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BP Sues Other Deepwater Horizon Rig Contractors

In addition to being the anniversary of the BP oil disaster, yesterday was a deadline of sorts for lawsuits in the incident to be filed. And BP got theirs in under the wire.

BP on Wednesday sued the maker of the device that failed to stop last year’s calamitous Gulf oil spill and the owner of the rig that exploded, alleging that negligence by both helped cause the disaster.

The British company said in papers filed in federal court in New Orleans that it is suing rig owner Transocean for at least $40 billion in damages, accusing it of causing last year’s deadly blowout in the Gulf of Mexico that led to the worst offshore oil spill in U.S. history. BP says every single safety system and device and well control procedure on the Deepwater Horizon rig failed.

It also is suing Cameron International, which provided a blowout preventer with a faulty design, which caused an unreasonable amount of risk that harm would occur. Both companies have filed counter claims against BP.

And that’s not all. BP sued Halliburton as well for their negligence at the Deepwater Horizon well. And similarly, Transocean filed papers seeking a judgment against BP, Cameron and Halliburton. Cameron also filed cross-claims and counter-claims yesterday, meeting the deadline. Basically you have everybody connected to the Deepwater Horizon rig suing everybody else in court.

The free-for-all has major implications. Billions of dollars in individual claims and fines to the government hang in the balance. The lawsuits will decide who pays and at what level. The judge will be asked basically to determine culpability, and which company violated any contractual obligations. These suits will probably take years to determine liability.

BP estimates the liabilities incurred already at $41 billion, and that does not include government fines and penalties which, if gross negligence is found, could total as much as $21 billion more. It’s a testament to the profitability of oil companies that this hasn’t come close to bankrupting BP, but they’re trying to spread the liability around so these other companies can share the burden.

The admission of guilt or negligence here is as important as the monetary damages. Having a legal record of who’s at fault will be a major factor in future claims and penalties.

This is one of those lawsuits where practically nobody in America has a rooting interest.

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David Dayen

David Dayen

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