BP appears in court to enter criminal plea over 2010 spill

BP Plc appeared in federal court in New Orleans to answer U.S. charges brought over the 2010 Gulf of Mexico oil spill, entering a not guilty plea that won’t affect its $4 billion criminal settlement with the U.S.

BP’s deal with the Justice Department announced Nov. 15 requires it to plead guilty and pay $4 billion to end all criminal charges related to the largest offshore oil spill in U.S. history. Under the plea deal, BP will enter a formal guilty plea at a later hearing.

“At this time all I can do is take a not guilty plea,” U.S. District Judge Ivan Lemelle in New Orleans said at a court hearing today. Lemelle said he conferred with Chief Judge Sarah Vance, who has been assigned the case. “Anything else will be done before her” at a later date, Lemelle said.

BP’s settlement with the U.S. includes a record $1.256 billion criminal fine, which would be paid over five years. BP agreed to five years’ probation and extensive monitoring of its drilling operations, according to court papers.

Along with the criminal fine, the resolution with the Justice Department includes a total of $2.4 billion that will be paid to the National Fish & Wildlife Foundation over five years. Another $350 million will be paid to the National Academy of Sciences over that same period.

“This is a very substantial criminal penalty,” said Ed Sherman, a law professor at Tulane University in New Orleans. “This is much more than a slap on the wrist,” he said.

Highly Regulated

“They are going to be more highly regulated than any other oil company in history,” Sherman said, pointing to requirements in the agreement for monitoring BP’s oil and gas operations. “The monitoring is particularly focused on safety.”

Beyond the $4 billion criminal settlement, BP will pay an additional $525 million to resolve claims by the Securities and Exchange Commission that the London-based company underestimated the size of the spill to bolster stock prices.

BP agreed to plead guilty to 14 criminal counts including 11 for felony manslaughter for the 11 people who died when the Deepwater Horizon drilling rig exploded and sank, according to the Justice Department.

The company also pleaded guilty to one misdemeanor count under the Clean Water Act, one misdemeanor count under the Migratory Bird Treaty Act and one felony count of obstruction of Congress, the U.S. said.

Page 1 of 3 >>

Copyright 2014 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Comments
comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome