final approval of the settlements. In the meantime, eligible claims will continue to be processed and paid.
SOURCE Plaintiffs' Steering Committee (PSC)