Feinberg Defends Legal System, Rejecting U.S. Chamber’s Campaign

Kenneth R. Feinberg, the attorney running BP Plc’s fund for victims of the Gulf oil spill, told the U.S. Chamber of Commerce not to use his efforts as an argument to revamp the U.S. legal system.

“I’m a lawyer,” Feinberg said today in a speech in Washington, responding to the business organization’s campaign to limit litigation. “I happen to believe, in the run-of-the- mill, everyday life in America, the legal system works pretty well.”

The Chamber’s Institute for Legal Reform, which sponsored Feinberg’s appearance, is working to limit damage suits against corporations. Thomas Donohue, president of the Chamber, the largest U.S. business lobby, said today in introducing Feinberg that he has demonstrated that arbitration is often a better course than a lawsuit.

Feinberg, who is drawing from a $20 billion account set up by BP and earlier determined compensation for victims of the Sept. 11 terrorist attacks, said such claims funds are rare and won’t work when the source of funding isn’t clear.

Those affected by BP’s oil spill, the largest in the U.S., retain their rights to sue the company unless they accept a final settlement from Feinberg’s fund.

The pace of litigation in the U.S. probably will increase, led by cases tied to the federal health-care law, Donohue said.

The threats “have never been greater,” he said.

Asbestos Cases

Feinberg said funds to pay victims of events are difficult to establish because in most instances the responsible party to make payments isn’t clear. Congress has periodically debated during the past 25 years setting up a program to compensate victims of asbestos, Feinberg said.

A claims fund wasn’t created because defendants, including insurance companies and manufacturers that used asbestos, couldn’t agree on contributions into the account, he said.

“Don’t blame the trial bar” for the failure of asbestos legislation, Feinberg said.

As administrator for the Gulf Coast Claims Facility, Feinberg said he faced a difficult task of determining long-term effects of the spill as the Nov. 23 deadline approaches for filing emergency claims.

Feinberg said he was gathering information from scientists to estimate potential lasting damage from the spill.

Claimants waive their rights to sue BP in accepting final payments determined by Feinberg. Such rights are retained when accepting emergency or interim payments during the three years the claims facility will operate, Feinberg said.

To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net;

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net.

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