Research Expert: Government's BP Gulf Settlement Is 'Shameful'

The out-of-court settlement announced Friday night of the BP Gulf of Mexico oil disaster is shamefully inadequate for victims and destroys the public's right-to-know, according to author Greg Palast, a blunt-speaking former private eye who has long investigated such tragedies.

"BP Settlement Sells Out Victims; Deal buries evidence ofGreg Palast Cover oil company willful negligence" is the title of a March 4 column by Palast, who investigated the case also for his latest book, Vulture's Picnic. Palast's comments are congruent also with our Gulf sources. They protest timid reactions by the Obama administration in deference to the clout of BP and its drilling partners Halliburton and Transocean

Samuel KentMeanwhile, WikiLeaks reported last week that a Texas federal judge imprisoned after sexually harassing staff privately blames his troubles on his ruling against Halliburton in a separate case.

WikiLeaks released what it described as an email from the Texas consultancy Stratfor quoting former U.S. District Judge Samuel B. Kent of Galveston following his release from prison. The judge, shown at right before resigning from the bench, received a 33-month sentence for perjury and related offenses in a sex scandal investigation. WikiLeaks says it obtained five million emails hacked illegally from Stratfor. It released them to illustrate the underside of the military-industrial-security complex. As part of it, a Stratfor executive boasted to colleagues that he had  secret information that the Justice Department long ago secretly indicted WikiLeaks founder Julian Assange. Sweden is seeking Assange's extradition from the United Kingdom -- ostensibly for questioning about two sexual affairs with Swedish women who invited him to sleep in their beds on separate occasions during a 2010 speaking trip.

Regarding the Texas judge Kent, WikiLeaks said a Stratfor executive sent her colleagues this report about him:

I had lunch yesterday in Houston with former-Federal Judge Sam Kent (the first Federal Judge found guilty of serious crimes in the US) and he told me why he thinks he was prosecuted. For those who haven't followed this, he was found guilty on perjury & sexual misconduct. Yes, he slept with those two women, but it was consensual. Actually, they were old affairs and long over.

What Sam said was that "isn't is strange that the Justice Department begins sniffing around for dirt to throw at me just weeks after I ruled a heavy case against Halliburton. Then a small set of affairs turn into an untrue situation and then spun up into an unprecedented case against a Federal Judge."

Of course, I told him he was nuts to rule anything against Halliburton. I also told him that this sounds like a John Grisham plotline.

Halliburton was led by Dick Cheney as CEO before he became United States Vice President from 2001 to 2009. It worked with BP on the Deepwater Horizon well leading up to the 2010 Gulf drilling disaster. But Kent's case pre-dated the Deepwater blowout. Authorities have said they prosecuted Kent, a 1990 appointee of President George H.W. Bush, because of his serious misconduct and his cover-up. U.S. District Judge Samuel Kent indicted in sex case is a Houston Chronicle story on the indictment excerpted below. In it, one of the two victims is quoted by name as saying the judge's conduct was outrageous, was not consensual and she promptly protested it to authorities.

Julian Assange

As we reported last week, WikiLeaks has been releasing Stratfor emails to show that sex misconduct claims floated in Sweden against WikiLeaks founder Julian Assange, right, are a ruse for authorities in Sweden to gain custody of him from British authorities and then ship him to the United States to face a secret indictment. The emails were hacked, or stolen, from Stratfor by as-yet unidentified persons and transmitted to WikiLeaks. It disseminated them on the web and via 25 media partners, including Rolling Stone and McClatchy newspapers in the United States.

Regarding the BP settlement announced March 2 for the Gulf disaster, Palast wrote in Mudflats, an Alaska-based web-magazine:

Some deal. BP gets the gold mine and its victims get the shaft. And a few lawyers will get vacation homes—though they won't be so stupid as to build them on the Gulf Coast. On Friday night, the judge-picked lawyers for 120,000 victims of the Deepwater Horizon blow-out cut a back-room deal with oil company BP PLC which will save the lawyers the hard work of a trial and save the oil giant billions of dollars.

It will also save the company the threat of exposing the true and very ugly story of the Gulf of Mexico oil platform blow-out. I have been to the Gulf and seen the damage — and the oil that BP says is gone.  Miles of it.  As an economist who calculated damages for plaintiffs in the Exxon Valdez oil spill case, I can tell you right now that there is no way, no how, that the $7.8 billion BP says it will spend on this settlement will cover that damage, the lost incomes, homes, businesses and boats, let alone the lost lives — from cancers, fetal deformities, miscarriages, and lung and skin diseases.

Palast continued, taking a harsh view of the Obama administration's role, as have several of other our other expert sources:

Two years ago, President Barack Obama forced BP to set aside at least $20 billion for the oil spill's victims. This week's settlement will add exactly ZERO to that fund. Indeed, BP is crowing that, adding in the sums already paid out, the company will still have spent less than the amount committed to the Obama fund. There's so much corrosion [sic], mendacity and evil here in this settlement deal that I hardly know where to begin. So, let's start with punitive damages.

I was stunned that there is no provision, as expected, for a punishment fee to by paid by BP for it's willful negligence. In the Exxon Valdez trial, a jury awarded us $5 billion in punitives -- and BP's action, and the damage caused in the Gulf, is far, far worse. BP now has to pay no more than proven damages. It's like telling a bank robber, "Hey, just put back the money in the vault and all's forgiven."

This case screamed for punitive damages....For example, the only reason six hundred miles of Gulf coastline has been slimed by oil was that BP failed to have emergency oil spill containment equipment ready to roll when the Deepwater Horizon blew out. BP had promised the equipment's readiness in writing and under oath.

And here's the sick, sick part. This is exactly the same thing BP did in the Exxon Valdez case. It was BP, not Exxon, that was responsible for stopping the spread of oil in Alaska in 1989. In Alaska, decades ago, BP told federal regulators it would have oil spill "boom" (the rubber that corrals the spreading stuff) ready to roll out if a tanker hit. When the Exxon Valdez struck Bligh Reef, BP's promised equipment wasn't there: BP had lied.

Bill BarnesPalast was scheduled to broadcast his views further March 5 on Democracy Now! with host Amy Goodman. Listings for access nationally are here. Palast, a guest last month on my weekly public affairs show, MTL Washington Update, recently authored Vulture's Picnic, a book about oil company polluters and financial executives who call themselves "Vultures" because they profit immensely from other people's disasters. Palast is far from alone, but critics tend to have scant clout in view of the importance of BP both in the energy industry and in military fuel supplies required for U.S. outposts and actions worldwide. In 2010, for example, Alabama's Democratic nominee for the U.S. Senate Bill Barnes, right, raised concerns with Washington officials on behalf of Gulf victims in a forum at the National Press Club organized by the Justice Integrity Project. But Environmental Protection Agency and White House officials gave him a cold shoulder when he tried to meet to learn their priorities.

Palast recently lectured also at the National Press Club to fellow investigative reporters. He is passionate about the evidence he gathered in his years as a private eye probing the oil industry in the 1990s, with a heavy focus on the Exxon-Valdez disaster in Alaska. Palast holds a master's degree in business administration earned at the University of Chicago under the iconic free-market economist Milton Friedman. Palast brings that kind of expertise to attacking as grossly inadequate the federal Gulf victim fund and claims procedure supervised by Kenneth Feinberg, the special master jointly appointed by BP and Obama administration. For more information on him and his books, click details. See below for additional news reports.


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Relevant News Reports

BP Settlement

Mudflats News, BP Settlement Sells Out Victims; Deal buries evidence of oil company willful negligence, Greg Palast, March 4, 2012. As BP had no choice but to pay proven damages and conceded as much, what exactly are the lawyers getting paid for? (Don't be surprised if Greg Palastthe fee requests hit a billion dollars.) How could these lawyers let BP walk away on the cheap? The judge picked the lawyers that would settle or try the case for the 120,000 plaintiffs. His Honor side-lined the legal "A-Team," like Cajun trial lawyer Daniel Becnel, guys with the guts, experience and financial wherewithal to go eyeball-to-eyeball with BP and not blink. Welcome to Louisiana, oil colony. So BP walks without the civil punishment that tort law and justice demand, grinning and ready to do it again: drill on the cheap with the price paid by its workers and the public. But stopping a trial denies the public more than the full payment due: it denies us the truth, the whole truth and nothing but the truth. The President has just opened up the arctic waters of Alaska for drilling, has reopened the Gulf to deepwater platforms, and is fiddling with the idea of allowing the XL Pipeline to slice America in half.

Democracy Now! Is the $7.8 billion BP oil spill settlement a bad deal for Gulf residents and businesses? Video interview by Amy Goodman, March 5, 2012. Investigative journalists Greg Palast and Antonia Juhasz examine who wins and who loses in BP’s settle­ment. “[BP’s] ba­si­cally being told, like a bank rob­ber — you put the money back and every­thing will be for­given,” says Palast, who also in­ves­ti­gated the Exxon Valdez set­tle­ment. Mean­while, state and fed­eral gov­ern­ments are still pur­su­ing sep­a­rate civil claims against BP for en­vi­ron­men­tal dam­age. “That’s when we’re going to hope­fully un­cover those 72 mil­lions pages of in­ves­ti­ga­tion that will in­clude wrong doing not just by BP, not just by Transocean, not just by Hal­libur­ton, but by every major oil com­pany in­volved off­shore, and very likely based on my re­search, wrong­do­ing by the Obama ad­min­is­tra­tion,” says Juhasz. “It is a de­sire to keep that out of the pub­lic that has pushed the set­tle­ment process for­ward.” We also speak with Florida State Uni­ver­sity Oceanog­ra­phy Pro­fes­sor Ian Mac­Don­ald about what it means to re­store the Gulf of Mex­ico. In the wake of the oil spill, BP pledged up to $500 mil­lion over a decade to con­duct in­de­pen­dent sci­en­tific re­search on the en­vi­ron­men­tal ef­fects. But Mac­Don­ald notes that, “When the oil was gush­ing, there were lit­er­ally hun­dreds of ships … study­ing this dis­as­ter. Now as we try to learn what hap­pened, and pre­pare our­selves for the next cat­a­stro­phe, we have noth­ing like those kinds of re­sources pre­sent.”

Washington Post, BP, plaintiffs reach Gulf of Mexico oil spill settlement, Steven Mufson, March 2, 2012. BP will pay an estimated $7.8 billion to settle a lawsuit over the massive 2010 Gulf of Mexico oil spill with attorneys representing thousands of individual plaintiffs and businesses on the eve of a major trial in a New Orleans federal court, the company said Friday night. BP said it expects to pay the settlement from the money remaining in a $20 billion escrow account, or trust fund, it set up during the spill to resolve individual and business claims without going to court.  BP, the government and an army of volunteers are fighting to contain and clean the millions of gallons of oil spewing from the site of the Deepwater Horizon explosion in the Gulf of Mexico. BP agreed late Friday to settle lawsuits brought by more than 100,000 fishermen who lost work, cleanup workers who got sick and others who claimed harm from the oil giant's 2010 Gulf of Mexico disaster. The settlement amount includes $2.3 billion to help resolve economic loss claims related to the gulf seafood industry, the company said. The rest of the money paid out by BP will be determined by two separate sets of formulas and matrices, one for economic claims and one for medical claims. The process will be court supervised. BP also agreed to provide medical consultations for the next 21 years to people with health-related claims and to pay $105 million to improve health care in gulf communities.

Kenneth FeinbergLocust Fork News-Journal, BP Announces Lawsuit Settlement with People Along the Gulf Coast, Glynn Wilson, March 3, 2012. British Petroleum company has reached a tentative settlement agreement with a large number of people along the Gulf of Mexico coast who are suing for damages from the largest and most devastating environmental disaster in U.S. history. If the plaintiffs agree to the final settlement and it is approved by the court and the government, it will prevent a prolonged court trial and members of the public who suffered damages may receive compensation much sooner, although the amount they receive would be reduced. The settlement calls for ending the separate claims fund run by Ken Feinberg, shown at right in a Wikipedia photo. The Obama administration hired him to handle paying out $20 billion the administration seized from BP.

Questions remain, however, about whether all of those damaged by the spill will agree to the settlement. Those waiting for money from Feinberg’s Gulf Coast Claims Facility can take what the settlement vehicles offer or opt out and make a claim directly to a BP-run entity. Or they can file separate lawsuits and hold out for more, but that could take many years to work its way through the courts and then there is no guarantee the amounts won’t be thrown out of court by conservative judges in the South.


Justice Integrity Project, WikiLeaks Claims Secret U.S. Charges Against Assange, Andrew Kreig, Feb. 29, 2012. WikiLeaks announced Feb. 28 that it has obtained a hacked email from Stratfor, a Texas political intelligence company with ties to Karl Rove, discussing a secret U.S. indictment of WikiLeaks founder Julian Assange. Reported also is evidence that Sweden’s Foreign Minister Carl Bildt, a former prime minister, is a longtime CIA informant in Sweden, which is ostensibly a neutral country that boasts of a strong human rights record. The U.S. Justice Department and Stratfor have declined comment.

WikiLeaks, Global intelligence files in relation to Sam Kent and Halliburton from Wikileaks, Press release, Feb. 27, 2012. Today, WikiLeaks began publishing The Global Intelligence Files – more than five million emails from the Texas-headquartered "global intelligence" company Stratfor. The emails date from between July 2004 and late December 2011. They reveal the inner workings of a company that fronts as an intelligence publisher, but provides confidential intelligence services to large corporations, such as Bhopal’s Dow Chemical Co., Lockheed Martin, Northrop Grumman, Raytheon and government agencies, including the US Department of Homeland Security, the US Marines and the US Defense Intelligence Agency. The emails show Stratfor’s web of informers, pay-off structure, payment-laundering techniques and psychological methods....The material contains privileged information about the US government’s attacks against Julian Assange and WikiLeaks and Stratfor’s own attempts to subvert WikiLeaks. There are more than 4,000 emails mentioning WikiLeaks or Julian Assange. The emails also expose the revolving door that operates in private intelligence companies in the United States. Government and diplomatic sources from around the world give Stratfor advance knowledge of global politics and events in exchange for money. The Global Intelligence Files exposes how Stratfor has recruited a global network of informants who are paid via Swiss banks accounts and pre-paid credit cards. Stratfor has a mix of covert and overt informants, which includes government employees, embassy staff and journalists around the world. The material shows how a private intelligence agency works, and how they target individuals for their corporate and government clients.

Case Against Judge

Houston Chronicle, U.S. District Judge Samuel Kent indicted in sex case, Lise Olsen, Mary Flood and Roma Khanna. Aug. 28, 2008. U.S. District Judge Samuel Kent was indicted Thursday on charges of abusive sexual contact and attempted aggravated sexual abuse of a female employee, making him the first federal judge to be charged with federal sex crimes and the first in Texas indicted in recent history. The federal criminal investigation was launched in November 2007 after Kent's former case manager, Cathy McBroom, complained that the judge physically touched her under her clothing twice and often made obscene suggestions during the six years she worked for him. In the indictment, he is accused of making unwanted sexual contact "with an intent to abuse, humiliate, harass (and) degrade." The Chronicle does not normally identify sexual abuse victims, but McBroom, referred to as "Person A" in the indictment, previously released her own written statement:

After a very difficult 17 months, I feel like I have finally been validated. I have listened and read with horror as Judge Kent's lawyer suggested that what happened to me was 'enthusiastically consensual,' " wrote McBroom, who remains a federal court employee. "I am relieved to find that even federal judges are not above the law, and that sexual abuse in the workplace is never acceptable, no matter the status of the offender.

Other Court News

FireDogLake, Holder Tries to Explain Targeted Assassination Program, David Dayen, March 6, 2012.  Attorney General Eric Holder helpfully explained when the government can kill you without a trial, in a speech last night at Northwestern University. He didn’t take questions, because he was so crystal clear about it. “Given the nature of how terrorists act and where they tend to hide, it may not always be feasible to capture a United States citizen terrorist who presents an imminent threat of violent attack,” Mr. Holder said in a speech at Northwestern University’s law school. “In that case, our government has the clear authority to defend the United States with lethal force.” [...] Holder gave no legal standard for his remarks, but it appeared that he thought consultation with Congress satisfies the due process requirements of the Constitution. First of all, Congress has not been consulted to the degree that they even have the legal framework for the specific case that touched off this controversy, the killing of Anwar al-Awlaki. Ron Wyden has asked for that legal framework for at least nine months.

Wall Street Journal, Key Excerpts from Holder’s Speech on Targeted Killing, Joe Palazzolo, March 5, 2012. Attorney General Eric Holder defended the Obama administration’s use of lethal force on suspected terrorists in a speech this afternoon in Chicago. Holder spent a good portion of it explaining the administration’s legal rationale for targeting a U.S. citizen abroad, as it did in the operation that killed the New MexEric Holderico-born Anwar al-Awlaki, an alleged al-Qaeda operative in Yemen. Below are excerpts from his prepared remarks. "Our legal authority is not limited to the battlefields in Afghanistan....[I]t is entirely lawful – under both United States law and applicable law of war principles – to target specific senior operational leaders of al Qaeda and associated forces. This is not a novel concept....Some have called such operations “assassinations.”  They are not, and the use of that loaded term is misplaced.  Assassinations are unlawful killings.  Here, for the reasons I have given, the U.S. government’s use of lethal force in self defense against a leader of al Qaeda or an associated force who presents an imminent threat of violent attack would not be unlawful — and therefore would not violate the Executive Order banning assassination or criminal statutes."

Eric Holder, Murder is Legal, David Swanson, March 5, 2012. Attorney General Eric Holder on Monday explained why it's legal to murder people -- not to execute prisoners convicted of capital crimes, not to shoot someone in self-defense, not to fight on a battlefield in a war that is somehow legalized, but to target and kill an individual sitting on his sofa, with no charges, no arrest, no trial, no approval from a court, no approval from a legislature, no approval from we the people, and in fact no sharing of information with any institutions that are not the president. In reality, the 2001 authorization to use military force violates the Kellogg-Briand Pact, the UN Charter, and the U.S. Constitution.  It dates to only 10 years ago.  And it is already getting old, as it is becoming harder and harder to accuse people of involvement in the attacks of September 11, 2001.  No international law recognizes secret global war without limitation in time or space.  There is no long established tradition of this madness.  There has never been any type of violence that somebody wouldn't call "defensive," but the traditional right to national military defense applies only to nations being attacked by other nations, and not in a mystical or ideological sense, but actually attacked in the geographic area formerly known as the nation.

Associated Press / Enterprise: Federal sentences still vary widely, Nedra Pickler, March 4, 2012. A new study shows that federal judges are handing out widely disparate sentences for similar crimes 30 years after Congress tried to create fairer results, but the differences don't line up with the party of the president who appointed the judges, despite any impressions that Republicans or Democrats may be tougher or softer on crime. Sentencing data from the past five years that was analyzed for The Associated Press by the Transactional Records Access Clearinghouse during this presidential election year show that sentences for the same types of crimes vary significantly between judges in the same courthouse. On Monday, TRAC planned to launch the first publicly available database of sentencing records, sortable by judge, after a 15-year struggle to get records from a reluctant Justice Department.

Legal Schnazuer, Has the Sexual Abuse of Boys Reached a Crisis Stage? Roger Shuler, March 5, 2012. The most important story of the year might be playing out right now -- and it involves the ongoing revelations about the sexual abuse of boys, allegedly by men who were in positions of trust. The issue first hit the national radar last November, when criminal charges were brought against former Penn State assistant football coach Jerry Sandusky. That quickly was followed by allegations against former Syracuse assistant basketball coach Bernie Fine. Perhaps the most disturbing story yet came last week out of Troy, Ohio -- and it had nothing to do with coaches or sports. It involves a "family unit" that apparently was horrifyingly dysfunctional. An adoptive father has been charged with raping his three sons and using one of them as a prostitute for two other men. The three men are in jail on rape charges.

Harper's No Comment, The United States of Fear: Six Questions for Tom Engelhardt, Scott Horton, March 2, 2012. Tom Engelhardt is a prolific writer and editor, and the curator of TomDispatch, a popular website that presents political commentary. I put six questions to him about his new book, The United States of Fear, in which he projects a fairly gloomy near-term future for an America pulling back from Empire: "In my book, I say that we are now in a “post-legal America” when it comes to the National Security Complex. What that means is simple enough. The U.S. legal system, which still applies to you and me, really no longer applies to the national-security state. What the last decade-plus should have taught anyone working in that world is: no matter how extreme or potentially illegal your actions may be, American justice no longer applies to you. You will never be brought before a court of law, whatever you do. Torture, illegal surveillance, kidnapping terror suspects off the streets of global cities and rendering them to torturing regimes—it really doesn’t matter. It’s as if the mother ship of the national-security complex had simply lifted off from American earth and was now beyond our control. Thought of another way, only one prosecutable crime exists today—under the Espionage Act, no less—for anyone in the complex: whistleblowing. In other words: do what you want, just don’t tell Americans what goes on in these precincts or we’ll take you down."

New York Times, Corporate Abuse Abroad, a Path to Justice Here, Lincoln Caplan, March 3, 2012. The Supreme Court heard arguments last week on this question in a case brought by Nigerian citizens against the Royal Dutch Petroleum Company and other firms, charging gross violations of human rights in Nigeria. Four conservative justices expressed skepticism about the federal courts having the reach to deal with such disputes. But an arcane 1789 law, called the Alien Tort Statute, permits just such lawsuits to be heard in federal courts if brought against individual defendants. The same should hold true for corporations accused of such offenses abroad, provided they have contact with this country, say, by selling products here. In a world where multinational corporations are primary actors, the need for a way to hold them accountable for extreme abuses is more urgent than ever. When corporations do business in America, they have to operate under American law. Providing a forum for victims seeking justice against corporate bad actors is appropriate to America’s history and role in the international community....There is no good justification for a categorical rule against corporate liability. As the economist Joseph Stiglitz said in an amicus brief, these lawsuits can be an efficient way to enforce human rights in countries where court systems and other means of policing violations are ineffective. Potential civil liability gives corporations an incentive to improve their conduct. If a multinational company commits an offense like torture, the fact that it is a corporation and not an individual is immaterial in the pursuit of justice.

UN Office High Commissioner of Human Rights, Corporations must be held accountable for human rights violations, Feb. 20, 2012. The lawsuit, Kiobel v Royal Dutch Petroleum (Shell), was brought in 2002 by 12 Nigerians who allege that the company “aided and abetted” the human rights violations committed against them by the Nigerian Government in the Ogoni region of the Niger Delta. Shell, through a Nigerian subsidiary, was involved in oil exploration and production in the region between 1992 and 1995, at the time the abuses allegedly occurred. This case is one of several brought against Shell in relation to the violent suppression of the Movement for the Survival of the Ogoni people, a group campaigning for the rights of local people and protesting against pollution caused by oil companies. Nine of the Movement’s members, including its leader, well-known writer Ken Saro-Wiwa, were hanged in 1995 after being convicted of murder by a military tribunal. In 2009, after more than a decade in the American courts, Shell settled three of the actions brought on behalf of the widow of Saro-Wiwa and others, offering a total of $15.5 million as compensation to a number of individuals, to cover legal costs of the plaintiffs and to set up a social fund for the community. The company denied that in offering a settlement it was conceding any wrongdoing. The remaining case, Kiobel v Royal Dutch Petroleum, was brought principally on behalf of the widow of another of the ‘Ogoni Nine’, Dr Barinem Kiobel, and 11 others. They sued under a little-used American statute, the Alien Tort Statute of 1789, which gives American courts the jurisdiction to rule on human rights abuses perpetrated against foreign citizens outside the United States.
The specific allegations in the case charge that the Nigerian military and police, with logistical and financial support from Shell, “engaged in a widespread and systematic campaign of torture, extrajudicial executions, prolonged arbitrary detention, and indiscriminate killings constituting crimes against humanity to violently suppress this movement.”