WASHINGTON -- The U.S. Department of Justice has joined the five Gulf states in announcing a settlement to resolve civil claims against BP arising from the April 20, 2010, Macondo well blowout that killed 11 and led to a massive oil spill in the Gulf of Mexico.
This settlement resolves the governments’ civil claims under the Clean Water Act and natural resources damage claims under the Oil Pollution Act, as well as economic damage claims of the five Gulf states and local governments.
Taken together, this resolution of civil claims is worth $20.8 billion, and is the largest settlement with a single entity in the department’s history.
Also, the Deepwater Horizon Trustees Council, made up of representatives of the five Gulf states and four federal agencies, has published a draft damage assessment and restoration plan and a draft environmental impact statement.
“Building on prior actions against BP and its subsidiaries by the Department of Justice, this historic resolution is a strong and fitting response to the worst environmental disaster in American history,” said Attorney General Loretta Lynch. “BP is receiving the punishment it deserves, while also providing critical compensation for the injuries it caused to the environment and the economy of the Gulf region.”
Secretary of Commerce Penny Pritzker added, “With this settlement, federal, state and local governments and the Gulf coast communities will have the resources to make significant progress toward restoring ecosystems, economies, and businesses of the region.”
On Dec. 15, 2010, Attorney General Eric Holder announced a civil lawsuit against BP and several co-defendants, seeking to hold them accountable for the Deepwater Horizon disaster. The federal lawsuit culminated in a three-phase civil trial in which the United States proved, among other things, that the spill was caused by BP’s gross negligence.
Each of the Gulf states--Alabama, Florida, Louisiana, Mississippi and Texas--also filed civil claims against BP relating to the spill, including claims for economic losses and natural resource damages.
Under the terms of a consent decree lodged in federal court in New Orleans, BP must pay the following:
- $5.5 billion federal Clean Water Act penalty, plus interest, 80% of which will go to restoration efforts in the Gulf region pursuant to a Deepwater-specific statute, the RESTORE Act. This is the largest civil penalty in the history of environmental law.
- $8.1 billion in natural resource damages, this includes $1 billion BP already committed to pay for early restoration, for joint use by the federal and state trustees in restoring injured resources. BP will also pay up to an additional $700 million, some of which is in the form of accrued interest, specifically to address any later-discovered natural resource conditions.
- $600 million for other claims, including claims for reimbursement of federal and state natural resource damage assessment costs and other unreimbursed federal expenses and to resolve a False Claims Act investigation due to this incident.
Additionally, BP has entered into separate agreements to pay $4.9 billion to the five Gulf states and up to a total of $1 billion to several hundred local governmental bodies to settle claims for economic damages they have suffered as a result of the spill.
The current settlements are in addition to several earlier criminal and civil settlements of federal government claims concerning the Deepwater Horizon disaster. Among them: On Jan. 29, 2013, BP Exploration & Production Inc. pleaded guilty to illegal conduct leading to and after the 2010 Deepwater Horizon disaster, and was sentenced to pay $4 billion in criminal fines, penalties and restitution, including $2.4 billion for natural resource restoration.
London-based BP is a global producer, manufacturer and marketer of oil, gas, chemicals and renewable energy sources. With U.S. headquarters in La Palma, Calif. (West), and Warrenville, Ill. (East), BP markets more than 15 billion gallons of gasoline every year to U.S. consumers through more than 11,000 BP- and ARCO-branded retail outlets and supplies more than four billion gallons of fuel annually to fleets, industrial users, auto and truck manufacturers, railroads and utilities.
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