The BP oil spill victims compensation fund, which was administered by Kenneth R. Feinberg, proves that a claims program like the GCCF does not provide a much-needed alternative to conventional mass tort litigation.
On May 26, 2015, Plaintiffs Selmer M. Salvesen, Pinellas Marine Salvage, Inc., John Mavrogiannis, and Andrew J. Ditch filed their Motion to Nullify Every GCCF Release and Covenant Not to Sue.
The following is an excerpt from the memorandum of law which the plaintiffs filed in support of their Motion to Nullify.
A Feinberg-administered victims compensation program like the GCCF ought to be viewed with a significant degree of concern. The precedent established by the JPML and the MDL 2179 Court is clear:
A “Responsible Party” under OPA may now enter into a contract with a politically well-
connected third party “Fund Administrator,” e.g., Kenneth R. Feinberg and Feinberg Rozen, LLP, d/b/a GCCF. This third party “Administrator / Straw Person,” directly and excessively compensated by the party responsible for the oil spill incident, may totally disregard OPA, operate the claims process of the responsible party as fraudulently and negligently as it desires for the sole purpose of limiting the liability of, and providing closure to, the responsible party, and the third party “Administrator / Straw Person” shall never be held accountable for its tortious acts.
Kenneth R. Feinberg, in his never-ending effort to promote himself and Feinberg-administered claims programs, intentionally misled the U.S. Supreme Court.
On September 4, 2014, Feinberg filed an amicus brief (No. 14-123) with the U.S. Supreme Court in support of BP. Two statements made by Feinberg in his brief are instructive.
Statement No. 1: “Kenneth R. Feinberg was selected by Executive Branch officials.”
“Amicus Kenneth R. Feinberg was selected by Executive Branch officials to help design,
implement, and administer two successful alternatives to the conventional tort litigation system [9/11 Fund and BP Oil Spill Fund].” Plaintiffs point out that this is true for the 9/11 fund, not for the BP oil spill fund. It is important to note that Feinberg was "selected" by BP and merely presented at a June 2010 White House press conference. This Honorable Court has recognized that “Mr. Feinberg was appointed by BP, without input from opposing claimants or the Plaintiffs’ Steering Committee (“PSC”), and without an order from the Court. It has been suggested by several non-PSC attorneys that Mr. Feinberg is a Presidential appointee and therefore a part of the Executive Branch. There is no evidence of such an appointment to support this contention.”
Plaintiffs understand Kenneth R. Feinberg. “Selected by Executive Branch officials…….”
does sound a great deal more impressive than “hired by Defendant BP to limit its liability.” However, Plaintiffs do not agree that self-promotion justifies Feinberg intentionally misleading the U.S. Supreme Court.
Statement No. 2: “Administrative claims programs like the 9/11 and Deepwater Horizon funds provide much-needed alternatives to conventional mass tort litigation.”
Feinberg’s amicus brief is replete with statements which are intended to support this statement. The following are a few examples.
(a) The Gulf Coast Claims Facility program “demonstrates that principled, transparent, and effectively administered claims programs can fairly compensate victims, conserve judicial resources, and efficiently resolve claims without the uncertainty and cost associated with conventional litigation.”
(b) “Mr. Feinberg offers a unique perspective on effective alternatives to mass tort litigation - and has an interest in the continued viability of those alternatives. The September 11th Victim Compensation Fund and the Gulf Coast Claims Facility administered by Mr. Feinberg demonstrate that when designed and implemented appropriately, these alternatives to mass tort litigation can secure fair compensation for eligible victims, avoid delay, and alleviate crowded court dockets.”
(c) “The Court should therefore grant the petition to ensure that a key alternative to the conventional tort system remains viable for the fair, efficient, and expeditious compensation of injured victims.”
(d) “While these programs [the 9/11 Victim Compensation Fund and the GCCF Fund] have been extraordinarily effective, by any measure, at efficiently and fairly compensating individual victims, the Fifth Circuit’s decisions in this case affecting the causation standard, if permitted to stand, threaten to make these sorely needed alternatives to mass tort litigation unlikely to be replicated.”
(e) “The numbers confirm the success of both the 9/11 Fund and the Gulf Coast Claims Facility. An overwhelming percentage of eligible claimants chose to file a claim and receive compensation from the funds rather than litigate in court. And both programs worked precisely as intended. If a claimant could demonstrate causation - i.e., that the death, physical injury, or business loss was caused, respectively, by the terrorist attacks or the oil rig explosion - payment was authorized without having to resort to litigation. Instead of waiting years for an uncertain litigation outcome, hundreds of thousands of claimants received prompt, certain, and fair compensation with relatively minimal delay and cost.”
(f) “The success of the 9/11 Fund and the Gulf Coast Claims Facility demonstrate that fair compensation can be efficiently delivered to thousands of eligible victims without the necessity of litigating for years in federal and state courts throughout the Nation.”
These statements are blatantly false and misleading.
The 9/11 victim compensation fund was established because Congress was concerned that conventional mass tort litigation would threaten the financial viability of the Nation’s airline industry. (Feinberg U.S. Supreme Court Amicus Brief, No. 14-123, at 9 (September 4, 2014)). The purpose of this fund, funded entirely by federal taxpayer dollars, was not to compensate victims of the attacks in a prompt and fair manner.
“Victims' Kin Find Fault With Overseer Of 9/11 Fund,” The New York Times, November 13, 2002, available at http://www.nytimes.com/... (last visited May 24, 2015). and
“7 Families Sue Administrator Of 9/11 Fund,” The New York Times, January 27, 2003, available at http://www.nytimes.com/... (last visited May 24, 2015).
Similarly, the purpose of the GCCF was not to ensure that victims of the BP oil spill received prompt, certain, and fair compensation with relatively minimal delay and cost. The GCCF status report numbers confirm that the principal purpose of the GCCF, funded entirely by BP, was to limit BP’s liability.
There is no doubt that the statements made by Feinberg in his amicus brief are false and misleading. However, this is not the first time that Feinberg has played so fast and loose with the court.
“Ken Feinberg’s Retracted Affidavit Cited in Appeals Ruling Favoring Fen-Phen Lawyers,” ABA Journal, February 18, 2011, available at http://www.abajournal.com/... (last visited May 24, 2015). and
“An Expert’s Change of Mind Can be Shattering,” BullsEye, available at http://documents.jdsupra.com/... (last visited May 24, 2015).
Kenneth R. Feinberg, in his never-ending effort to promote himself and Feinberg-administered claims programs, continues to use the media to mislead the public.
In a recent interview with investigative reporter David Hammer of WWLTV, Feinberg states,
"I've never seen any evidence of duress." "I can either get a great deal more money with documentation, or I don't even need documentation and I can get a check in the next couple of weeks or months. I'm not surprised at all, human nature being what it is. I see no duress. I see each fisherman making the decision of what's best for the fisherman."
“…when it comes to compensating innocent people, I think that what we [Feinberg Rozen, et al.] did and what BP did deserves a great deal of praise."
“BP's oil spill payments: Are they enough?” WWLTV, April 17, 2015, available at http://www.wwltv.com/... and http://www.wwltv.com/... (last visited May 22, 2015).
Plaintiffs respectfully point out to this Honorable Court that duress was an essential element of Kenneth R. Feinberg’s “Delay, Deny, Defend” strategy. Without his unique ability to place BP oil spill victims under duress, Feinberg would not have been able to force economically and emotionally-stressed GCCF claimants to sign a “Release and Covenant Not to Sue” in order to receive a miniscule payment amount for all damages, including future damages, they incur as a result of the BP oil spill.
Plaintiffs respectfully point out to the Court that Feinberg should have said,
“I was never under any financial duress. I think that I deserve a great deal of praise for limiting BP’s liability.”
This Honorable MDL 2179 Court Has an Obligation to “Make Things Right.”
This Honorable Court has an obligation to “Make Things Right” by:
(a) eradicating the Feinberg-administered claims program cancer in MDL 2179; and
(b) preventing the Feinberg-administered claims program cancer from metastasizing to other multidistrict litigation Courts in the U.S.
As noted supra, the ultimate objective of every Feinberg-administered claims program like the GCCF is, and will continue to be, to force as many claimants as possible into signing a “Release and Covenant Not to Sue.”
Kenneth R. Feinberg, who markets himself as the “Master of Disasters,” used coercion, fraudulent inducement, and a “Delay, Deny, Defend” strategy to starve, and ultimately force, BP oil spill victims into signing a “Release and Covenant Not to Sue” in exchange for an inadequate, miniscule payment amount for the damages, including future damages, they incur as a result of the mass tort. Accordingly, the most “speedy and efficient” way to eradicate the Feinberg-administered claims program cancer in MDL 2179 would be to surgically remove the tumor (“nullify every Release and Covenant Not to Sue”).
Plaintiffs respectfully point out to this Honorable Court that “Enough is enough.” Feinberg is not the “Master of Disasters.” Feinberg is a “Master of Deception” and a “Master of Self- Promotion.” Feinberg’s blatantly false and misleading statements to BP oil spill victims, the U.S. Supreme Court, and the general public are reprehensible. If Feinberg is not held accountable, he will continue to play fast and loose with the Courts and continue to mislead the general public and future mass tort victims.
What is life worth? Kenneth R. Feinberg believes, for a few lucky claimants, it is worth $5,000 for an individual and $25,000 for a business. Plaintiffs and Plaintiffs’ Counsel strongly disagree.
A copy of the entire Memorandum of Law is available HERE.
Note: Before you read the comments on this article, I advise you to visit: BP Oil Spill: BP Pays PR Trolls to Threaten Online Critics