BP has won a legal reprieve in its effort to avoid payments to those whose losses were not traceable to the 2010 Gulf of Mexico oil spill as part of a 2012 agreement to make payments to those who suffered economic losses as a result.
The company complained that the payout formula worked out by settlement administrator Patrick Juneau was overly generous, and compensates people and businesses that didn’t realize any harm from the incident.
In March, U.S. District Judge Carl Barbier approved Juneau’s evaluation methods.
BP contested this approval.
On Monday, a divided 5th U.S. Circuit Court of Appeals in New Orleans said the district court erred by approving Juneau’s formula.
“This court’s expressing its views through two different opinions may have created interpretive difficulties on the remand, but the district court erred by not considering the arguments on causation,” according to the ruling.
The appeals court halted further payments to the claimants who did not suffer economic loss or property damage because of the spill.
BP originally projected that the settlement would cost $7.8 billion, but in July boosted its estimate to $9.6 billion.