OIL SPILL - Let the Litigations Begin

"Hearing into Gulf lawsuits opens in New Orleans" by Tom Hals, Reuters 9/16/2010

A federal judge began on Thursday sorting through hundreds of lawsuits resulting from the oil spill in the Gulf of Mexico as shrimpers, restaurateurs and others pressed their cases against BP Plc and its partners.

Most of the cases were sent from around the United States last month to District Judge Carl Barbier in New Orleans. He will oversee what is expected to be among the costliest and most complex litigation in U.S. history.

Over 400 people packed the courtroom and two overflow rooms for the hearing, court security said, to hear Barbier talk about the types of legal proceedings in play, including potential civil and criminal lawsuits from the U.S. Department of Justice.

"One of the tasks we will have will be how to organize and structure and coordinate all the related things going on," Barbier said.

The April explosion of a rig called the Deepwater Horizon led to a disastrous oil spill in the Gulf of Mexico, forcing a halt to commercial fishing and closing beaches.

The two sides went to court on Thursday having agreed to break the lawsuits into bundles, such as lawsuits by injured rig workers and claims by businesses.

Barbier faces the task of stitching together widely divergent interests, including those of the companies involved.

BP has set up a $20 billion fund to pay claims stemming from the spill, and hired the Obama administration's former executive pay czar, Kenneth Feinberg, to administer it.

Those hurt by the spill have urged the court to move to trial as quickly as possible. They want BP and its co-defendants, including Transocean Ltd and Halliburton Co, to turn over evidence such as contracts and e-mails in the coming weeks.

A group of attorneys from Texas who represent injured rig workers has broken away from the other plaintiffs and wants the court to move even faster.

The defendants have argued that people who lost income or business from the spill cannot sue until they give BP's fund a chance to pay their claims.

The U.S. government has asked that any lawsuits it brings be hived off from the rest, but environmentalists want those lawsuits grouped with theirs.

In addition to the tactical issues, values must be set on claims.

The case in U.S. District Court, Eastern District of Louisiana is In re Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico April 20, 2010, No. 10-MDL-2179.