THE BLOG
06/02/2010 09:11 am ET Updated May 25, 2011

Legal Implications of the BP Oil Spill

Sue, baby, sue. After the Exxon Valdez spill, twenty years of litigation followed. Expect to see more from the Deepwater Horizon spill.

On April 20, 2010, an offshore drilling rig in the Gulf of Mexico exploded after a blowout and sank two days later. Eleven people were killed and the massive oil spill continues to leak an estimated 5,000 barrels of oil a day. The coasts of Louisiana, Mississippi, Alabama, Texas, and Florida are all being effected. The oil spill may become the worst environmental disaster in U.S. history.

Oil exploration in the Gulf of Mexico, including the clean up, is the responsibility of the company which owns and operates the business. BP has claimed responsibility. Under federal law, the Obama administration has the power to completely federalize the oil spill cleanup if BP is not effective. The White House has since backed away from that possibility.

BP has announced that it will pay "all necessary and appropriate clean-up costs" as well as "legitimate and objectively verifiable claims for other loss and damage caused by the spill." Expect to see claims from plaintiffs that will include assessment, mitigation, cleanup, property damage, personal injury and commercial losses of profits.

The Chicago Tribune reported that the well-known law firm of KIRKLAND & ELLIS LLP, will be representing long time client BP. At least 100 lawsuits have been filed against BP and other defendants, many of them seeking class action status.

The federal government has yet to file a lawsuit against BP, Halliburton or Transocean, but expect to see one in the future. The government will pursue a civil action and President Obama announced on Tuesday that the government is considering criminal charges "if warranted." The Oil Pollution Act, Clean Water Act, Refuse Act, Endangered Species Act and the Migratory Bird Treaty Act all provide a legal basis for plaintiffs to recover.

The federal Oil Pollution Act of 1990 ("OPA") will be the principal law likely to be invoked in litigation. In response to the Exxon Valdez spill, the OPA was signed into law in August 1990. According to the EPA, "The OPA improved the nation's ability to prevent and respond to oil spills by establishing provisions that expand the federal government's ability, and provide the money and resources necessary, to respond to oil spills. The OPA also created the national Oil Spill Trust Fund, which is available to provide up to one billion dollars per spill incident."

OPA allows plaintiffs to recover a broad range of compensatory damages. Compensatory damages are money claimed by a person as compensation for loss or injury. These include damages to real or personal property, subsistence use, tax revenues, lost profits, earning capacity and costs for public services. OPA 90 also allows contribution claims from all responsible parties. BP may be the responsible party at first, but will most likely pursue claims against other responsible parties.

Attorney General Eric Holder visited the Gulf Tuesday and stated, "We will ensure that every cent, every cent of taxpayer money, will be repaid and that damage to the environment and wildlife will be reimbursed." In my opinion, no matter how much money BP is ordered to pay, it will never be enough to replace what it took nature thousands of years to create.

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