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October 09, 2014

BP Seeking to Undo Spill-Damage Awards to Nonprofits

BP is asking a federal court to review payments to a handful of nonprofits that received damage awards in the wake of the 2010 Gulf of Mexico oil spill, claiming the funds were paid in error to organizations that suffered no losses, Bloomberg reports. Lawyers opposing the move warned that a finding for BP would open the floodgates to retracting hundreds of thousands of damage claims.

The energy company argued at the U.S. Court of Appeals in New Orleans on Monday that the administrator of its settlement program misunderstood the deal and thus paid hundreds of thousands of dollars to nonprofits that were not entitled to damages. The firm says claims should be limited to businesses that lost profits as a result of the disaster.

BP's case has been rejected by lower courts. Spill victims' lawyers contend the company is using the nonprofits to test whether it can win appellate review of individual damage awards, which they say is not permitted under the settlement, an interpretation BP disputes.