Covering The Nation

Sep 14, 2012 9:45 PM

Judge Asked To Toss Claims Spill Hurt BP Brand

NEW ORLEANS (AP) - BP PLC asked a federal judge Friday to dismiss claims by its fuel dealers that the 2010 oil spill in the Gulf of Mexico diminished the value of the BP brand and cost them business.

U.S. District Judge Carl Barbier didn't immediately rule

BP attorney Christopher Landau said claims that BP dealers lost money due to consumer animosity after the spill must be thrown out because they aren't covered by either the Oil Pollution Act of 1990 or general maritime law.

The Oil Pollution Act "doesn't purport to allow recovery for any and all economic losses that someone might allege," Landau said.

Thomas Bleau, a lawyer for BP dealers Tobatex Inc. and M.R.M. Energy Inc., argues that other federal and state laws apply to their claims.

Bleau said bungling by BP corporate executives after the nation's worst offshore spill severely damaged the brand name. Switching brands wasn't an option for the dealers, he added.

"They're locked in for 20 years," he said.

Barbier pressed Bleau to explain how a BP-branded gas station's claim is different than economic damage claims by other types of businesses.

"Because they owe the BP dealers a (contractual) duty. They breached the duty," Bleau said.

Jim Roy, one of the lead plaintiffs' lawyers in the broader litigation against BP over the spill, said it would be premature for Barbier to throw out the dealers' claims.

"Let's wait and let's flesh them out with individual test cases," he said.

All claims by BP dealers are excluded from the company's proposed settlement of billions of dollars of claims by other businesses and individuals who blame the spill for economic damages.

BP also on Friday asked Barbier to dismiss other claims that aren't eligible for compensation through the settlement, including those by Gulf Coast homeowners who claim the spill hurt their property values even though no oil physically touched their property and they haven't sold their homes.

Barbier questioned how these plaintiffs could quantify their losses if they haven't sold their property. He likened their situation to a stock trader whose holdings fluctuate in value.

"Unless you sell, you haven't lost anything," he said. "It's sort of the same thing with real estate."

(Copyright 2012 The Associated Press. All rights reserved.)

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