Skip to main content

BP's billions at stake as courtroom showdown starts

By Ed Lavandera and Jason Morris, CNN
February 26, 2013 -- Updated 0224 GMT (1024 HKT)
STORY HIGHLIGHTS
  • NEW: The Gulf oil spill was "a multiparty event," BP lawyer argues
  • Billions of dollars are at stake as a judge weighs negligence and financial penalties
  • BP is fighting to limit fines, while the company's critics hope to see a landmark punishment
  • A judge will weigh whether BP was grossly negligent and determine how much it owes

New Orleans (CNN) -- A titanic courtroom showdown with billions of dollars in the balance opened in New Orleans on Monday, with oil giant BP arguing it shouldn't face the government's steepest penalties for the 2010 Gulf oil spill.

BP already pleaded guilty to criminal charges and agreed to a record-setting $4 billion fine for the spill. But it could face more than $20 billion in additional environmental penalties if found to have committed gross negligence in the disaster.

In a packed federal courtroom Monday afternoon, BP attorney Mike Brock said blame for the disaster wasn't the oil company's alone. A string of bad decisions by Transocean, the company that owned the doomed drill rig Deepwater Horizon; well cement contractor Halliburton; and BP all led to the blowout, he said.

"We do not believe that men and women of BP behaved in willful misconduct," Brock said. "It was a multiparty event."

But Halliburton attorney Don Godwin said BP ignored the contractor's recommendations about the cement job and that Transocean didn't move fast enough to contain the blowout.

Transocean settled with the government last week for $1 billion in Clean Water Act penalties but could face additional additional liability in the case that started Monday. Transocean lawyer Brad Brian said that last week's settlement was not an admission of gross negligence and that last-minute changes to the well design by BP had the rig's crew "at wits' end" before the disaster.

All three companies have been pointing fingers at each other since the April 20, 2010, blowout that sank the Deepwater Horizon, killed 11 men aboard and uncapped an undersea gusher that spewed for nearly three months. The spill's effects on the environment are still being cataloged.

The plaintiffs in the civil case that opened Monday include five Gulf states, individuals, businesses and the federal government.

"Evidence will show BP placed huge financial pressure to cut costs, cut corners, and rush the job," attorney James P. Roy, who represents the coalition of plaintiffs, said during opening arguments on Monday.

And Alabama Attorney General Luther Strange said the oil giant "was blinded by their bottom line."

"The spill was tragically inevitable due to BP's corporate culture," Strange said. "The evidence will show that, at BP, money mattered most."

If it is found to have been "grossly negligent" under the Clean Water Act, it could be fined as much as $4,300 per barrel of oil spilled into the Gulf of Mexico. If it's found "negligent," the company could be fined about $1,100 per barrel.

Attorneys will also likely square off over how much oil gushed into the gulf, another key figure that will be used to calculate how much money BP might owe. Officials have said 4.9 million barrels -- about 205 million gallons -- of oil spilled, while BP says that number is overblown and that authorities should use a maximum figure of 3.1 million barrels of oil when calculating the fine.

The trial will also determine what fines the company faces under National Resource Damage Assessment, which aims to restore environmental damage caused by the spill. Environmental groups want to see those fines -- which will put a specific price tag on damage to plants and wildlife -- total around $25 billion.

With so much money at stake, each side has brought an army of lawyers to the fight. With almost 60 lawyers filling the courtroom, the judge created a seating chart for all the attorneys. Lawyers representing the federal government and other plaintiffs sat on one side, while the BP lawyers and other companies' lawyers sat across the room.

Three overflow courtrooms were also packed on Monday.

BP says it has already paid billions in spill-related cleanup and compensation costs and has been barred from new federal contracts. Though Halliburton and Transocean could also face penalties, much of the criticism from environmentalists before the high-profile trial has focused on BP, the undersea well's owner.

"The damage done here is real, both to the environment and to the people," said Brian Moore, of the National Audubon Society. "And BP should not have the chance to get off cheaply on this."

In his statement before the trial began, BP General Counsel Rupert Bondy said the company would push for the court to consider lower penalties, arguing that BP made efforts to do the right thing and "immediately stepped up" and acknowledged its role in the spill.

"To date we've spent more than $23 billion in response, cleanup, and payments on claims by individuals, businesses and governments," he said. "No company has done more, faster, to meet its commitment to economic and environmental restoration efforts in the wake of an industrial accident."

CNN's Vivian Kuo and Catherine E. Shoichet contributed to this report.

ADVERTISEMENT
Part of complete coverage on
December 16, 2014 -- Updated 2245 GMT (0645 HKT)
Pakistan Taliban say the school attack was revenge for the killing of children in a military offensive -- but they are being pressed by defections to ISIS.
A group that claims it hacked Sony Pictures has posted a public threat against moviegoers who see Sony's "The Interview."
December 18, 2014 -- Updated 0243 GMT (1043 HKT)
The gunman behind the deadly siege in Sydney this week was not on a security watch list, and Australia's Prime Minister wants to know why.
December 18, 2014 -- Updated 0948 GMT (1748 HKT)
Bestselling author Marjorie Liu had set her sights on being a lawyer, but realized it wasn't what she wanted to do for the rest of her life.
December 16, 2014 -- Updated 2027 GMT (0427 HKT)
CNN's Matthew Chance looks into an HRW report saying Russia has "legalized discrimination against LGBT people."
December 16, 2014 -- Updated 0212 GMT (1012 HKT)
The Sydney siege has brought home some troubling truths to Australians. They are not immune to what are often called "lone-wolf" terror attacks.
December 16, 2014 -- Updated 0012 GMT (0812 HKT)
A social media campaign condemning Islamophobia under the hashtag #illridewithyou has taken off after Sydney hostage siege.
Bill Cosby has kept quiet as sexual assault allegations mounted against him, but his wife, Camille, finally spoke out in defense of her husband.
December 15, 2014 -- Updated 1144 GMT (1944 HKT)
China-bound AirAsia flight turns back to Bangkok after passenger throws water over crew member.
December 15, 2014 -- Updated 1026 GMT (1826 HKT)
It takes Nepalese eye doctor, Sanduk Ruit about five minutes to change someone's life.
December 16, 2014 -- Updated 1054 GMT (1854 HKT)
This epic journey crosses 13,000 kilometers, eight countries over 21 days. Find out where.
December 18, 2014 -- Updated 1416 GMT (2216 HKT)
Each day, CNN brings you an image capturing a moment to remember, defining the present in our changing world.
Browse through images from CNN teams around the world that you don't always see on news reports.
ADVERTISEMENT