Engineering News

Judge To Determine If BP Fine Is Sufficient
Thursday, July 17, 2008

A federal judge will examine medical bills and lost wages of people who died or were hurt in the 2005 explosion at BP's Texas City refinery to help determine whether a $50 million fine to resolve criminal liability is sufficient.

U.S. District Judge Lee Rosenthal on Wednesday told attorneys representing blast victims, the government and BP that she needs that information before she can accept or reject the company's plea deal forged last October.

"I'm not telling you what the fine should be. That's not my business," Rosenthal said at a hearing. "This is just to make sure it is not unreasonably low."

Specifically, she will examine economic losses of the 15 people who died as well as those of 35 others selected by lawyers for the victims. She will use those figures to estimate how tangible victim losses compare to the proposed fine.

She will not consider noneconomic losses, such as payments to settle civil litigation that compensated for mental anguish or pain and suffering.

Rosenthal scheduled a hearing for Oct. 7 -- nearly a year after BP and the government unveiled the proposed plea deal.

The $50 million fine is part of the deal, which also calls for the company's North American products division, which oversees U.S. refineries, to plead guilty to a felony violation of the Clean Air Act and be on probation for three years.

The plea deal has been in limbo for months as blast victims sought to convince Rosenthal and then an appeals court panel to toss it aside. The 5th U.S. Circuit Court of Appeals panel ruled in May that the deal was reached in violation of blast victims' rights to be consulted under a 2004 law, but the court handed it back to Rosenthal to accept or reject rather than order her to throw it out.

Keith Casey, the plant's current manager, entered the plea on BP's behalf in February. At the same hearing, several victims implored Rosenthal to reject the deal as too lenient for the carnage the disaster caused.

BP lawyer Mark Holscher said Wednesday that the company will cooperate with victims' lawyers in providing the information Rosenthal requested but noted that the rules are different in civil and criminal courts.

Burden of proof argument He said that if Rosenthal considers victims' economic losses in deciding whether to accept or reject the plea deal, that information has to be solid enough to meet standards of proof in a criminal trial. In the civil cases where the information was gathered, the burden of proof is less stringent, he said.

Therefore, any estimate of overall economic losses that Rosenthal derives from the 15 people who died and a sampling of other victims "would be what you think could be proved beyond a reasonable doubt" -- the burden of proof in criminal cases, Holscher said.

Rosenthal acknowledged Holscher's concern but noted she was just seeking information to help her evaluate the proposed $50 million fine.

Rosenthal told victims in February that she cannot just toss out the deal and impose her own. She said she can only rule on whatever proposed deal attorneys present to her.

Also Wednesday, Rosenthal said she would address the victims' concern that the company isn't complying with the proposed terms of probation.

Those terms require BP to comply with blast-related settlements with the U.S. Occupational Safety and Health Administration and the Texas Commission on Environmental Quality that include, in part, regular safety audits.

Lack of audits, lawyer says Ed Mallett, a lawyer for the victims, said the OSHA agreement requires independent audits of the plant every six months, but BP has conducted fewer such audits -- which involve employees working with the independent firm AcuTech Consulting.

Mallett said a process safety expert who has testified about these alleged compliance failures in an ongoing blast-related civil trial in Galveston can give the same testimony in Rosenthal's court as well.

Holscher and Assistant U.S. Attorney Mike McIntyre said OSHA and the Texas Commission on Environmental Quality say BP is in compliance.

But Rosenthal said that she will examine an AcuTech report and consider whether testimony is necessary.

"The victims have raised the challenge. It is my obligation to consider that challenge," she said.

Source: Houston Chronicle

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