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Judge Gives Preliminary Approval Of Settlement Of Gulf Oil Spill Claims

NEW ORLEANS - (Mealey's) The Louisiana federal judge overseeing the multidistrict litigation for claims arising from the explosion of the Deepwater Horizon rig and ensuing oil spill in the Gulf of Mexico gave preliminary approval for two separate class settlement agreements May 2, one resolving certain economic and property damage claims and one resolving certain medical claims stemming from the cleanup response effort (In re:  Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico on April 20, 2010, MDL 2179, No. 10-md-2179, E.D. La.). 

(Preliminary approval of proposed economic and property damages class action settlement available.  Document #77-120514-013R. Preliminary approval of proposed medical benefits class action settlement available. Document #77-120514-014R.) 

BP announced on March 2 that it would pay $7.8 billion to resolve claims seeking compensation for economic loss and personal injuries.  The $7.8 billion would be paid from the $20 billion Gulf Coast Claims Trust the company established in August 2010 and would include a commitment of $2.3 billion from BP to resolve economic loss claims related to the Gulf seafood industry.   

U.S Judge Carl Barbier of the Eastern District of Louisiana gave preliminary approval to both proposed settlements in separate orders. 

Settlement Agreement  

"At this stage, the Settlement Agreement appears fair, has no obvious deficiencies, does not improperly grant preferential treatment to the Class Representatives or to segments of the Class, and does not grant excessive compensation to attorneys," Judge Barbier wrote.  "It falls within the range of possible judicial approval." 

The economic and property damages settlement will compensate businesses and individuals for the following types of losses suffered as a result of the Gulf Oil spill:  individual and business economic losses, coastal real property damage, wetlands real property damage, real property sales loss, vessels property damage, loss of subsistence use, vessels of opportunity underpayment and a program to compensate harvesters of Gulf seafood. 

The medical benefits settlement will provide compensation to cleanup workers and Gulf Coast residents suffering from a wide range of specified physical conditions, establish a 21-year periodic medical consultation program and create a Gulf Region Health Outreach Program through a $105 million grant. 

The medical settlement contains a back-end litigation provision, whereby claimants with later manifesting illnesses retain their right to sue BP for compensation at a later date. 

Claims Administrators 

Judge Barbier appointed Patrick Juneau as claims administrator for economic and property damage claims.  Garret Resolution Group was named claims administrator for medical claims. 

The BP settlement does not affect claims brought by plaintiffs against Transocean Ltd., the owner of the Deepwater Horizon oil rig, and Halliburton Inc., which provided cement services.  The settlement also does not impact claims brought by the U.S. government and a number of Gulf states under the Clean Water Act and Oil Pollution Act of 1990. 

A fairness hearing has been scheduled for Nov. 8. 

BP is represented by Don K. Haycraft and R. Keith Jarrett of Liskow & Lewis in New Orleans; Richard C. Godfrey and J. Andrew Langan of Kirkland & Ellis in Chicago; Granta Y. Nakayam, Stuart A.C. Drake and Jeffrey Bossert Clark of Kirkland & Ellis in Washington, D.C.; Robert C. "Mike" Brock of Covington & Burling in Washington; and Joel M. Gross and Allison Rumsey of Arnold & Porter in Washington. 

Stephen J. Herman of Herman Herman Katz & Cotlar in New Orleans; James Pakerson Roy of Domengeaux Wright Roy & Edwards in Lafayette, La.; Brian H. Barr of Levin Papantonio Thomas Mitchell Echsner & Proctor in Pensacola, Fla.; Robin L. Greenwald of Weitz & Luxenberg in New York; Jeffrey A. Breit of Breit Drescher Imprevento & Walker in Norfolk, Va.; Rhon E. Jones of Beasley Allen Crow Methvin Portis & Miles in Montgomery, Ala.; Elizabeth J. Cabraser of Lieff Cabraser Heimann & Bernstein in San Francisco; Matthew E. Lundy of Lundy Lundy Soileau & South in Lake Charles, La.; Philip F. Cossich Jr. of Cossich Sumich Parsiola & Taylor in Belle Chasse, La.; Michael C. Palmintier of deGravellew Palmintier Holthaus & Fruge in Baton Rouge, La.; Robert T. Cunningham of Cunningham Bounds in Mobile, Ala.; Paul M. Sterbcow of Lewis Kullman Sterbcow & Abramson in New Orleans; Alphonso Michael Espy of Morgan & Morgan in Jackson, Miss.; Scott Summy of Baron & Budd in Dallas; Calvin C. Fayard Jr. of Fayard & Honeycutt in Denham Springs, La.; Mikal C. Watts of Watts Guerra Craft in San Antonio; and Ervin A. Gonzalez of Colson Hicks Eidson in Coral Gables, Fla., are counsel for the plaintiffs. 

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