Two Years After Spill, Troubles Remain for Gulf Coast Residents

Two years ago today, an explosion on the Deepwater Horizon oil rig killed eleven people and resulted the release of massive amounts of crude oil into the Gulf of Mexico. In the months that followed, 1.84 million gallons of chemical dispersants were also pumped into Gulf waters as part of the cleanup effort.

At the time, many people raised significant concerns about the short and long-term environmental impact of the oil and chemicals flooding the ecosystem, and of the damage that could occur both to the livelihoods of Gulf residents and to the health and well-being of clean-up workers. Others – including Alliance for Justice – raised concerns with BP’s offer of one-time settlement payouts that were based on their guess of how quickly fisheries would recover from the disaster.

Now, two years later, all those concerns appear to have been well-founded.

When fishermen resumed their trade soon after the disaster in 2010, many of the fish they were catching had open lesions and atypical coloring. After two years, multiple deformities are still being found in fish and shrimp caught in the Gulf, raising concerns not only about food safety, but about the ability of Gulf Coast residents to resume their livelihoods even years after the spill.

Discovering eyeless shrimp, lesioned fish and other mutated and underdeveloped seafood, fisherman in the Gulf are pointing fingers at the BP spill. Biologist Dr. Darryl Felder told the news agency that Gulf seafood populations are dropping at alarming rates and that species richness is "diminished.

"The Gulf Restoration Network's Scott Eust explained the bizarre shrimp deformities. "We have some evidence of deformed shrimp, which is another developmental impact. So, that shrimp's grandmother was exposed to oil while the mother was developing, but it's the grandchild of the shrimp that was exposed grows up with no eyes."

Anticipating that the impact of the disaster would continue to be felt long after the initial damage was done, AFJ worked hard to advocate for legal solutions that would let Gulf Coast residents retain their right to hold BP accountable for the damage done to their health and businesses, and to be compensated for loss of income due to the long-term environmental impact of the spill.

Our award-winning short film Crude Justice laid out the legal challenges facing residents as they decided whether or not to accept the one-time settlements offered by BP.



This week, after an audit from the Department of Justice, BP agreed to an additional $64 million in settlements with Gulf Coast residents whose earlier claims were wrongfully denied or miscalculated. That’s certainly welcome news to the thousands of families affected.

However, as we saw this week, it’s obvious that the spill will continue to have devastating effects on the lives and livelihoods of Gulf Coast residents. It’s a clear reminder how important it is to stand up for individuals’ rights when they’re trying to hold corporations accountable for their actions. After two years, let’s not forget the struggles Gulf Coast residents are still facing.

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Gulf Oil Spill Legal Processes Wind Down

On March 3rd, a major development occurred in the ongoing legal fallout from the Deepwater Horizon oil rig explosion and oil spill, when a mass settlement was reached between BP and the Plaintiffs’ Steering Committee. 

The settlement occurred nearly two years after an explosion on the rig leased to and operated by BP killed eleven workers, injured seventeen more, and unleashed a torrent of oil into the Gulf of Mexico.  In the spring and summer of 2010, the world watched as over 200 million gallons of oil flowed for almost three months, pouring into the open water, damaging economic livelihoods and the coastal environment in profound ways.  Additionally, BP released 1.84 million gallons of chemical dispersants, with the eventual impact on health and jobs impossible to know with certainty.

The Deepwater Horizon spill caused injuries all along the Gulf coast, and prompted countless lawsuits by all sorts of entities, including individuals and businesses.  As one might expect, a great many of these lawsuits involved claims by private individuals for adverse health effects caused by the spill and its aftermath, damage to property, and damage to economic livelihoods by everyone from oyster fishers to tourism industry workers.  These private suits were compiled together in Multi-District Litigation 2179 in New Orleans, with a Plaintiffs’ Steering Committee appointed by the court to handle the cases.  This past week, BP, with the Plaintiffs’ Steering Committee, announced a settlement of a “substantial majority” of such claims, subject to final written agreement.

In total, BP has estimated that the settlement will cost roughly $7.8 billion, though plaintiffs note that there is no cap for plaintiffs’ recovery.  This settlement is divided into two separate agreements, one that covers medical costs, and the other that covers economic costs.  Both agreements would resolve claims on an individual basis, meaning that each claim will be looked at individually, and a formula will be applied to calculate the value of each claim.  As for the medical claims, BP would cover costs to clean-up workers and individuals harmed by exposure to the oil and dispersants.  It would also cover people whose physical symptoms have not yet developed, for 21 years of monitoring, and $105 million for improved access to health care in the region.

BP will also cover various economic claims, including lost profits, property damage, loss of subsistence and other use of property and land, and boat owner claims whose vessels aided in the cleanup efforts.  The deadline for filing claims will be extended by a year, into 2014 (under the Oil Pollution Act, the three-year statute of limitations for bringing claims would otherwise have expired in 2013), and economic loss will be calculated by looking at a broad range of pre-disaster yearly data, not just at the pre-disaster period in 2010.  Claimants who suffered economic loss due to the drilling moratorium put in place by the Obama Administration following the Deepwater Horizon disaster are not included in this settlement.

Fortunately, it appears that the settlement process will be significantly more transparent than the heavily criticized GCCF process. (.pdf link)  All claims pending before the GCCF will be automatically transferred to the new settlement system, and the PSC lawyers believe the calculation of damages will be more transparent and flexible.  BP can appeal awards of over $25 thousand, but if BP loses that appeal, BP will owe the claimant a 5% penalty.  Additionally, claimants may still opt out of this settlement architecture and take their chances in individual litigation.

This settlement does not resolve all legal claims in connection with the explosion and spill.  Most notably, the federal government still has open investigations into BP under the Clean Water Act and other statutes, including perhaps criminal investigations.  (Federal law may require BP to pay fines of up to $4300 per barrel, adding up to tens of billions of dollars.)  Nevertheless, this settlement has the potential to resolve a vast number of claims for personal and economic injury caused by the Deepwater Horizon catastrophe.

Alliance for Justice has played a substantial role in bringing public attention to the critical issues surrounding the Deepwater Horizon accident, its effects, and the search for justice.  In 2010, we devoted our yearly “First Monday” film project, the award-winning documentary film Crude Justice, to looking at the fight for fairness for communities and individuals adversely affected by the oil spill. 

AFJ was instrumental in helping to secure $2 million to pay for legal aid attorneys to assist victims of the spill.  A year after the spill, we published an in-depth report (.pdf link) on how the legal process was and wasn’t working to help victims achieve justice.  In February of 2011, we submitted comments (.pdf link) to the GCCF, analyzing its methods of calculating damages for claimants. 

Although this chapter of the BP litigation may finally be closing, the fallout from the Deepwater Horizon disaster will continue to affect Gulf Coast communities for years to come.

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Long Term Health Effects of Oil Spill Remain Murky

While it is clear that the Gulf oil spill took an immeasurable toll on the ecosystem and natural resources of the Gulf region, the spill’s effect on the health of residents and cleanup workers remains largely unknown. What is known is that over 200 million gallons of oil, as well as approximately 1.84 million gallons of dispersants used in an attempt to break up the oil were dumped into the Gulf of Mexico. There have been widespread reports of symptoms like headaches, eye irritation, nausea, and coughs by residents and cleanup workers, which they attribute to exposure to oil and/or the chemical dispersants.

Cleanup workers like Andre Gaines say they’ve developed dry coughs, nausea, and even skin rashes, but have seen no public health response to their claims. In a New York Times story yesterday, Gaines described leaving hospital visits with no answers about his symptoms. “Who do we call? Our government is not talking about this,” Gaines says in the article. “They took advantage of us.”

The Times-Picayune reports that one three year-old who visited the Gulf on vacation after the spill had blood levels with three times the normal level of ethylbenzene (a toxin). This result is mirrored in blood tests conducted on a broad swath of Gulf residents.

One survey conducted by the Louisiana Bucket Brigade found that “Almost three quarters of respondents who believed they were exposed to crude oil or dispersant also reported experiencing symptoms.”

As the New York Times article reports, however, assessing the long-term health effects, and holding the responsible parties accountable are complicated endeavors. “The problem, advocates say, is that there is little access to health care or specialists familiar with treating oil and chemical exposures. Further, they say, no reliable registry of these health problems exists, though a $10 million federal study of the health effects of an oil spill was recently launched.”

The question remains as to whether BP will foot the bill for spill-related health screening and treatment of those who may have been exposed to oil or dispersants. The oil giant has contributed $10 million for a National Institute of Environmental Health Sciences study that will analyze the long-term health effects of the spill on cleanup workers. But advocates have raised major concerns about the study, including the cost of the delay in financing the study, and the fact that the study only includes cleanup workers. Moreover, there is no treatment associated with the study for those who evidence health-related problems from oil or dispersant exposure.

More information about the health effects of the BP oil spill is available here.

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The Myth of "Spillionaires"

Last week, Kim Barker wrote an article that ran in the Washington Post claiming that the oil spill has delivered a "gusher of money," creating a new class of "Spillionaires." The article cites a handful of examples of companies that received windfalls from BP thanks to corrupt local officials who secured lucrative contracts with the companies for political supporters. Barker’s article, Spillionaires are the New Rich after BP Oil Spill Payouts, paints a picture suggesting that the spill was lucrative for many, if not most, Gulf coasters.

But is it true that the most people who are choosing to settle claims with BP are getting the compensation they deserve? A new report by Alliance for Justice that will be released in the coming days suggests it is not, and makes recommendations for ways to ensure that victims are made whole.

While there may certainly be anomalous instances of individual claimants making out like bandits, Barker’s article is misleading in that it does not tell the story of the vast majority of claimants who continue to suffer economically because of BP. Spillionaires acknowledges (near the end of the article) that "those at the bottom earned much less" and that not all have received fair compensation – reinforcing the fact that the Spill has in many cases hit the most vulnerable the hardest.

A new article by the Mobile Press Register paints a picture very different from the one in Spillionaires – telling the story of a handful of the many victims whose life investments have been wiped out because of the spill, and for whom the claims process set up by BP has failed to provide meaningful recompense. For instance, sixth-generation fisherman Paul Johnson received just $10,000 from GCCF, despite the fact that his oyster catch has dropped from 400 to 60 gallons a week. Johnson has chosen not to accept a final payment from GCCF, despite his dire financial situation, and will continue trying to get by on short-term payments from GCCF that do not require him to give up his right to sue BP.

To learn more about the effect the oil spill has had on residents of the Gulf, check out Alliance for Justice's award-winning short film, Crude Justice .

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BP Responds to GCCF Claims Methodology

Today’s New York Times reports that BP has weighed in on the proposed claim and compensation methodology set forth by the Gulf Coast Claims Facility. The proposal outlines the steps and methods GCCF will use to determine how much to compensate the people who were harmed by BP’s Deepwater Horizon oil spill.

The oil giant is arguing that if anything, Mr. Feinberg’s proposed settlements are too generous. The planned payments far exceed the extent of likely future damages because they overstate the potential for future losses, the company insists in a strongly worded, 25-page document that was posted on the fund’s Web site Thursday morning.

Basing its estimates on much of the same data Mr. Feinberg used, the company concluded that there was “no credible support for adopting an artificially high future loss factor based purely on the inherent degree of uncertainty in predicting the future and on the mere possibility that future harm might occur.”

BP has pledged a fund of $20 billion to compensate the victims of their oil spill. Feinberg has famously estimated that the GCCF will pay out only $10 billion in claims. Now it seems that BP is putting pressure on Feinberg and the GCCF to pay out as little as possible, disregarding arguments for a more cautious, fair, and transparent approach.

AFJ also analyzed the GCCF’s proposed methodology, and found that, contrary to BP’s claims, it does not contain sufficient provisions to protect the rights and interests of the spill victims.

AFJ applauds GCCF for taking the step of releasing its methodology to promote greater transparency in the claims process. We take this opportunity to suggest a number of improvements that should be made to better protect claimants’ rights. Namely, because the projection of when the Gulf will fully recover is inherently speculative, the methodology should include a mechanism to address harms greater than those forecasted in the projection relied upon by GCCF. Moreover, the methodology should more clearly inform claimants of the documentation requirements, causation standard, and eligibility criteria GCCF will use in administering claims. Finally, going forward there needs to be more transparency in the way the methodology is applied to individual claims.

You can read our entire analysis and our recommendations online. You can also view other recommendations received by the GCCF on their website.

AFJ’s award-winning short film, Crude Justice, explores many of the legal issues Gulf Coast victims face as they fight for justice in a system that often seems dominated by corporate interests. You can now watch Crude Justice on YouTube.

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Gulf Coast Claims Methodology Needs Changes

As part of its ongoing effort to promote justice for the individuals struggling to recover from the Deepwater Horizon oil spill, Alliance for Justice has sent recommendations to the Gulf Coast Claims Facility (GCCF) on the proposed methodology for processing claims and calculating damages.

Many Gulf Coast claimants face tough legal and procedural difficulties as they fight for fair compensation for their losses, and AFJ’s analysis has found that GCCF’s proposed methodology does not adequately protect residents’ rights. We found numerous ways in which the methodology needs to be improved if it is to offer a fair and transparent process for Gulf Coast residents.

Some of the problems AFJ recommends be addressed in the methodology are:

• The methodology relies upon an unreliable and inherently speculative projection of when the Gulf will recover.
• The methodology should better inform claimants of the specific documentation and eligibility standards used by GCCF.
• GCCF’s proposed methodology does not explain how GCCF will handle some of the claims BP is required to pay under the Oil Pollution Act of 1990, such as subsistence use claims for residents who rely on seafood for subsistence.
• The methodology’s underlying assumptions and the GCCF’s processes need to be more open, transparent, and free from corporate influence.
• GCCF’s proposed methodology calculates economic loss based on 2008 and 2009 figures, despite the fact that those years represent a low point in the US economy.

A PDF of AFJ’s analysis and full set of recommendations can be found here.

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Judge Holds that Feinberg and GCCF Are Not Fully Independent of BP

Yesterday, Judge Carl Barbier, who is overseeing the Gulf oil spill litigation against BP, held that Gulf Coast Claims Facility (GCCF) and its administrator, Ken Feinberg, are not fully independent of BP. As such, the Court held that GCCF must abide by certain limitations when communicating with people who might have claims against BP and other potentially liable parties.

BP hired Feinberg to discharge its statutory duty to process claims for damages under the Oil Pollution Act (OPA). Judge Barbier wrote that in this sort of third-party arrangement, transparency is essential. The administration of the $20 billion trust fund has been plagued by criticisms that it is not sufficiently consistent and transparent. The Court noted that Feinberg and GCCF’s hybrid role has led to “confusion and misunderstanding by claimants, especially those who are unrepresented by their own counsel,” and that GCCF’s claimed independence and neutrality constitutes a “direct threat” to the legal challenge currently underway against BP.

Judge Barbier set forth a number of specific restrictions GCCF must abide by in communications with claimants, such as refraining from claiming to be “neutral” or “independent,” prominently disclosing the fact that individuals have a right to consult with an attorney, and telling claimants that they can join the litigation against BP if they decline to accept a settlement through GCCF.

In the order, Judge Barbier also indicated that he will soon issue a ruling on the broader question of whether BP is fully complying with OPA. Such a ruling could address whether several GCCF policies run afoul of the law, such as the requirement that individuals sign a release of liability in order to receive a final payment, and the methodology used to evaluate claims. Under the current GCCF protocol, to receive a final payment, claimants must give up their right to sue more than 100 named entities in addition to BP and must even waive claims not subject to OPA – provisions that have been criticized as overly broad. Judge Barbier wrote that “whether or not seeking such broad releases is appropriate, the GCCF is clearly acting to benefit BP in doing so.”

The ruling came after lawyers for individuals pursuing claims against BP in court, as well as Attorneys General from Mississippi, Louisiana, and Florida filed motions arguing that serious deficiencies in the handling of GCCF necessitated judicial oversight. The process has been criticized as not being sufficiently transparent, with inadequate explanation provided as to whether and at what amount claims are paid. Many claimants have also complained of apparent inconsistencies in the way claims are valued. Some have argued that GCCF is interpreting OPA too narrowly and is not adequately paying claims that would be recognized in court, such as subsistence claims for those who live off of damaged resources, and claims for punitive damages. Most recently, GCCF’s projection that the region will largely recover by 2011 has raised ire amongst the Spill’s victims.

Alliance for Justice’s short film, Crude Justice, explores many of the issues currently being raised by the legal process unfolding in the Gulf. The film and additional resources, including Judge Barbier’s ruling, can be found at www.crudejustice.org.

Crude Justice from Alliance for Justice on Vimeo.

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National Commission on the BP Oil Spill Pulls No Punches in its Final Report

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling has released its long-awaited report on last year’s calamity in the Gulf of Mexico and reaches powerful conclusions about the causes of the disaster, including that "[t]he explosive loss of the Macondo well could have been prevented."

The commissioners explicitly tackle the root causes of the disaster, which they trace to "a series of identifiable mistakes made by BP, Halliburton, and Transocean that reveal such systematic failures in risk management that they place in doubt the safety culture of the entire industry."

The human and economic consequences for the victims of the spill in the Gulf region are discussed in the report, as well, and are the subject of Alliance for Justice’s recent First Monday film, Crude Justice, which details the difficult legal environment facing those seeking compensation for the damage done to their lives and livelihoods, either in the courts or through BP’s Oil Spill Liability Trust Fund.

Of particular interest is the finding by the commission that,

...oil spills cause a range of harms, both economic and environmental, to individuals and ecosystems. The Oil Pollution Act makes the party responsible for a spill liable for compensating those who suffered as a result of the spill—through property damage, lost profits, and other economic injuries—and for restoring injured natural resources. The Act also provides an opportunity to make claims for compensation from a dedicated Oil Spill Liability Trust Fund. The Oil Pollution Act, however, imposes limits on both the amount for which the responsible party is liable, and the amount of compensation available through the trust fund. In the case of the Deepwater Horizon spill, BP (a responsible party) has placed $20 billion in escrow to compensate private individuals and businesses through the independent Gulf Coast Claims Facility.

But if a less well capitalized company had caused the spill, neither a multi-billion dollar compensation fund nor the funds necessary to restore injured resources, would likely have been available.

It is critical that compensation to victims be paid in full, and that the process for receiving compensation is swift and efficient. The Commission offers recommendations that would increase assurances that responsible parties are able to compensate victims (and at the same time strengthens incentives to prevent accidents in the first place), and that the Oil Spill Liability Trust Fund provide any compensation not provided by responsible parties. It also recommends a close review of the Gulf Coast Claims Facility process to determine its effectiveness in adjudicating compensation claims and its value as a model for future Spills of National Significance.

The commission’s specific recommendations related to compensation for victims include a general need to "increase existing limitations on responsible party liability," and a call for Congress to "significantly increase the liability cap and financial responsibility requirements for offshore facilities."

Overall, the commission includes 31 recommendations in its 382-page report, covering all aspects of the disaster and its aftermath, including:

• Improving the Safety of Offshore Operations


• Safeguarding the Environment


• Strengthening Oil Spill Response, Planning, and Capacity


• Overcoming the Impacts of the Deepwater Horizon Spill and Restoring the Gulf


• Promoting Congressional Engagement to Ensure Responsible Offshore Drilling

These comprehensive and uncompromising findings deserve the immediate attention of Congress, the regulatory agencies, and the American people so that victims of this and any future calamity can receive full compensation, and to dramatically reduce the risk that such an event will ever recur.

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Activists organize screenings of Crude Justice throughout the country

Last Tuesday was the deadline for Gulf Coast residents impacted by the explosion of the Deepwater Horizon oil rig to file claims for emergency payments from the BP compensation fund administered by Kenneth Feinberg. More than 400,000 claims were filed before the deadline, and approximately 150,000 individuals and businesses have received an estimated $2.2 billion. The next phase in this process is the negotiation of lump-sum final settlements for those affected by the spill, a process which will play out over the course of three years.

This fall, AFJ released Crude Justice, a short documentary film narrated by actor and environmentalist Ed Begley Jr., that highlights the impact of the oil spill on individuals, families and small business owners, and explores the legal landscape they are facing while seeking justice and fair compensation from BP and other liable parties. Along with over 5,000 online viewers, scores of activists have organized screenings of Crude Justice throughout the country. Here are a few highlights:

On October 6, the Eric R. Neisser Public Interest Program at Rutgers School of Law–Newark sponsored, “Crude Oil: Legal Implications of the Deepwater Horizon Oil Spill,” an event that included a screening of Crude Justice and a panel discussion exploring the environmental and community impact of the BP disaster in the Gulf. The panel was moderated by Steve Gold, Director of the Environmental Law Clinic at Rutgers-Newark and a former senior attorney in the Environmental Enforcement Section of the U.S. Department of Justice, and included Sarah Chasis Senior Attorney, Natural Resources Defense Council, and Rachel Jacobson, Principal Deputy Solicitor, U.S. Department of the Interior.

On October 25, the Environmental Law Society at the University of Mississippi School of Law organized a screening of Crude Justice and a discussion of the legal options open to Gulf residents. The discussion was led by professor David W. Case, who teaches environmental and toxic torts and environmental law, and professor Stephanie Showalter, who serves as Director of the law school’s National Sea Grant Law Center. The event drew over 50 students from the campus community.

A screening of the film organized at Golden Gate University School of Law on October 25 by the Environmental Law Journal, Environmental Law Society, and American Constitution Society featured a discussion with Deborah Behles, an associate professor of law and clinical staff attorney at the GGU Environmental Law and Justice Clinic; Leila Monroe, an attorney for the Natural Resources Defense Council; and Thomas Azwell, a doctoral candidate in Environmental Science, Policy and Management at UC Berkeley.

Harvard Law School’s Environmental Law Society held a screening of Crude Justice on October 27. Following the film screening, a panel of students who performed pro bono legal work in the Gulf spoke about their experiences. The event drew a record number of attendees for a Harvard Environmental Law Society event.

On November 3, University of the District of Columbia School of Law chapters of the Environmental Law Society, American Constitution Society, and National Lawyers Guild brought together more than 50 students for an event that featured a screening of the film and a discussion with Danielle Franco-Malone, Dorot Fellow, Alliance for Justice, and Jenny Rasmussen and Kate Degravelles, attorneys with the American Association for Justice. Law professor John Brittain moderated the discussion. Event organizer Diane Saey opened the screening, saying “My hope is that, after the film and discussion, each student will leave with a quick, short list of ways to contribute toward the betterment of the environment.” At the conclusion of the event, scores of students pledged to join with the Alliance for Justice to monitor the situation in the Gulf Coast and urge BP CEO Robert Dudley to make the Gulf and its people whole again.

Crude Justice calls on all of us to join the fight for justice and full recovery in the Gulf. Sign up today to bring Crude Justice to your campus and community and ensure that the people of the Gulf continue to be heard!

Connect with Alliance for Justice online to stay updated on legal and environmental developments and take action to help the people of the Gulf.

Click here to view the 17-minute film online.

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