Oil Spill Fund Czar Ken Feinberg Is BP Lackey, Judge Says
A Louisiana judge has finally confirmed what many -- including BNET -- have argued before: Kenneth Feinberg, the Washington lawyer appointed to administer the BP's $20 billion oil spill compensation fund, shouldn't be allowed to call himself independent.
BP is, in fact, paying Feinberg's law firm $850,000 a month to administer the fund. Now, thanks to U.S. District Judge Carl Barbier's ruling this week, Feinberg is not only barred from calling himself independent. Barbier also ruled that Feinberg must fully disclose his ties to BP when dealing with any potential claimants.
A full disclosure of the relationship between Mr. Feinberg, the GCCF (Gulf Coast Claims Facility), and BP will at least make transparent that it is BP's interests (Feinberg is representing), the judge wrote.This isn't an argument of semantics. At Feinberg's town hall meetings, which are held regularly along the Gulf Coast, he is quick to remind potential claimants that they don't need a lawyer and he touts his "independent" status, Reuters reported. While it wasn't a secret that BP -- and not the U.S. government -- agreed to pay for Feinberg's services, many didn't realize how much until last fall when former U.S. Attorney General Michael Mukasey released a report on the compensation. Mukasey had been hired by Feinberg to evaluate the compensation package. Still, Feinberg argued he was independent, despite the fact that his firm's bills were paid by BP.
Why does this matter? Claimants who take a final settlement payment from the Gulf Coast Claims Facility also agree not to sue BP.
To be clear, Feinberg was appointed by President Obama specifically to ensure compensation was fairly distributed, but also to encourage victims to make a claim instead of suing. Feinberg played a similar role when he oversaw the 9-11 victims compensation fund and while he was criticized at first, he ultimately was credited for fairly administering the fund while minimizing the number of lawsuits.
The judge did stop short of ordering the nearly $3.5 billion in settlements made to date be reviewed. Which means he doesn't suspect any mishandling of the actual settlements. Still, the ruling does cast a pall over the Gulf Coast Claims Facility. And while Gulf coast residents will still go through the claims process, they'll likely bring a lawyer to the table.
Photo from Flickr user waxgrid, CC 2.0
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