BP Spends All of $1.6 Billion Fund on Refinery Blast Claims
LONDON -- BP Plc spent the entirety of its $1.6 billion fund it set aside to pay for claims from its Texas City, Texas, refinery explosion, and faces unknown costs of remaining explosion claims, Bloomberg News reported.
BP has twice increased the size of the fund, after starting at $700 million, as more claims were filed at settled. Currently, BP is involved in a trial in Galveston, Texas, with lawsuits by eight men injured during the 2005 accident that killed 15. The company faces 1,200 more claims, Bloomberg News reported.
"BP has paid more than $1.6 billion to date to settle death and injury claims," Neil Chapman, a BP spokesman, told Bloomberg News via e-mail. "The cost to resolve additional claims will be determined as and when additional claims are resolved." He added that the company is "self-insured for these costs."
The trial in Galveston is seeking $1 billion from the eight workers. The judge in the trial ruled that BP's failure to produce a document can be used to remove the state’s limit on punitive damages, Bloomberg News reported.
A loss or settlement could increase the value of the remaining suits, according to Houston attorney David Berg, who is tracking the BP litigation, but is not involved.
"BP will have to dig deeper into its pocket to settle the remaining claims," Berg told Bloomberg News. "It is pay me now or pay me later. It is absolutely in BP's best interest to get it over now."
Before the current trial, BP settled all death cases and most serious injury claims, the report stated.
Early settlement offers set off "waves of cases," Houston attorney Tommy Fibich told Bloomberg News. "Initially, BP thought they could make the problem go away by being somewhat generous" with the settlements, according to Fibich, who is not involved in the litigation.
"But it had the opposite effect," he said. "It was like blood in the water. It appears to me that everybody who was in that ZIP code has made a claim."
BP also settled three trials during jury selection or before jurors could hear all the evidence.
BP has twice increased the size of the fund, after starting at $700 million, as more claims were filed at settled. Currently, BP is involved in a trial in Galveston, Texas, with lawsuits by eight men injured during the 2005 accident that killed 15. The company faces 1,200 more claims, Bloomberg News reported.
"BP has paid more than $1.6 billion to date to settle death and injury claims," Neil Chapman, a BP spokesman, told Bloomberg News via e-mail. "The cost to resolve additional claims will be determined as and when additional claims are resolved." He added that the company is "self-insured for these costs."
The trial in Galveston is seeking $1 billion from the eight workers. The judge in the trial ruled that BP's failure to produce a document can be used to remove the state’s limit on punitive damages, Bloomberg News reported.
A loss or settlement could increase the value of the remaining suits, according to Houston attorney David Berg, who is tracking the BP litigation, but is not involved.
"BP will have to dig deeper into its pocket to settle the remaining claims," Berg told Bloomberg News. "It is pay me now or pay me later. It is absolutely in BP's best interest to get it over now."
Before the current trial, BP settled all death cases and most serious injury claims, the report stated.
Early settlement offers set off "waves of cases," Houston attorney Tommy Fibich told Bloomberg News. "Initially, BP thought they could make the problem go away by being somewhat generous" with the settlements, according to Fibich, who is not involved in the litigation.
"But it had the opposite effect," he said. "It was like blood in the water. It appears to me that everybody who was in that ZIP code has made a claim."
BP also settled three trials during jury selection or before jurors could hear all the evidence.