FACT SUMMARY After the Deepwater Horizon explosion and spill affected the health and economic well-being of Gulf Coast residents, hundreds of lawsuits were filed against BP. In August 2010, the Judicial Panel on Multidistrict Litigation centralized all federal actions in the U.S. District Court for the Eastern District of Louisiana pursuant to federal statutes. Eventually, hundreds of cases with thousands of individual claimants would be consolidated with this multidistrict litigation. The parties engaged in an extraordinary amount of discovery within a compressed time period to prepare for trial. This included taking 311 depositions, producing approximately 90 million pages of documents, and exchanging more than 80 expert reports. Depositions were conducted on multiple tracks and on two continents. In February 2011, settlement negotiations began in earnest for the proposed settlement agreement, and by September 2012 both parties moved for final approval from the court. The court ordered a Fairness Hearing in order to determine approvability of the agreement. Some plaintiffs argued that it was not fair that BP would obtain a broad class wide release as well as a signed individual release from each claimant that accepts a payment pursuant to the settlement agreement. SYNOPSIS OF DECISION AND OPINION In a lengthy opinion, the court ruled that the proposed settlement agreement was fair and approved it. The court pointed out that the agreement included extensive compensation for individual and business losses, including compensation for claims related to property damage, economic losses of fisheries and other small businesses on the coastline, the rebuilding of wetlands, and vessel repair, as well as compensation for other losses caused by the spill. The court also found that the agreement created an effective method for advertising news of the settlement to affected residents and businesses and provided an infrastructure designed to pay claims quickly. WORDS OF THE COURT: Fair Settlement Proponents of a class settlement must show by a preponderance of the evidence that the settlement is fair, reasonable, and adequate. The Fifth Circuit has articulated six factors to guide a courts review of whether a settlement is fair, reasonable, and adequate: (1) the existence of fraud or collusion behind the settlement; (2) the complexity, expense, and likely duration of the litigation; (3) the stage of the proceedings and the amount of discovery completed; (4) the probability of plaintiffs success on the merits; (5) the range of possible recovery; and (6) the opinions of the class counsel, class representatives, and absent class members. Because the public interest strongly favors the voluntary settlement of class actions, there is a strong presumption in favor of finding the settlement fair, reasonable, and adequate. The preference for settlement over the expenditure of scarce judicial resources gains added force under the OPA statute, which is designed to catalyze settlements.

1. Do you agree with the court that the public interest is served best by settlement in these kinds of cases? Why or why not?

2. What is a fair sum to pay business owners who suffered damages through loss of tourism because of the spill? Isnt it impossible to determine how much a particular business could have made?