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c.2013 Houston Chronicle< BP might be able to put off disputed oil spill damage payments for at least another six months if it can convince U.S. Supreme Court Justice Antonin Scalia of the merit in its allegation that some claims are bogus.
Scalia has jurisdiction over certain petitions coming from the 5th U.S. Circuit Court of Appeals in New Orleans, which recently ruled on the spill claims issue. Legal experts said in interviews with the Chronicle on Thursday that his decision will depend on how much weight he gives competing factors.
The London oil company asked the Supreme Court on Wednesday to reinstate an injunction that had frozen most payouts under a class action settlement with businesses damaged by the economic fallout of the 2010 Gulf of Mexico spill.
The company said business economic loss payments should be suspended until the high court considers BP's contention that some businesses that can't prove financial losses from the spill are fabricating claims to fleece the multibillion-dollar settlement.
BP reached the accord in 2012 with attorneys for thousands of individuals and businesses along the Gulf Coast.
Last week the 5th Circuit denied BP a rehearing on the claims matter, already considered by a three-judge panel of the court.
BP argues that claims administrator Patrick Juneau, a Louisiana lawyer, has misinterpreted the settlement in allowing payments to claimants who cannot prove they were affected by the oil spill.
The 5th Circuit held, however, that BP agreed to the settlement, which only requires claimants to show they lived in certain geographic zones before and after the spill, and not that they directly link damages to the accident.
The appeals court also lifted a district court's ruling that had allowed BP to withhold payments while its allegation about false claims wound through the legal system.
BP wants the Supreme Court to reinstate the payment suspension.
Otherwise, BP spokesman Geoff Morell said in an emailed statement late Wednesday, "hundreds of millions of dollars could be irretrievably scattered to claimants that suffered no injury traceable to the spill."
Blaine LeCesne, a Loyola University law professor who has followed the case, said it is possible Scalia will reinstate the stay based on BP's contention that it won't be able to retrieve payments that ultimately may be deemed inappropriate.
But LeCesne believes it's more likely that Scalia - part of the Supreme Court's conservative wing - will side with the 5th Circuit, one of the most conservative federal appeals courts.
''You have a very conservative 5th Circuit that is very aligned with the majority of the Supreme Court," LeCesne said. "It would be different if it came from the 9th Circuit, where you have a court more heavily weighted toward liberals."
LeCesne said Scalia also will have to consider that some legitimate claims payments are being withheld while BP litigates its position that some aren't legitimate.
Carl Tobias, a law professor at the University of Richmond who also has followed the legal fallout from the Gulf oil spill, noted that the business claims issue is just one facet of a mountain of litigation arising from the disaster.
He said if the high court is inclined to review the spill case, it probably would consider all of it at once and not just the settlement dispute.
If Scalia does restore the injunction as BP requests, it could be half a year before the Supreme Court decides whether to take up the case. The court, Tobias said, gets 8,000 to 9,000 petitions each year.
Juneau, the claims administrator, said in an emailed statement Thursday that his office will resume processing the payouts to businesses on Monday.
But he said many of the business claims will take longer to process than they once would have, because of new court-ordered accounting analysis.
BP says on its Gulf spill website it has tracked $12 million in reported cases of fraud, but the sum of business economic loss claims mean much more to BP than that. Payouts to those businesses make up $2.1 billion of the $3.9 billion it has paid so far to oil spill claimants under the 2012 settlement.
Before it reached a settlement, BP had paid $6 billion from a $20 billion claim fund it put in place after the oil spill. XXX - End of Story<3D>