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BP Wins Bid to Bar Prior Bad Acts From Gulf Oil Spill Trial

BP Plc (BP/) persuaded a judge to bar the introduction of evidence of previous accidents involving the oil company from this month’s trial over fault for the 2010 Gulf of Mexico blast and oil spill.

U.S. District Judge Carl Barbier in New Orleans granted a BP motion blocking the introduction of exhibits pertaining to prior industrial accidents, including the 2005 explosion at BP’s Texas City, Texas, refinery and a 2006 oil spill at its Prudhoe Bay field in Alaska.

The April 2010 Macondo well blowout and explosion killed 11 workers and caused the worst offshore oil spill in U.S. history. The accident spurred hundreds of lawsuits against BP and its partners, including Transocean (RIG) Ltd., the Switzerland-based owner and operator of the Deepwater Horizon drilling rig that exploded, Halliburton Co. (HAL), which provided cementing services for the project, and Anadarko, the owner of 25 percent of the well.

“The prior incidents were all land-based, while the Macondo incident occurred in the Gulf of Mexico,” Barbier said. The circumstances of those accidents were “vastly different,” he said.

In an accompanying decision, Barbier said 2010 congressional testimony by former BP Chief Executive Officer Tony Hayward and Halliburton engineer Jesse Gagliano were potentially admissible as prior inconsistent statements if they conflicted with other trial evidence or as admissions.

Smoke billows from controlled oil burns near the site of the BP Plc Deepwater Horizon oil spill in the Gulf of Mexico off the coast of Louisiana on June 19, 2010. Photo: Derick E. Hingle/Bloomberg Close

Smoke billows from controlled oil burns near the site of the BP Plc Deepwater Horizon... Read More

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Smoke billows from controlled oil burns near the site of the BP Plc Deepwater Horizon oil spill in the Gulf of Mexico off the coast of Louisiana on June 19, 2010. Photo: Derick E. Hingle/Bloomberg

Ellen Moskowitz, a spokeswoman for London-based BP, declined to comment.

Gulf Businesses

Thousands of property owners and businesses on the Gulf claim economic and environmental harm from the spill. The U.S. sued BP, Anadarko (APC) and Transocean in December 2010, alleging violations of federal pollution laws. The coastal states Louisiana, Alabama and Mississippi also sued the companies.

The suits are consolidated before Barbier and a non-jury trial is set to begin on Feb. 27.

BP asked the judge in November to bar the plaintiffs steering committee, which represents the non-government claimants, from using evidence of the prior incidents in the trial over fault for the explosion and sinking of the rig.

BP argued the plaintiffs’ lawyers were trying to introduce the prior accidents to show “bad character” on the part of the company.

Barbier disagreed.

‘Not Valid’

“These are not valid concerns in the context of a non-jury trial,” he wrote. “However, the court is greatly concerned about considerations of ‘‘undue delay, waste of time, and presentation of cumulative evidence.’’’

The judge’s rulings yesterday prevent the evidence from being shown in what he labeled the Phase I trial, which will determine the legal responsibility for the blast as well as the ensuing fire and sinking of the drilling rig.

‘‘It may be that some of this evidence will become more relevant and admissible at a later phase, e.g., if and when the court is required to consider the quantum of punitive damages or the assessment of CWA penalties,’’ Barbier wrote, referring to the Clean Water Act.

‘‘The court indicates the evidence will likely be admissible to establish the basis of expert opinions regarding the process safety that should have been, but was not, in place at Macondo,’’ Steve Herman, a lawyer for the plaintiffs, said in an e-mailed statement reacting to Barbier’s rulings.

The evidence could become relevant and admissible at a later punitive damages phase, the attorney said.

‘Mountain of Evidence’

‘‘There is a mountain of independent evidence to show that BP was irresponsible grossly negligent at Macondo -- and it will be admissible,’’ Herman said.

The Texas City refinery explosion killed 15 workers and injured hundreds. BP pleaded guilty to a violation of the Clean Air Act and paid a $50 million fine.

In his other ruling yesterday, Barbier excluded a March 2007 report on the Texas City accident issued by the U.S. Chemical Safety and Hazard Investigation Board.

That 2005 land accident wasn’t ‘‘substantially similar’’ to the Deepwater Horizon incident, Barbier said. He also blocked admission during Phase I of a report by the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.

The company was also fined $87 million in 2009 by the U.S. Occupational Safety and Health Administration over safety shortfalls at the Texas City refinery. Barbier yesterday barred admission of an OSHA briefing from that incident.

After the Alaska spill, BP pleaded guilty in 2007 to a violation of the Clean Water Act and paid $20 million in penalties after 200,000 gallons of oil from its Prudhoe Bay field flowed into water on Alaska’s North Slope in 2006.

The case is In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporters on this story: Andrew Harris in Chicago at aharris16@bloomberg.net; Allen Johnson Jr. in New Orleans at allenmct@gmail.com.

To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net

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