Gulf Coast Claims Facility denies claims for ‘loss of income’

Only 30% of claims filed for lost income due to the BP oil spill in the Gulf Coast have been paid out at an average of “$16,000 per claimant. But according to the US department of health and human services, the 2009 poverty threshold for a family of three was $18,310.”

Attorney Kenneth Feinberg’s Washington-based firm, Feinberg Rozen, has been paid $850,000 a month by BP to administer a $20bn compensation fund and claims process for Gulf residents and fishermen affected by the Deepwater Horizon explosion last April.

The Gulf Coast Claims Facility (GCCF), which Feinberg manages, was set up after negotiations between BP and the Obama administration, but over recent months there has been growing concern among the Coast’s residents that Feinberg is limiting compensation funds to claimants in order to decrease BP’s liability.

Late last month, Feinberg told Bloomberg Television that he anticipates that about half of the $20bn fund should be enough to cover claims for economic losses.

“It remains to be seen, but I would hope that half that money would be more than enough to pay all the claims,” he said.

BP has spent record numbers on advertising, more than $93 million last summer, promising to stay until they ‘make it right’.

Claims are only being paid subject to restrictions that may be illegal.

• Final settlements for all present and future damages that require the claimant to agree not to seek future compensation or sue anyone involved in last year’s oil spill.
• Smaller interim claims that do not require a lawsuit waiver.
• Quick payments of $5,000 for individuals or $25,000 for businesses that require a lawsuit waiver but, unlike final or interim payments, do not call for financial documentation. Only those approved last year for emergency claims can take a quick payment.

…under the Oil Pollution Act (OPA) of 1990, a victim of the BP oil spill must first present a claim for damages to BP/GCCF and wait 90 days. If he or she is not paid, or accepts a lesser amount, that does not preclude the victim from pursuing future compensation. In addition, the GCCF/Feinberg requirement that a claimant sign a general release of all rights and claims is contrary to the OPA.

Businesses are closing and many homes are in foreclosure and despite the compensation fund setup it is believed that a lawsuit to recover damages from BP is inevitable.

[photo Erika Blumenfeld]