Depends on whom you ask. Less than 24 hours remained before the trial’s scheduled start this week when U.S. District Judge Carl Barbier gave BP and the Plaintiffs’ Steering Committee, which represents the tens of thousands of businesses and individuals affected by the disaster, another week to reach a settlement.
Those close to the case say the judge would not have granted the delay if he did not feel a settlement was close.
Either way, the stakes are high.
BP has already accepted responsibility for the disaster, and it has estimated that legal and cleanup costs for the spill will total more than $40 billion. But when BP said it was setting aside approximately $6 billion to cover the steering committee’s claims, lawyers for the plaintiffs said the figure was too low.
Committee lawyers argue that punitive damages should also be awarded. BP disagrees.
Everyone agrees that a quick settlement is in BP’s best interest. If it comes out at the trial that BP was “grossly negligent,” then the cost of the settlement could rise to more than $60 billion, a staggering figure for even the energy giant to absorb.
A finding of gross negligence would also have an impact on future litigation because the U.S. government has sued BP for violations of the Clean Water Act. Those fines could run into the tens of billions of dollars, as well.
Gulf states, including Alabama, also are seeking compensation for their losses. Attorney General Luther Strange is working with his Louisiana counterpart to coordinate their efforts.
Although BP, which owned 65 percent of the well, is the most publicized defendant in the case, it is not alone. Several other companies, including Houston-based Halliburton, also are involved. All would stand to gain if BP and the committee come to terms.
What BP may prefer is a “global settlement” that involves all those connected to the case — state and federal governments, businesses and individuals, and the companies on trial. Settling with the plaintiffs would be a step in that direction.
However, if no settlement is reached, get ready for a long and costly trial.