The subtlety of appellate review is often not subtle at all. But there are still points to be made.
I am going to only comment today on the majority opinion and only then to fix these thoughts in my mind for later.
1) The court made much of BP's waiver of the $75 million dollar cap under the OPA, essentially beginning with a mention of this, so let's start with this. First, this is true and at first blush completely noble of BP to take this responsibility. Even at second blush it looks good, but the blush dies down slightly (it was and is a grand gesture) on further review. This is both a great deal and a compromise. Were the cap not waived, the remedy to those hurt would not have stopped, in this case, at 75 million dollars. Instead, the remedy would have derived from criminal penalties. BP (and others) were charged and pled guilty to various crimes which I will save for another blog. Restitution is the word for compensation in a criminal case and it is routine to award it. In this case, electing restitution over civil penalties would have deprived BP of almost any defense to payment that exists in the civil case. One judge might well have ordered the company dissolved to pay restitution. This way, the very worst case scenario (hardly necessary in this situation as it currently stands) would be a chapter 11. Because BP made this election, to waive the cap, they are largely in control of their own destiny. Will this be insanely expensive for them? Yes, it already has been. But it is a matter of "compensation" and that is what this hearing was about. Who should be compensated under a settlement.
2) The court made a footnote dig at the PSC for not objecting to review and arguing that "The Court" meant that review stopped at the district court judge handling the case. After making this pronouncement which appears to question whether the PSC is captained by "perfect" attorneys who never miss anything, the majority goes on to ignore the relevance of this issue. The law is not perfect, and those who work with it are fallible, perhaps the majority just wanted to remind everyone of this in case there were problems within the opinion. The court could easily have said that this issue of who was the final arbitrator resided in the district court and that the PSC was merely imperfect for not raising this issue, but they were not about to let this matter go. The dig is merely to strengthen their position, since further appeal is possible, perhaps even likely given the amount of money involved if not the chance of success. I question anyone taking this settlement further, but I can't dispute their right to do so.
3) The court ruling goes on, as I interpret it, to say that despite an "apparent" agreement to compensate according to a mathematical formula, regardless of actual causation, that actual causation is a requirement. This is the antithesis of the settlement which sought to reduce everything to a math problem. That doesn't mean the decision is wrong, but it is goofy to attorneys who work in an imperfect world. It is not quite, but almost a decision that says that if a party settles a case and that after the settlement the defendant wants to question whether the party has a claim or not; they can do so. A defendant (like BP) can, in effect, settle the case and then try it on causation since the plaintiff has nothing with which to settle if causation doesn't exist. Anyone who has ever gone to court knows that the primary reason for settlement, for good or ill, is to save the possibility of losing. This is why it is so aggravating when cases are half researched before trial, ignoring the actual facts or law in favor of a quick resolution, but in some cases that is better.
4) Note that I use the wording "almost" in the preceding paragraph. This case was actually decided on a very narrow issue, the interpretation of the settlement. It doesn't say the parties couldn't settle for something else in any other case, but focuses primarily on the wording of the settlement in this case. While the appellate court builds a shaky platform under future settlements (presumably no one will open those in the past) where causation is an issue, it almost makes sense. Why almost? Because like all compromises, this case pays some people who should not have been paid, but ignores many others who have factual situations that would have allowed payment had the case gone to trial, but who did not fit perfectly in the math model. Further, the BP lawyers who structured the model were not stupid, despite leaving questions open like the one on appeal. Most of those paid under the settlement are receiving far less than their "actual" damages. Only someone on the coast knows how deeply this injured the economy there. Almost across the board real estate development alone dropped 60% and this continued for 3 years, only now does any real recovery exist. People lost their homes, the livelihoods, and much else. They are then paid a "settlement" not full compensation years later. If some other people were paid also, it is both a failing of a system and a compromise of the system and the appellate court was unwilling to leave it at that and decided instead to set some potentially unwarranted precedent. It will be interesting to see where this goes.
5) This should have been an interpretation question, instead it sets out a form of law that governs settlement. I will be interested to see whether someone raises this in the future. Whether they "settle" a claim for a sum certain and then the other side sites this appellate decision in order to question whether the plaintiff had sufficient causation to wrest the actual payment of the settlement. Perhaps I read too much into this decision.
Conclusion) Oh, to wax eloquent on this further, to have that type of time. How nice it would be to discuss concurring opinions and the dissent. But that may have to wait for another day, my insomnia gives way to dawn and the time when all the innocent people wake only after getting enough sleep and after the sun rises.
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