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BP claims czar backs off proximity to oil spill in paying claims

by Dara Kam | October 4th, 2010

How close a business is to where oil actually washed up on the beach won’t be a factor in determining whether it is eligible to be paid for lost revenues, BP claims czar Ken Feinberg has decided.

Feinberg revamped the claims process after being pressured by a bipartisan coalition of Florida officials, including Gov. Charlie Crist, Attorney General Bill McCollum and Chief Financial Officer Alex Sink.

Today, Kenneth Feinberg, Administrator of the Gulf Coast Claims Facility, announced that geographic proximity to the BP oil spill would not prevent a legitimate individual or business claim from being processed.

“I have heard from elected officials in Florida, including Governor Crist, Attorney General McCollum, CFO Sink and others, about their concerns regarding Floridians’ proximity to the spill and how, regardless of distance, there has been economic impact beyond the areas closest to the spill. After listening to these concerns, I have concluded that a geographic test to determine eligibility regarding economic harm due to the oil spill is unwarranted,” Feinberg said in the statement.

Claimants must “rove damages resulting from the spill itself and not other causes, but “physical proximity from the spill will not, in and of itself, bar the processing of legitimate claims,” he said.

His reversal on proximity is a victory for Florida hotel and restaurant owners, who hired a legal dream team to fight Feinberg and help businesses get their claims paid.

The Florida Restaurant and Lodging Association and state elected officials objected to Feinberg’s inclusion of proximity as a factor in paying claims. They said tourists stayed away from the Sunshine State because they had the perception that oil had contaminated areas of Florida even where it hadn’t.

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One Response to “BP claims czar backs off proximity to oil spill in paying claims”

  1. Unreal Says:

    While i do consider his change in proximity to be a victory for the claimants, this is not a victory for our elected officials. Sink and McCollum along with private attorneys have spent a great amount of time fighting with Mr. Feinberg to make more concessions.
    Unfortunately it was Feinberg’s plan all the way along to extend proximity and consider wider damages to the tourism industry. He wanted to get all of the claims compiled that he could and figure out the maximum exposure for the Fund.
    Then he started paying out the ones that had the strongest claims in court first to see where he was.
    Mr. Feinberg is extremely intelligent and ‘giving up’ on this issue was already part of the plan from day 1. Watch for further concessions once the final settlements start and he can gauge how much money is left.
    On a related note, Halliburton and others have moved the court in a class action suit to determine percentage of responsibility in the case. So begins the first round of the oil spill lawsuit drama.

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