At this point in the BP oil spill “game” - it certainly may not be called “litigation” (at least not in the U.S.) - the strategy is quite simple: merely continue to misdirect the attention of the BP oil spill victims until all potential claims against BP and Kenneth R. Feinberg, et al. are time-barred pursuant to any conceivably applicable statute of limitations.
Black's Law Dictionary defines a "statute of limitations" as follows:
Statutes of the federal government and various states setting maximum time periods during which certain actions can be brought or rights enforced. After the time period set out in the applicable statute of limitations has run, no legal action can be brought regardless of whether any cause of action ever existed.
In federal question cases, the federal court will apply the specific statute of limitations period established by the federal statute under which the plaintiff is seeking relief. Federal courts that are hearing a controversy based on diversity of citizenship of the parties must apply the applicable state law of the forum state.
Two Litigation Avenues Are Currently Available to BP Oil Spill Victims:
BP and Feinberg, et al.
BP oil spill victims may bring a lawsuit against BP in federal court under the Oil Pollution Act of 1990 (“OPA”). OPA is a strict liability statute. In order to recover damages, a claimant merely needs to show that his or her damages “resulted from” the oil spill. OPA provides,
“Each responsible party for a vessel or a facility from which oil is discharged, or which poses the substantial threat of a discharge of oil, into or upon the navigable waters or adjoining shorelines or the exclusive economic zone is liable for the removal costs and damages that result from such incident.” 33 U.S.C. § 2702(a).
The damages referred to in 33 U.S.C. § 2702(a) include, but are not limited to:
"Damages equal to the loss of profits or impairment of earning capacity due to the injury, destruction, or loss of real property, personal property, or natural resources, which shall be recoverable by any claimant.” 33 U.S.C. § 2702(b)(2)(E) (Emphasis added).
Under OPA, claims for damages must be presented first to the responsible party. 33 U.S.C. § 2713(a). In the event that a claim for damages is not paid by the responsible party within 90 days, the claimant may elect to commence an action in court against the responsible party or to present the claim to the Oil Spill Liability Trust Fund. 33 U.S.C. § 2713(c).
Under OPA, an action for damages shall be barred unless the action is brought within three years after the date on which the loss and the connection of the loss with the discharge in question are reasonably discoverable with the exercise of due care. 33 U.S.C. § 2717(f)(1)(A).
BP oil spill victims may also bring a lawsuit in State court against Kenneth R. Feinberg, et al. In this lawsuit, asserting claims for gross negligence, negligence, negligence per se, fraud, fraudulent inducement, promissory estoppel, and unjust enrichment under State law, brought against Kenneth R. Feinberg, et al., the complaint would allege, in part, that Defendants Kenneth R. Feinberg, Feinberg Rozen, LLP, d/b/a Gulf Coast Claims Facility (“GCCF”) misled the plaintiffs by employing a “Delay, Deny, Defend” strategy against them. This strategy, commonly used by unscrupulous insurance companies, is as follows: “Delay payment, starve claimant, and then offer the economically and emotionally-stressed claimant a miniscule percent of all damages to which the claimant is entitled. If the financially ruined claimant rejects the settlement offer, he or she may sue.” In sum, the plaintiffs allege that BP is responsible for the oil spill incident; Feinberg, et al. (independent contractors), via employment of their "Delay, Deny, Defend" strategy, are responsible for not compensating and thereby financially ruining the plaintiffs.
Under State law, the statute of limitations varies from state to state for the claims which may potentially be asserted against Feinberg, et al.
Tolling of Statute of Limitations
In diversity lawsuits, a federal court is ordinarily bound to look to the choice of law rules of the state in which it sits to determine whether the state courts of that state would apply their own state’s statute of limitations or the statute of limitations of some other state.
In MDL 2179, the majority of cases were filed in, or removed to, federal courts and transferred to the MDL 2179 court by the Judicial Panel on Multidistrict Litigation. See 28 U.S.C. § 1407(a). In these cases, the MDL 2179 court must apply the law of the transferor forum, that is, the law of the state in which the action was filed, including the transferor forum’s choice-of-law rules. See Ferens v. John Deere Co., 494 U.S. 516, 524 (1990).
While the precise limits of the MDL court’s authority over such cases is currently subject to debate, it is clear that the court cannot try these cases, but rather must remand them to the transferor forum when pretrial discovery is complete. See Lexecon, Inc. v. Miberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998).
The Supreme Court has held that “the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action.” Federal courts have uniformly held that this rule operates only with respect to the first class action filed for a specific controversy.
The Supreme Court has also held that in diversity cases, where state law provides the rules of decision, “a federal court should apply not only state statutes of limitation but also any accompanying tolling rules.” Accordingly, the MDL 2179 Court must examine each state’s tolling law to determine whether or not the states recognize class action tolling. If in fact a state does recognize class action tolling, the MDL 2179 Court must determine which class actions, if any, tolled the respective plaintiff’s claims.
Moreover, the discovery rule in some states operates to toll the statute of limitations when “there is fraudulent concealment or a misrepresentation by the defendant of his role in causing the plaintiff’s injuries.”
Victims of GCCF’s “Release and Covenant Not to Sue”
Approximately 200,000 BP oil spill victims are being illegally excluded from the Deepwater Horizon E&PD class action settlement. These victims are being led to believe by BP, the PSC, and the DHCC that if they signed a GCCF “Release and Covenant Not to Sue,” they are not able to recover for the true value of their damages. This is not accurate.
The validity of a GCCF release is not in question until a releasing plaintiff files a lawsuit on its substantive claims and BP or another defendant raises the release as a defense. See, e.g., Fed. R. Civ. P. 8(c)(1) (release is an affirmative defense); Tyler v. Cedar Hill Indep. Sch. Dist., 426 Fed. Appx. 306, 308 (5th Cir. 2011) (per curiam) (release of federal claims are affirmative defenses); Copeland v. Wasserstein, Perella & Co., 278 F.3d 472, 480 (5th Cir. 2002) (same as to Louisiana law claims).
Victims of GCCF’s “Release and Covenant Not to Sue” should consider immediately filing a lawsuit against Feinberg, et al. As noted above, after the time period set out in the applicable statute of limitations has run, no legal action can be brought regardless of whether any cause of action ever existed.
Victims Held Hostage by Class Action Settlements
In April, 2010, immediately following the BP oil spill, teams of class action lawyers from across the country descended on the Gulf Coast to sign-up unwary BP oil spill victims as class members for potential class action lawsuits. Some law firms are “representing” thousands of victims in these yet-to-be certified class actions. The vast majority of these class action hostages most probably never filed a claim with the GCCF. Their only litigation avenue is to file a lawsuit against BP under OPA.
Under OPA, (a) “an action for damages shall be barred unless the action is brought within three years after the date on which the loss and the connection of the loss with the discharge in question are reasonably discoverable with the exercise of due care;” and (b) “claims for damages must be presented first to the responsible party. In the event that a claim for damages is not paid by the responsible party within 90 days, the claimant may elect to commence an action in court against the responsible party.” The BP oil spill commenced on April 22, 2010. Accordingly, in order to safely fulfill the 90-day presentment requirement under OPA, a claimant should file a claim with BP prior to January 22, 2013.
As explained above, “the commencement of a class action suspends the applicable statute of limitations” and the discovery rule in some states operates to toll the statute of limitations when “there is fraudulent concealment or a misrepresentation by the defendant of his role in causing the plaintiff’s injuries.”
However, given that the MDL 2179 Court has chosen to ignore OPA, the Lexecon rule, the Fifth Circuit’s holding in Lloyds Leasing, the fact that the proposed class settlements are not “fair, reasonable, and adequate” and “free of collusion,” and the excessive compensation paid to members of the PSC, there is no logical reason to assume that the MDL 2179 Court will toll the three-year statute of limitations under OPA.
If you believe that ligation is not necessary in this case, click here for an overview of the latest DHCC program statistics.
Click here to read about the "fairness" hearing.
Click here to understand why plaintiffs oppose class action lawsuits in MDL 2179.
Click here to read why class action lawsuits are not in the best interests of BP oil spill victims.