BP fund-seekers might have to waive right to sue

People and businesses seeking a lump-sum settlement from BP’s $20 billion oil spill compensation fund will most likely have to waive their right to sue not only BP, but also all the other major defendants involved with the spill, according to internal documents from the lawyers handling the fund.

The documents — which include e-mails, draft and final versions of the protocols, claims forms and legal notes about the administration of the fund — provide the first definitive picture of who will be paid by the $20 billion fund, and how and when.

They also shed new light on the components of the payment plan that are likely to stir controversy, including the fund’s emphasis on geographic proximity as a determining factor for eligibility.

The fund is being administered by a prominent Washington lawyer, Kenneth R. Feinberg, who declined to be interviewed about the documents but verified their authenticity.

The eligibility requirements for compensation from the fund are similar to those of the 9/11 victims compensation fund, which Mr. Feinberg also handled. People affected by the spill seeking final settlements face a choice similar to that faced by the 9/11 victims: If they decide to sue instead of accepting a settlement, they could face years of litigation; and if they decide to accept the settlement, it could come before the full damage from the spill is known.

A key difference between the spill fund and the Sept. 11 victim compensation fund is the matter of geographic proximity. The 9/11 fund took that issue into account, but it was less controversial because that fund focused on compensating people injured in the terrorist attacks and families of those killed rather than adversely affected businesses.

Fishermen, shrimpers and seafood processors as well as hotel and restaurant owners with beachfront property in areas where oil washed ashore will have the easiest time getting reimbursed. An ice cream parlor or a golf course miles from the affected shore but along the main highway headed to the beach will probably not be eligible, the documents indicate.

More at the New York Times.