Thursday, January 5, 2012

BP's spill victim fund halts payments (because lawyers wan to get paid)

BP’s fund to compensate those affected by the Gulf of Mexico oil spill has been frozen after the US courts ordered that a portion of payments to victims be collected to pay lawyers.

Louisiana judges have ordered the Gulf Coast Claims Facility (GCCF) to hold back 6pc of any payments made to claimants, to be put into a court-supervised escrow account. Escrow refers to putting money into the hands of a trusted third party.

The money collected will be used to set up a fund from which fees and expenses for litigation could be paid to the Plaintiff Steering Committee, which is the group of lawyers marshalling the many legal cases relating to the devastating spill.

The court order said that such arrangements are common in situations where a team of lawyers has been appointed to spearhead litigation on behalf of thousands of claimants and hundreds of lawyers, as in this case. Read More