Who benefits most from the BP oil spill settlement?

Economy Lawsuit Abuse Louisiana Trial Lawyers

By Melissa Landry, Louisiana Lawsuit Abuse Watch

Class action lawsuits are notorious for producing highly lucrative legal fees, but the lawyers and administrators profiting off of the BP settlement have brought this unscrupulous practice to a whole new level.

Nearly five years after the Deepwater Horizon disaster in the Gulf of Mexico, Louisiana Lawsuit Abuse Watch took a close look at where all the money is going and asked the critical question: Who is benefiting most from the unprecedented class action settlement set up to compensate victims in the aftermath of the 2010 oil spill?  What we found was stunning!

Transaction costs stemming from the oil spill settlement are easily the largest in American history, with $471 million being spent on administrative overhead in 2013 alone. That’s nearly a half a billion dollars—or about what it cost to run the entire City of New Orleans that year.

The city funded schools, roads, hospitals and provided police protection, affordable housing, and many other important public services, while lawyers and administrators working on the oil spill settlement used roughly the same level of funding over the same period of time to pay less than 42,000 claims? Something about that math doesn’t add up.

What’s worse is that while lawyers and administrators are getting rich off of the settlement, more than 145,000 disaster victims are still waiting for their payments. That’s wrong.

This case is first and foremost about the people, the families, and the businesses that were affected by the spill– not the lawyers and administrators who showed up in its aftermath to profit from it.

This is yet another reason why America’s legal system needs massive reform.  Our courts should be used to make victims whole, not lawyers and administrators rich!

Melissa Landry is executive director of Louisiana Lawsuit Abuse Watch (LLAW), the state’s leading legal watchdog organization. Since it was formed in 2007, LLAW has grown to nearly 6,000 supporters across the state, representing small business owners, health care providers, retirees, taxpayers and workers and their families. Using community outreach, voter education and grassroots advocacy, LLAW works to raise awareness about the costs and consequences of lawsuit abuse and urge elected officials to bring more balance, fairness and common sense to Louisiana’s civil justice system. To learn more, visit www.LLAW.org.

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A project of Citizens Against Lawsuit Abuse, Sick of Lawsuits is an online network of people who are interested in restoring integrity to our justice system by addressing issues surrounding legal reform. We encourage citizens to be empowered as legal consumers, take action against abuses, and help restore common sense and fairness to our legal system.


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