BP settlement enters new phase

Sketchy announcements leave many questions unanswered


NEW ORLEANS -- The late-night announcement Friday of a proposed $7.8 billion deal in the BP civil trial is not the end of the Gulf of Mexico oil spill case, but the start of a new phase with many unanswered questions.

The next steps will take time, and U.S. District Judge Carl Barbier will have to approve the settlement terms.

Plaintiffs will be able to opt out of the settlement.

The proposed settlement between BP and the group of lawyers appointed to lead the litigation for individual and business plaintiffs will shut down the current claims process and create a fund, administered by the court.

It will use money set aside by BP for a $20 billion fund that was paying out claims of economic loss and other expenses.

The sketchy announcements from BP and the plaintiffs' group leave some important questions unanswered.

Will the federal government be the next to settle? And what will happen to the people who have claims pending at the Gulf Coast Claims Facility?

The federal claims stand to be far larger than those of private claimants and could bring billions of dollars into the U.S. Treasury in civil environmental fines under statutes such as the Clean Water Act and potentially even more in criminal penalties.

Wyn Hornbuckle, a Justice spokesman, said the deal with private plaintiffs leaves much to be done. "We are pleased that BP may be stepping up to address harms to individual plaintiffs, but this by no means fully addresses its responsibility for the harms it has caused," he said.

Nothing in the deal, he said, "compensates the public for the significant damages to its natural resources and environment, and BP has yet to pay a penalty for its violations of law."

Kenneth Feinberg, who has administered BP's compensation fund, praised the deal, calling it "good news."

"It avoids a lengthy, complex trial and uncertain appeals," he said.

Mr. Feinberg, whose fund has evaluated more than 1 million claims from nearly 600,000 people and businesses, has paid out $6.1 billion to more than 225,000 of them.

He urged "an orderly transition to the new proposed claims program."

Among the positives in the settlement for plaintiffs is a provision that calls for paying legitimate claims from cleanup workers and others who say they suffered illnesses because of fumes from the oil.

Ervin Gonzalez, a Miami-based lawyer who helped negotiate the deal, said the settlement calls for court-approved health-care practitioners to examine workers and other people who blame illnesses on exposure to oil and dispersants.

A court-appointed claims administrator will determine which medical claims to pay.

The settlement sets up a program to monitor the spill's health effects for a period of 21 years, allowing people whose symptoms haven't developed yet to pursue claims.

Plaintiffs' co-liaison counsel Steve Herman said BP and the steering committee members have up to 45 days to present Judge Barbier with a formal settlement for his approval.