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BP Like Fish in a Barrel 

Snafu exposes the oil giant to all kinds of litigation, a fact not lost on Louisiana lawmakers

click to enlarge Oysters produced in beds off Louisiana's coast are being prepared for analysis to ensure they are safe to harvest. - PHOTO COURTESY OF THE LOUISIANA DEPARTMENT OF WILDLIFE AND FISHERIES
  • Photo courtesy of the Louisiana Department of Wildlife and Fisheries
  • Oysters produced in beds off Louisiana's coast are being prepared for analysis to ensure they are safe to harvest.

Ginger Sawyer, vice president of the Louisiana Association of Business and Industry (LABI), couldn't have said it better last week when lawmakers on the Senate Judiciary A Committee waded into the troubled legal waters surrounding the oil gusher in the Gulf of Mexico. "Right now, BP's like fish in a barrel," Sawyer said.

  Every trial lawyer along the Gulf Coast can attest to that. As of last week, there were nearly 80 related cases pending in courts stretching from Florida through Louisiana and into Texas. The U.S. District Court in New Orleans accounts for about half of that tally. Some firms are advertising their services to bring in clients; everyone from homeowners to grieving family members, from commercial fishermen to restaurateurs and others are responding.

  A number of high-profile attorneys from the impacted states have formed the Gulf Oil Spill Litigation Group to take a more holistic approach, grouping together shrimpers and processors with businessmen and residents in their quest for corporate accountability — and large legal fees. The defendants don't make for a short list either. So far they include BP, which owns the oil well that exploded; Transocean Offshore, which leases the Deepwater Horizon rig to BP; Halliburton Energy Services, which was engaged in cementing operations; and Cameron International, which supplied the controversial blowout preventer valves that failed to activate.

  Plaintiff lawyers allege in various pleadings that the incident was the result of negligence by BP and the other corporations involved in the rig's operations. Again, like fish in a barrel. "They failed to take appropriate measures to prevent damage to the Gulf Coast's marine and coastal environments," says plaintiff lawyer Randy Smith of New Orleans.

  Another New Orleans attorney participating in the plaintiffs' group, Dawn M. Barrios, says the litigation will last a while — at least as long as the crude pollutes the Gulf Coast. "The oil spill and resulting contamination threaten the livelihoods of thousands of individuals and businesses that cannot use the Gulf of Mexico and Louisiana's shore to work and to earn a living," he said.

  These are all things that Sawyer, as well as many other players at the State Capitol, already knows. When Sawyer dropped her wisdom on the committee last week, it was part of her testimony on legislation that would allow Louisiana's attorney general to execute contingency-fee contracts to hire private attorneys to help the state handle its own potential claims against the rig defendants. It's no surprise, given recent headlines, that the BP catastrophe became a topic of conversation.

  Senate President Joel Chaisson II, D-Destrehan, said he initially started investigating how states such as Texas and Alabama handle contract help on legal matters. He discovered that most states offer contingency fees to private attorneys, he said, and that the better programs had strict guidelines and loads of transparency. But he never envisioned Senate Bill 731 as a mechanism to help Louisiana litigate its way through a disaster like the one it now faces. "Then lo and behold, here comes BP," Chaisson said.

  Currently, the state can pay private attorneys by the hour for their services. Chaisson's bill would give them a cut of the funds recovered in a particular case — much like plaintiff attorneys do in standard car-accident cases or other personal injury claims. It's called a contingency fee because the plaintiff attorneys don't get paid unless their clients — in this case, the state — actually recover money damages from the defendants. Chaisson said BP has billions of dollars to work with, while Louisiana is facing a $3 billion budget shortfall over the next two years. "It's going to be the largest litigation this country has ever seen, and we ought to have the same tool as [our neighboring states]," he said.

click to enlarge Globs of oil washed ashore last Thursday at Elmer's Island, a wildlife refusge owned by the state of Louisiana. - PHOTO COURTESY OF THE LOUISIANA DEPARTMENT OF HEALTH AND HOSPITALS
  • Photo courtesy of the Louisiana Department of Health and Hospitals
  • Globs of oil washed ashore last Thursday at Elmer's Island, a wildlife refusge owned by the state of Louisiana.

  Sen. Julie Quinn, R-Metairie, the committee chair, helped steer the bill to its initial Senate floor hearing and echoed Chaisson's argument. "If we can't litigate the case against BP and Texas does, Florida does and Alabama does, they get millions and we would get how much?"

  Which brings us back to BP in the barrel, and why Sawyer and LABI oppose the bill. Attorneys are already swarming and eager to get onboard, they say. Sawyer added that contingency-fee attorneys hired by the state would only stir up more litigation and serve as "bounty hunters."

The environmental disaster in the Gulf was also bubbling beneath the surface last week when the Senate Commerce Committee rejected legislation that would have dropped the hammer on Louisiana's university law clinics. Although Senate Bill 549 went down in flames, its potential passage scared the daylights out of law school officials and supporters at Louisiana State University and Loyola, Southern and Tulane universities.

  Sen. Robert Adley, R-Benton, wanted to amend his bill to target only Tulane's Environmental Law Clinic — the only one of its kind in the state — but the committee ignored Adley's plea. Committee members knew the bill was doomed, so they wasted little time killing it after two hours of debate.

  The Louisiana Chemical Association (LCA) and the Louisiana Oil and Gas Association backed Adley's bill, due chiefly to the law clinic's long history of going after their members. "Their mission seems to be to attack business and business advancement and industrial advancement," LCA President Dan Borne said.

  Tulane University President Scott Cowen said law clinics traditionally serve those most in need of legal assistance, which is one of the reasons the state helps pay for the process. Had the bill passed, Cowen said, the poorest citizens of Louisiana "would have been thrown under the bus" and denied access to justice. No amendment could have salvaged the bill, Cowen said, adding, "The bill isn't even fixable."

  The millions of barrels of oil spreading throughout Gulf waters are another reason law clinics are needed, Cowen said. "We are dealing with one of the most catastrophic, environmental issues we've ever had in the history of the United States, and yet we're here arguing about cutting off access to people and to those who couldn't get it without law clinics."

  Who knows? The Tulane Environmental Law Clinic may contribute something of its own to the wave of lawsuits that are sure to continue cresting for some time.

  As for BP, the Chicago Tribune reported last week that the company has enlisted the services of the Windy City's own Kirkland & Ellis, no stranger to oil spill litigation. The first thing on the defendant's agenda is influencing where the related lawsuits will be heard. BP wants Houston, the paper reports, no doubt because it's the center of the American petroleum industry, while others are lobbying for New Orleans, where juries are famously pro-plaintiff.

  While that first round of legal drama gets ready to unfold, the Gulf tide will continue pushing in additional crude — and, of course, more plaintiffs.

Jeremy Alford can be reached at jeremy@jeremyalford.com.

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