- Case Type:
- Case Status:
- Reversed and Remanded
- No. 18-30268 (consolidated with 18-30269, 18-30270, 18-30271, 18-30281) (5th Circuit, Apr 18,2019) Published
- In non-bankruptcy case related to BP Deepwater Horizon oil spill claimants, 5th Circuit reversed and remanded ruling of U.S. District Court (E.D. La.)., ruling that district court applied improper definition of "failed business" under defined terms and methodology for determining claim payment set forth in mass tort claimant settlement agreement. Fifth Circuit reviewed district court's ruling de novo because review was on question of law.
- Procedural context:
- Under class action settlement, claimants could obtain review by district court of Settlement Program's determination of claim amount. Claimant sought discretionary review by US District Court (ED La.). District Court granted review of claimant's five claims and affirmed Settlement Program's determination. Claimant appealed to 5th Circuit.
- Following the Deepwater Horizon oil spill in 2010, BP negotiated and agreed to a Settlement Agreement with a proposed class of individuals and entities. The Settlement Agreement created a framework whereby class members could submit claims to the Claims Administrator and receive payment for approved claims. Under the Settlement Agreement, there were two frameworks for calculating the compensation available to businesses that suffered economic losses resulting from the oil spill. Class members could submit claims under the Business Economic Loss (“BEL”) framework or, where applicable, the Failed Business Economic Loss (“FBEL”) framework. Claimant JME Management, Inc. (JME)—a vacation rental business affected by the 2010 BP oil spill—filed five claims for compensation with the Settlement Program. The Settlement Program determined that JME was a “failed business” under the meaning of the Settlement Agreement and calculated JME’s compensation according to the FBEL framework. JME disputed the claim determination and sought review by the Settlement Program's Appeal Panel. The Appeal Panel affirmed. JME sought discretionary review by the US District Court, under process approved within Settlement Agreement. The district court granted discretionary review and affirmed claim determination by Settlement Program.
- Reavley, Elrod, Willett
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