BP Acted With Gross Negligence in Spill, Plaintiffs Say

Lawyers suing BP Plc (BP/) asked a federal judge in New Orleans to find that the company and its contractors acted with gross negligence in the April 2010 blowout of the Macondo well and the subsequent Gulf of Mexico oil spill.

U.S. District Judge Carl Barbier will determine whether the London-based company or its contractors, Transocean Ltd. (RIG) and Halliburton Co. (HAL), acted with willful or wanton misconduct or reckless indifference, the legal requirement for establishing gross negligence. A ruling against BP could subject it to billions of dollars more in damages.

Barbier set a deadline for today for BP and other parties to file proposed findings of fact and conclusions of law, two months after a trial on fault ended in federal court in New Orleans. Lawyers for BP, Vernier, Switzerland-based Transocean and Houston-based Halliburton are also scheduled to file today.

“BP’s employees engaged in willful and wanton conduct and such willful and wanton conduct was a substantial contributing cause of the blowout, explosion, fire, and initiation of the discharge of oil,” lawyers for the private party plaintiffs and the states of Louisiana and Alabama said in court papers today.

‘Corporate Policy’

This conduct by BP employees “was the result of corporate policy and/or was otherwise known to, approved by, and/or ratified by corporate officials with policymaking authority,” they said. The plaintiffs lodged identical claims against Transocean and Halliburton.

A finding by Barbier that BP acted with gross negligence increases the company’s potential maximum fine for violations of the federal Clean Water Act to $17 billion and leaves it vulnerable to unspecified punitive damages by claimants who weren’t part of the $8.5 billion settlement BP reached with most private-party plaintiffs last year.

Transocean, owner of the Deepwater Horizon drilling rig, and Halliburton, which provided cementing services for the project, could be held liable for punitive damages for all plaintiffs if the companies are found to have handled their duties in a grossly negligent manner.

The contractors aren’t facing compensatory damages, after Barbier ruled last year that the project contract required BP to indemnify them from such costs.

The case is In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, 10-md-02179, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporter on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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