La. attorney wants judges to consolidate 100-plus Gulf oil spill lawsuits to avoid legal chaos

Attorney seeks to combine 100-plus oil lawsuits

MIAMI — An attorney wants more than 100 lawsuits filed against BP and other companies involved in the massive Gulf of Mexico oil spill combined quickly in a single federal court to avoid what he called legal chaos that could delay potential payments of billions of dollars in damages.

Louisiana lawyer Daniel Becnel on Wednesday asked a federal judicial panel in Washington state to order the lawsuits in five Gulf Coast states centralized in New Orleans or a federal court elsewhere in Louisiana, the state so far hit hardest by the spill. There are currently about 130 lawsuits, although that list grows each day.

The panel, formally known as the U.S. Judicial Panel on Multidistrict Litigation, earlier this month said it would not decide on consolidation of oil spill cases until July, but Becnel wants them to reconsider that decision.

Meanwhile, at least eight federal judges have already held hearings on oil spill cases in Louisiana and Texas, with some having to step aside because of conflicts such as family ownership of company stock.

At the same time, environmental groups have sued the federal government, claiming lax regulations and special exemptions contributed to the BP PLC spill and are an ongoing threat for future offshore drilling.

“It’s a mess,” said Becnel, whose clients include shrimpers, oystermen, restaurant owners and others. “The purpose of having the multidistrict panel is so you don’t have a lot of competing orders and you don’t waste a lot of time.”

Although BP is paying claims to people and businesses affected by the spill, those amounts could eventually be dwarfed by damages resulting from a major class-action case involving tens of thousands of plaintiffs in Louisiana, Texas, Florida, Alabama and Mississippi. So far, potential class-action lawsuits have been filed by fishing and seafood interests, the tourism industry, restaurants and clubs, property owners losing vacation renters — even vacationers who claim the spill forced them to cancel and lose a deposit.

There are four main defendants: BP, which leased the sunken Deepwater Horizon; rig operator Transocean; oil services company Halliburton, which handled the cementing of the well; and Cameron Inc., which made the blowout preventer that apparently failed to stop the gusher after the rig exploded April 20, killing 11 workers.

Lamar McKay, BP America chairman and president, told a Senate committee this week that the company had paid out $15 million in claims through Tuesday, mostly to shrimpers and commercial fishermen who have little or no income because of the spill.

“We intend to continue replacing this lost income for as long as the situation warrants. We are responding to claims as quickly and as responsibly as possible,” McKay testified.

BP has also filed a request with the federal judicial panel to consolidate the lawsuits, but favors appointment of a judge in Houston near the headquarters or major operations of the companies involved.

Transocean, meanwhile, has already filed in Houston federal court to limit its liability under special maritime law to $27 million. That cap could be thrown out if a judge found Transocean’s negligence was a cause of the disaster.

Several recent lawsuits filed by environmental groups claim the Interior Department’s Minerals Management Service — already under fire on Capitol Hill for a cozy relationship with oil companies it regulates — issued special exemptions and bent rules that may have contributed to the Deepwater Horizon disaster.

One lawsuit, filed in Alabama federal court by the Gulf Restoration Network, Sierra Club and Earthjustice, asked a federal judge to stop MMS from exempting oil companies from requirements to disclose blowout and worst-case scenarios. The lawsuit also contends that MMS did not perform a required environmental impact analysis of a potential blowout at the Deepwater Horizon drilling site.

“This case is about lax regulation,” said Earthjustice attorney David Guest. “It is actually easier to get a permit for an offshore oil drilling rig than for a hot dog stand.”

An MMS spokesman did not immediately respond Wednesday to an e-mail seeking comment.