BP is finally getting its day in court, after last-minute attempts to reach a settlement with government prosecutors in the Gulf oil spill case failed over the weekend.
The U.S. Department of Justice and several Gulf Coast states are among the plaintiffs seeking to prove that BP and its contractors were “grossly negligent” in the 2010 Deepwater Horizon rig explosion that killed 11 workers and dumped 4 million barrels of oil into the Gulf of Mexico.
If U.S. District Judge Carl Barbier finds that BP or its codefendants—Halliburton Co., which cemented the exploded Macondo well; and Transocean Ltd., which operated the oil rig—acted with either reckless indifference or willful or wanton misconduct, the companies could face hefty punitive damages.
BP, for instance, could be on the hook for as much as $17.6 billion in Clean Water Act fines, as opposed to the $4 billion it would be liable for if it only acted “negligently,” according to the New York Times. That’s on top of $37 billion that the company has already spent on cleanup efforts, settlements and fines.
Meanwhile, BP officials have expressed skepticism at the government’s gross negligence claims, maintaining that Transocean and Halliburton also share a large part of the blame for the spill.
“Gross negligence is a very high bar that BP believes cannot be met in this case,” Rupert Bondy, BP’s general counsel, said in a statement last week. “This was a tragic accident, resulting from multiple causes and involving multiple parties. We firmly believe we were not grossly negligent.”
Last year, BP reached a proposed $8.5 billion settlement with individuals and businesses that had suffered economic or medical hardship as a result of the spill. Then, in November 2012, the company agreed to pay $4.5 billion and plead guilty to 14 criminal charges to settle the U.S. government’s criminal claims related to the disaster.
Some legal experts still expect BP to make a deal with the feds over the course of the three-month trial, Thomson Reuters reports.
For more InsideCounsel coverage of the Deepwater Horizon oil spill, see: