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BP faces billions in spill payments

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A federal appeals court in New Orleans on Monday refused to reconsider its previous ruling that businesses don’t have to prove they were directly harmed by BP Plc.’s 2010 Gulf of Mexico oil spill to collect settlement payments.

The company had asked the 5th US Circuit Court of Appeals to rehear the case after a three-judge panel’s March ruling, the Associated Press reported. But the court voted 8-5 against a rehearing.

BP had agreed in a 2012 settlement to pay claims without requiring proof that losses were directly caused by the spill resulting from the explosion of the Deepwater Horizon oil rig, which killed 11 workers.

Judge Leslie Southwick wrote in the order that the 2012 policy statement spelled out the criteria for business firms.

“Instead of direct evidence of a causal connection between the Deepwater Horizon disaster and the claimant’s business losses, the Exhibit described four geographic zones, several types of businesses, formulae for presenting economic losses, and various presumptions regarding causation that apply to specific combinations of those criteria,” the judge said.

Attorneys Steve Herman and Jim Roy, lead lawyers for the steering committee of plaintiffs in the case, applauded the ruling. “We are pleased that the Court of Appeals agreed that BP must honor its contract,” they said in an email.

BP’s spokesman Geoff Morrell said the company is considering its legal options, according to the AP

The company has now two options – pay claims the company has called “fictitious,” or appeal further to the US Supreme Court, Bloomberg said.

BP has said in court filings that paying the claims will cost additional billions of dollars. Payments for disputed business economic losses have been on hold while BP appealed.

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