http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Oil/8222228
BP Atlantis suit may set tone for US Macondo litigation
New York (Platts)–24Nov2010/1226 pm EST/1726 GMT
Hundreds of lawsuits were filed in reaction to the Macondo well blowout and subsequent oil spill in the US Gulf of Mexico earlier this year, but legal experts say one of the most important legal actions that will affect those suits was filed almost exactly a year before the disaster.
In that case, Kenneth Abbott, a whistle-blower, filed suit against BP on behalf of the federal government alleging fraud in the company’s certificate of safe operation and sound equipment for its Atlantis development, also in the Gulf of Mexico. The case is being heard in US District Court for the Southern District of Texas in Houston before Judge Kenneth Hoyt.
At the close of business November 23, both sides were anticipating the US attorney’s office to file an amicus brief, but the office could not confirm if that had taken place.
“If BP is found to have committed fraud, that would establish a pattern of behavior predating Macondo,” said one attorney familiar with the case. “That could influence all the other litigation arising out of the [Deepwater Horizon] explosion and spill.”
On November 9, BP moved to have the case dismissed; Abbott replied the next day, and the US brief is in support of Abbott. Sources with knowledge of the proceedings say both Abbott and BP will have a week to reply to the US amicus filing, then the judge will consider the motion to dismiss.
If that is denied, a jury trial will proceed, with the discovery process running from April through September 2011 and arguments to begin in November.
Some sense of how major other Macondo-related litigation will play out is also coming into focus. The third pre-trial procedural hearing in the consolidated damage and injury cases took place November 19 in US District Court for the Eastern District of Louisiana before Judge Carl Barbier in New Orleans.
Counsel for the Department of Justice reported that the forensic testing on the failed blowout preventer had begun. The testing was scheduled to be completed in January, with a report due in March. Attorneys for some plaintiffs argued that certain information disclosed to the Gulf Coast Claims Facility was protected from discovery in the litigation. The judge instructed the two sides to meet separately and try to come to an agreement. The next pre-trial hearing is scheduled for December 17.
The other big group of consolidated cases, those involving shareholder actions, has yet to get under way. Sources familiar with the action before Judge Keith Ellison in US District Court for the Southern District of Texas in Houston say that remanded cases continue to trickle in, but that the judge is hopeful of setting a schedule before the end of the year.
Another pair of important cases is being heard before two separate judges in Houston, both involving Anadarko Petroleum seeking to invoke force majeure to cancel contracts for offshore drilling rigs, one with Diamond Offshore and one with Noble Energy.
A scheduling hearing took place before Judge Gabrielle McDonald November 19 in the Noble case. Expert reports are due by June 2011 with discovery to be completed in August and arguments to begin in September.
The two sides reported that they are both agreeable to mediation, and are in discussions, but nothing about the trial schedule has been changed so far. Attorneys indicate the Diamond Offshore case is not quite as amicable, with Diamond moving for dismissal and Anadarko countering. On November 9, Judge Gray Miller converted the motion to dismiss to a motion for summary judgment, and will make a ruling on that January 10. –Gregory DL Morris, newsdesk@platts.com
Similar stories appear in Oilgram News. See more information at http://www.platts.com/Products/oilgramnews
Special thanks to Dave Curtis