BP headed to court over Gulf oil spill
Oil is seen in the water June 14, 2010 off Grand Isle, La. Oil giant BP is set to go to court over the Gulf oil spill.
Kai Ryssdal: BP and some of the other companies involved in the Deepwater Horizon oil spill two years ago are about to go on trial. On Monday, a judge in New Orleans will hear claims for damages and civil penalties brought by an exhausting list of plaintiffs in the case. That includes the feds, the state of Louisiana and more than 100,000 others.
So it won't surprise you to hear BP would like nothing better than to avoid what some are already calling the trial of the century. From the Marketplace Sustainability Desk, Sarah Gardner reports.
Sarah Gardner: BP won’t talk details, but it’s pretty clear the company would much rather settle out-of-court.
Energy consultant Steven Kopits:
Steven Kopits: If you go to court, then you’re at the roulette table. And that may turn out to be more favorable or less favorable, but it’s absolutely certain it’s going to continue to bleed BP’s reputation.
Not to mention its bottom line. David Uhlmann used to prosecute environmental crimes for the Justice Department. He says BP is worried the judge might find them “grossly negligent” in the disaster.
David Uhlmann: Their potential liability for civil penalties alone goes up by $13 billion if they’re found grossly negligent. That is too big a risk for any company to take going into a trial.
Especially since that finding would bolster any criminal charges that have yet to be filed. Some legal experts expect a settlement after the trial has begun, once BP gets a better feel for how the judge might rule.
And once the company settles, says Jacqueline Savitz at the environmental group Oceana, it can tell shareholders:
Jacqueline Savitz: We’re done. We’re moving forward. We’re putting this behind us. And that would be a positive thing. But from the perspective of the American people, whether we would be made whole, whether our resources would be replaced is really another question.
The investment bank Morgan Stanley has speculated BP would settle the case for $20 billion to $25 billion. That’s slightly less than the profits BP made last year.
I’m Sarah Gardner for Marketplace.