BP PLC (ADR) (NYSE) finally settled its criminal liability under governmental claims yesterday after it agreed to pay highest ever criminal penalty of $ 4.5 billion an amount that clearly surpassed the record highest liability of $ 1.195 billion paid by Pfizer Inc.(NYSE:PFE) in 2009. The settlement did not cover the claims from lenders and private plaintiff, Federal government, Louisiana Alabama. State officials remain divided on governing laws and level of authority over funds received.
The settlement brought closure to 11 charges on manslaughter 2 on misdemeanors under Clean water Act and Migratory Bird Treaty Act as BP PLC (ADR) (NYSE) pleaded guilty o all counts. Attorney’s of site managers Bob Kaluza and Don Vidrine who face charges by US government for having “failed to maintain control” on the oil rig say they will defend their case.
A felony count of congressional obstruction of actual figures of oil spill to avoid liability was also put to rest. The guilty plea may clarify many issues on rig owners responsibilty but final impact on liability of Swiss owner operator of deepwater Horizon rig Transocean Ltd. (RIG) is still undetermined.
Edward Markey who lead congressional investigation said that BP PLC (ADR) (NYSE) manipulated figures of barrels spill in ocean to minimise liability. US government has also charged David Rainey Former Vice president for the estimation was also charged personally for making the oil spill “appear less catastrophic” as Assistant Attorney General puts it. Despite the company’s guilty pleas, Rainey’ attorney says he will plead not guilty.
The company may still struggle against charges on accounts of pollution and environmental damage.Garret Graves , Chairman Louisiana Coastal protection and Restoration Authority estimates such claims “will easily be in the tens of billions of dollars”. Fines for violating Clean Wtater Act may each upto 17.6 billion figure. BP PLC (ADR) (NYSE) partners including Mitsui & Co and Texas-based Anadarko Petroleum Corporation (NYSE:APC) have already settled all pollution claims.
The U.S. Attorney general Eric Holder say US will continue civil proceedings against the company saying”we have not reached a number that I consider satisfactory”. The claims damaging coastlines await non jury hearing before Federal court in New Orleans in February next year.
The Company paid $ 525 million to Securities and Exchange Commission(SEC) charges and also agreed to 5 year monitoring by SEC. Attorney Steven Toll, who represents investors thinks the guilty plea will build a strong case for his clients.