BP to pay $138 million in fees in DOJ deal

October 8, 2015

The value of BP Plc’s settlement with the U.S. government and five Gulf states over the Deepwater Horizon oil spill rose to $20.8 billion in the latest tally of costs from the U.S. Justice Department.

On top of that amount, BP must pay an additional eye-popping $138 million in legal fees. That figure, contained in a filing in the case, represents fees for the actions and is separate from the fees in the civil suits brought by individuals and businesses hurt by the devastating spill.

According to the filing, five states are set to receive a portion of the fees. Alabama will receive $10 million, Florida $52 million, Louisiana $20 million, Mississippi $5 million, and Texas $1 million.

The fees going to the states will help supplement legal budgets that have been slashed. Alabama, for example, will use its share “to fill a hole in our current budget created by a funding shortfall from the Alabama legislature,” the state’s attorney general, Luther Strange, said in a statement.

The portion allocated to Florida will all go to the outside lawyers that worked on the case, a spokesman, Whitney Ray, said in an email.

Several regional firms are also receiving fees, and the bulk of the remainder – $40 million – goes to the “Co-Liaison Counsel, the Plaintiffs’ Steering Committee, and all other attorneys who performed legal services for the common and collective benefit,” according to the filing.

The $138 million is separate from the attorneys’ fees BP will pay in the civil suits filed by individuals and businesses harmed by the oil spill. A July court order stated that the company has agreed to pay as much as $600 million in lawyers’ fees for those suits.

The settlement announced Monday is the largest in DOJ’s history and resolves the government’s civil claims under the Clean Water Act and Oil Pollution Act, as well as economic damage claims from regional authorities, according to a U.S. Justice Department statement.

The accord is designed “to not only compensate for the damages and provide for a way forward for the health and safety of the Gulf, but let other companies know they are going to be responsible for the harm that occurs should accidents like this happen in the future,” U.S. Attorney General Loretta Lynch told reporters at a briefing in Washington.

BP’s total settlement cost of $18.7 billion announced in July didn’t include some reimbursements, interest payments and committed expenditures for early restoration of damages to natural resources.

The London-based company has set aside a total of $53.7 billion to pay for the disaster in 2010, when an explosion on the Deepwater Horizon drilling rig in the Gulf of Mexico resulted in the largest offshore oil spill in U.S. history.

The case is In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).


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