Gov. Bob Riley: No lawsuit waiver on final oil spill claims

Published: Saturday, December 11, 2010, 5:00 AM

Alabama Gov. Bob Riley urged BP PLC and President Barack Obama to make sure that Gulf Coast residents don’t have to sign liability waivers to accept claims payments.

Oil spill claims czar Ken Feinberg recently launched the second stage of his claims process, in which he will offer people final settlements or interim quarterly payments.

The final settlements require the claimant to sign a release and covenant not to sue BP and other parties, while the interim payments do not.

In letters to the president and to BP Chief Executive Officer Robert Dudley, Riley said that the waiver that people are being asked to sign upon their acceptance of a final settlement from Ken Feinberg’s Gulf Coast Claims Facility is “over-broad and simply unconscionable.”

Riley’s complaints are that the release:

• Waives liability not just for BP, but for “anyone who is or could be responsible or liable in any way for the incident.”

• Requires the claimant to promise that his spouse, heirs, parents, partners and others won’t sue on his or his affiliates’ behalf.

• Frees BP and others from all claims and liabilities, not just those covered by the claims facility.

“If BP wishes to disclaim responsibility for this outrageous demand, the simple and credible response would be to tell Mr. Feinberg not to do it,” Riley said in the letter to Dudley. “If BP believes it is entitled to this unfair advantage, then stop telling the victims of your oil spill that you are going to tirelessly ‘make this right.’”

Feinberg, through a spokeswoman, declined to comment. BP and the White House could not be reached for comment Friday night.

Gulf Shores Mayor Robert Craft, when told of Riley’s request to rid the final claims process of the release, said that the interim claims option is enough to ensure protection for claimants’ rights.

“I don’t know that it’s reasonable to ask for a final claim without releasing them,” Craft said.

Riley is joining a large chorus of public officials who have criticized the Feinberg’s liability release.

Alabama Attorney General Troy King has attacked the idea of a release of liability since it was first proffered in the summer. Mississippi Attorney General Jim Hood on Monday said he believes that the language in the waiver is unfair. U.S. Assistant Attorney General Tom Perrelli criticized the release last month because it required people to release BP from behavioral health claims, although the claims operation is not writing checks for those.

Feinberg responded to Perrelli’s criticism by amending the waiver to stipulate that it does not apply to claims for bodily injury.

Riley wants Feinberg to take it a step further.

“BP should instruct Mr. Feinberg not to require releases for claims payments, including payments characterized as ‘final,’” Riley said in his letter to Dudley. “If a release is absolutely necessary, write one that is limited to the person making the claim, the company paying the claim, the damages asserted in the claim, and the information available as of submission of the final claim.”

Feinberg took over the claims process for individuals and businesses on Aug. 23. He plans to end on Wednesday the first phase of the operation, in which he made emergency payments worth up to six months of losses without requiring any waiver. He has given out more than $2.4 billion in emergency payments across the Gulf Coast.

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Lottery officials named in lawsuit

Bridgette Frazier, a former staff attorney for the Arkansas Lottery Commission, sued the Commission, director Ernie Passailaigue and deputy director Ernestine Middleton in federal court today over her forced resignation Nov. 19, 2009.

Frazier, represented by rising state Rep. John Wallker, alleges that she was fired in violation of her First Amendment rights for expressing concerns about lottery personnel practices to the attorney general's office. She said she was denied due process in her forced termination. She accuses Passailaigue and Middleton of making defamatory remarks about her after her departure. The suit seeks reinstatement, back pay, $500,000 in compensatory damages and punitive damages.

The lawsuit describes a disorderly office, indiscreet conversations about employees and tangled lines of authority. The last year has featured a damning audit of the lottery, legislator unhappiness, wildly improper time-off awards to highly paid employees and other controversies. They tend to lend circumstantial support to Frazier's claims. When she left her $105,000-a-year job, lottery officials left the impression she'd departed for raising questions about merit pay raises. The lawsuit explains that query in much fuller detail. She said the Department of Finance had informed the Lottery Commission about the possibility of merit pay and the need for employee evaluations for Frazier and others. Frazier said she agreed with a supervisor's decision that merit pay wasn't necessary, but that rules required evaluations.

Here's the complaint. Note that Walker describes Passailaigue and Middleton as South Carolina residents, though together they are knocking down between $500,000 and $600,000 a year as top employees of a state agency. Not for this lawsuit alone do you have to wonder how long they'll remain Arkansas residents, nominal or otherwise.

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