Advertised as a claimant-friendly and non-contentious claims program, the BP Deepwater Horizon Court Supervised Settlement Program has proven to be anything but. With claims filed three years ago languishing in a bureaucratic queue along with 100,000 others, navigating this program pro se (without an attorney) is a fool’s errand.

Unfortunately, many business owners, in a misguided attempt to maximize their recovery, have chosen not to hire the legal and financial professionals necessary to see a claim through to a successful conclusion. Such pro se claimants will likely never receive a dime, and those that do will be fortunate to see fifty cents on the dollar. The following comment from one of the Court Appointed Appeal Panelists says it best.

Pro Se BP Claim Appeal Decision

Remember, attorneys should only charge you a fee if they recover for you. We never charge anything up-front, nor if we lose. Our interests are firmly aligned. We only get paid if you get paid, and the more you get paid the better.

That said, if you have timely filed your Business Economic Loss (BEL) claim, yet still do not have an attorney working on your behalf, the following is what you can expect.

Fighting for an Eligibility Notice

First, the Claims Administration Vendors will attempt to assign an appropriate industry code (known as a NAICS code) that best represents the nature of your business. The assignment of the NAICS code can make or break your claim. Certain codes representing certain industries are excluded altogether from payment. Others are subjected to the dreaded “moratoria review,” a veritable black hole into which no claims have yet emerged payable. Finally, codes representing tourism entities enjoy a higher “Risk Transfer Premium” (RTP), yet many pro se claimants are unable to adequately articulate to the Claims Administrator why they deserve a tourism NAICS designation.

BP claims help

Tom Young is a sought after speaker on the BP claims process and is often interviewed by national media.

Assuming one emerges unscathed from the NAICS assignment process, program vendors will attempt to better understand the nuances of your business. For instance, do you operate a “facility” as it is defined in the Settlement Agreement? Do you operate one such facility or are you a “multi-facility” claimant? If multi-facility, do all facilities fall within a compensable geographic region? Or are some located outside of the Gulf? If outside, have you backed out the financials associated with those non-qualifying facilities from your submitted P&L’s?

Next, what type of Business Economic Loss claim have you filed? Are you an Existing Business? A Start-Up? A Failed Business? Or a Failed Start-Up? Each claim type requires different inputs. For instance, Start-Up claims must be supported by Customer Revenue Mix (CRM) data that identifies the geographic origin of a claimant’s revenue. The onus is on the claimant to produce such CRM data.

Do you meet the causation standards? Many claimants will not enjoy presumed causation, as such, one must pass the “V,” “Modified-V,” or “Downward-Only” tests. Which causation test can you pass? Are you including the appropriate revenue inputs when running the test? Gross Revenue is a worthless indicator, only Net Operating Revenue may be used.

Assuming you demonstrate causation, how will your claim be valued? Are your P&L’s sufficiently matched? If so, the formulas in Exhibit 4C will be used, if not, Policy 495 will apply. If Policy 495, are you subject to the Average Variable Margin Methodology (AVM) or one of the specialized frameworks? Are you able to advocate for the application of Exhibit 4C’s formulas to your claim rather than the value eroding Policy 495 compensation formulas? Can you articulate why your P&L’s are indeed sufficiently matched, even if you trigger one or more of the Seven Tests?

The Eligibility Notice is just the beginning

BP claim attorney help

Our law firm represents hundreds of businesses, from closely-held to Fortune 500, in the BP claims process.

BP appeals almost all Eligibility Notices over $25,000. Further, a claimant may need to appeal if the Claims Administration has denied a claim or undervalued same. The claims appeal process is known as “baseball arbitration” and is much too complex to describe adequately here. Once a claim moves from the Claims Administration vendors to the Claims Appeal Panelists, zealous legal advocacy is needed as well as a healthy working knowledge of game theory.

Once the Appeal Panel issues a decision, either BP or a claimant may apply for Discretionary Review from Judge Barbier in the Eastern District of Louisiana’s Federal Court. Judge Barbier can deny review altogether, render his own decision, or remand to the Appeal Panel for further consideration.

From Judge Barbier’s court, either BP or a claimant may appeal his decision to the 5th Circuit Court of Appeals in New Orleans. From there, the Supreme Court of the United States is always an option. Expect the process to last three to five years if appeals are involved.

So, if you still think that proceeding pro se is going to maximize the value of your claim, think again. Unless you want your BP claim to occupy the center of your professional life for the next three years, you should call us. Otherwise, time to brush up on the 1,200 pages of the Settlement Agreement, the 500+ interpretive policies implemented post-approval, the 5,000+ Appeal Panel decisions handed down pursuant to same, and the arcane language used by the Claims Administration.