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Settlement of class action business litigation challenged by BP

Nearly everyone in Georgia heard about the BP oil spill in the Gulf of Mexico in 2010. In Dec. 2012, a United States District Court judge certified a class in business litigation filed on behalf of those harmed by the oil spill who may be eligible to participate in a settlement brokered between BP and plaintiffs which was also approved by the judge. When BP appealed the certification and the district court's approval of the settlement to the U.S. 5th Circuit Court of Appeals, the district court's ruling was upheld.

Now, BP recently filed for a rehearing of its appeal with the entire panel of judges, saying that the three-member panel that upheld the lower court's decision erred. BP contends that the class certification includes many people who were not actually harmed by the oil spill. This would mean BP paying out millions of dollars the plaintiffs say BP failed to take into consideration when it settled.

BP further claims that the settlement's administrator misinterpreted the terms of the settlement and could potentially cost BP millions of dollars it should not have to pay. A different panel of judges from the appeals court did order the court administrator to change the way he determines some of the damages sought by businesses. In Dec. 2013, the settlement administrator told BP that businesses did not have to sustain losses directly from the oil spill in order to recover damages under the settlement.

BP says the ramifications to class actions suits could be significant if the ruling is once again upheld. Whether the court will agree remains to be seen. As many Georgia business owners know, business litigation can be complex. When a business is unhappy with a ruling as BP is in this situation, the company may appeal to a higher court to overrule a lower court's decision. However, as with any trial litigation, filing an appeal involves the risk of the lower court's decision being bolstered by an affirmation from an appellate court.

Source: Miami Herald, BP seeks rehearing in oil spill settlement dispute, Michael Kunzelman, Jan. 21, 2014

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