BP Reaches Record $4 Billion Criminal Settlement with US in Connection with Deepwater Horizon Incident
In a Press Release issued yesterday afternoon, the United States Department of Justice announced that BP Exploration and Production Inc. has agreed to plead guilty and pay a record $4 billion in criminal fines and penalties in connection with the April 20, 2010 explosion and fire on the MODU Deepwater Horizon, which resulted in the deaths of eleven (11) people and a massive oil spill in the Gulf of Mexico. The Department of Justice reports that the settlement is the largest criminal resolution in United States History.
In the Plea Agreement, which is subject to the approval of the United States District Court for the Eastern District of Louisiana, BP agreed to plea guilty to eleven (11) counts of felony manslaughter; one (1) count of felony obstruction of Congress; and misdemeanor charges under the Clean Water Act and Migratory Bird Treaty Act. Approximately $2.4 billion of the $4 billion settlement will be paid to the National Fish and Wildlife Foundation, a non-profit organization which is expected to direct the funds to projects for environmental restoration, preservation, and conservation efforts throughout the Gulf region. BP has also agreed to implement enhanced safety and risk management processes, through the retention of a process safety and risk management monitor and an independent auditor. BP also reached a $525 million settlement with the U.S. Securities and Exchange Commission regarding civil securities fraud charges.
The settlement does not resolve the other pending disputes arising from the spill, including the United States' action against BP and other defendants to recover civil penalties under the Clean Water Act and Oil Pollution Act. The first phase of a civil limitation and liability trial is currently scheduled to commence on February 25, 2013.
In addition to the settlement with BP, a grand jury in the Eastern District of Louisiana returned a twenty-three (23) count indictment against the two (2) highest-ranking BP supervisors onboard the Deepwater Horizon on April 20, 2010, alleging negligent and grossly negligent conduct against both men. The two (2) former supervisors are each charged with eleven (11) felony acts of seaman's manslaughter; eleven (11) felony counts of involuntary manslaughter; and one (1) violation of the Clean Water Act. A former BP executive that served as a Deputy Incident Commander during the oil spill response was also charged in a separate indictment with obstruction of Congress and making false statements to law enforcement officials.
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