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BP Rejects Claims for Drill-Ban Losses, Cleanup-Boat Damages

BP Plc said it isn’t responsible for damages to boats that participated in its oil-spill cleanup program or for the losses of Gulf Coast businesses idled by the U.S. deep-water drilling moratorium.

The U.S. Oil Pollution Act, which requires companies to compensate people and businesses harmed by an offshore spill, makes clear that liability is “limited to damages directly caused by a covered oil spill and that indirect or derivative losses are not compensable,” BP said in papers filed yesterday in federal court in New Orleans.

BP’s filing came in response to to post-spill claims included among 350 consolidated lawsuits by thousands of businesses and individuals who allege harm from the more than 4.1 million barrels of oil that gushed from BP’s damaged subsea well last year. London-based BP created a $20 billion fund, administered by Kenneth Feinberg, to repay losses caused by the disaster.

The incident, the worst offshore spill in U.S. history, led the Obama Administration to temporarily suspend deep-water drilling in the Gulf, and led BP to hire thousands of recreational and fishing boats to assist in the cleanup. BP said the U.S. Coast Guard has already determined that losses tied to the moratorium aren’t covered under the Oil Pollution Act.

Premature Claims

BP also claims a lawsuit by Louisiana over spill-related losses is premature because the state should be required to present its losses to Feinberg first.

“To date, 155 government entities have submitted almost 800 OPA claims directly to BP, and BP has paid over $1.25 billion to government claimants -- almost $580 million to state and local governments and the remainder to the U.S. Coast Guard,” the company said in the filing.

“As Louisiana is well aware from meetings with BP, BP stands ready to consider Louisiana’s OPA claims once Louisiana complies with its OPA obligations and presents them to BP,” the company said.

In March, hundreds of boat owners and contractors who participated in cleaning up the BP spill filed a master complaint seeking compensation for unpaid wages, vessel damage and physical injuries from contact with the spilled oil or chemical dispersants used to break up the oil. BP yesterday asked the federal court in New Orleans overseeing spill suits to dismiss claims by these plaintiffs under the Oil Pollution Act.

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).

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