Supreme Court Rejects BP Challenge; Claimants Need Not Prove Direct Harm; "Gross Negligence" Stands

Legal experts say the U.S. Supreme Court's decision not to hear BP's challenge to its multibillion-dollar oil spill settlement was a predictable end to one of the more contentious chapters of the ongoing disaster litigation. But the setback may not keep BP from appealing to the nation's highest court on future oil spill disputes.

The Monday (Dec. 8) decision upholds lower court rulings that, under the settlement terms, businesses claiming damages from the 2010 Gulf of Mexico oil disaster need not prove direct harm.

BP spent nearly two years challenging that interpretation of the settlement. It argued that the agreement was being misread to allow millions of dollars to go to undeserving businesses. BP originally estimated the settlement would cost it $7.8 billion total. It now estimates it could spend as much as $9.7 billion.

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BP has been actively downsizing in the wake of the 2010 oil spill, which it now estimates will cost it $43 billion not including unpaid business claims payments. Ahead of Monday's ruling, the company said it would accelerate layoffs worldwide amid falling oil prices. BP reported $3 billion in underlying cost profit - which removes the impact of oil prices - for the third quarter, down from $3.7 billion last year. "If they're concerned with their bottom line then throwing more money into litigation may not be the best business decision," Logan said. "The reality is the Supreme Court is not going to take the vast majority of disputes even with the best lawyers teeing them up."

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