BP Plc was sued by New York City pension funds for at least $39 million in investment losses based on claims the oil company failed to disclose the risks and safety issues leading to the 2010 Deepwater Horizon disaster in the Gulf of Mexico.
The company misled investors and attempted to minimize the damage and cost to shareholders after the spill began, according to a complaint unsealed yesterday in federal court in Manhattan. The case was originally filed April 17 by pension funds for city workers, teachers, police officers and firefighters.
The estimated transactional investment losses to city pension beneficiaries caused by BP’s misconduct and fraudulent behavior exceed $39 million, City Comptroller John Liu said in an e-mailed statement yesterday.
“BP failed to disclose to shareowners the serious risks involved in its offshore drilling operation,” Liu said. “After the spill began, it misleadingly attempted to minimize the extent of the damage and the cost to shareowners.”
The April 20, 2010, blowout of BP’s Macondo well and the subsequent explosion sent 4 million barrels of oil into the Gulf. The blast aboard the Deepwater Horizon drilling rig killed 11 workers and set off the largest offshore oil spill in U.S. history.
Last year BP agreed to pay an estimated $8.5 billion to settle lawsuits by most plaintiffs as well as $4 billion to the U.S. government in criminal penalties. The company is also facing claims from plaintiffs who weren’t covered by last year’s settlement and as much as $17 billion in fines over violations of the U.S. Clean Water Act.
Liu said the funds are barred from suing the company under federal securities laws because of a 2012 Supreme Court ruling. The current lawsuit focuses on state law claims to recover losses, he said in the statement.
A consolidated shareholder lawsuit against BP is pending in federal court in Houston.
The New York case is New York City Employees Retirement System v. BP Plc, 13-2551, U.S. District Court, Southern District of New York (Manhattan).