Annual Institute on Mineral Law Volume 58 The 58th Annual Institute on Mineral Law Article 7 3-24-2011 The BP Oil Spill and the Future of Mass Tort Litigation Linda S. Mullenix Follow this and additional works at: http://digitalcommons.law.lsu.edu/mli_proceedings Part of the Oil, Gas, and Mineral Law Commons Repository Citation Mullenix, Linda S. (2011) "The BP Oil Spill and the Future of Mass Tort Litigation," Annual Institute on Mineral Law: Vol. 58 , Article 7. Available at: http://digitalcommons.law.lsu.edu/mli_proceedings/vol58/iss1/7 This Paper is brought to you for free and open access by the Mineral Law Institute at LSU Law Digital Commons. It has been accepted for inclusion in Annual Institute on Mineral Law by an authorized editor of LSU Law Digital Commons. For more information, please contact [email protected]. Mullenix: The BP Oil Spill and the Future of Mass Tort Litigation The BP Oil Spill and the Future of Mass Tort Litigation Linda S. Mullenix Morris & Rita Atlas Chair in Advocacy University of Texas School ofLaw Austin, Texas I. Introduction In the well-known Greek myth, Prometheus stole fire from the Greek god Zeus and gave it to humanity. In return for this arrogance, Zeus had Prometheus chained to a rock in the Caucasus mountains, where Prometheus was punished by an eagle eating away at his liver, which was regenerated every night. Because Prometheus was immortal, he was condemned to eternal torture by the voracious eagle's pecking. After thirty years of this punishment, however, Hercules appeared, killed the eagle, and liberated Prometheus from his unending torment. In return for freeing him, Prometheus rewarded Hercules with the secret to completing the eleventh of his famous Herculean labors.' On April 20, 2010, an explosion on the Deepwater Horizon rig killed eleven workers and unleashed the reputed worst oil spill in American history. Less than two months later, on June 16th, 2010, BP Oil-after meeting with President Barack Obama-agreed to set up a $20 billion dollar fund to compensate victims of the disaster. Shortly thereafter, BP selected Kenneth Feinberg to oversee the compensation fund and claims process. In the morality play of the Deepwater Horizon oil spill, BP Oil assumed the Promethean role of modern energy-bringer to mankind. In its arrogance for attempting to expropriate energy from miles below the ocean floor and bring oil to mankind, BP precipitated a massive calamity. As a consequence, BP faced the eternal punishment of being lashed to the American Caucasus of never-ending civil litigation, perpetually to be pecked away by claimants. Rather than endure this interminable retribution, BP instead chose to terminate its own agony as quickly as possible by creating a Fund. And, Hercules-in the form of the heroic Ken Feinberg-appeared to BP just in time to slay the civil litigators and liberate BP. For his efforts at enabling the BP rescue, BP rewarded Ken Feinberg.2 Prometheus gave Hercules the secret to stealing the golden apples from the Hesperides. 2 By my somewhat inexpert count, Ken Feinberg might well be performing approximately his seventh Herculean labor, with his preceding feats consisting of his participation as a special master in: (1) negotiating the Agent Orange class action settlement, (2) as a trustee charged with disbursing Dalkon Shield settlement payments, (3) assisting Judge Jack Weinstein of the Federal District Court for the Eastern District of New York in the Brooklyn Navy Yard asbestos cases, (4) managing the WTC Victim's Compensation Fund, (5) determining Wall Street executive salary compensation under Troubled Assets Relief Program, (6) supervising the Hokie Spirit Memorial Fund after - 20 - Published by LSU Law Digital Commons, 2011 1 Annual Institute on Mineral Law, Vol. 58 [2011], Art. 7 The appearance of Ken Feinberg as the heroic savior in the Gulf oil calamity was, in no small measure, a consequence of a persona whose reputation has indeed assumed mythic proportions in the public consciousness.3 As is well-known, Ken Feinberg served as the special master administering the World Trade Center Victims' Compensation Fund in the aftermath of the terrorist attack on the Twin Towers on September 11, 2001.4 As is equally well-known, Ken Feinberg also has had an extended career serving as a mediator, special master, settlement negotiator, claim3 administrator, and more recently, as President Barack Obama's Wall Street executive compensation czar. The selection of Ken Feinberg to administer the Gulf Coast Claims Facility immediately commanded comparison to the World Trade Center Victims' Compensation Fund. Indeed, Feinberg himself announced that in administering :he Gulf Coast Claims Facility, he would be drawing on his vast knowledge and experience in administering the World Trade Center Victims' Compensation Fund.6 Many of Feinberg's initial initiatives-such as town hall meetings and outreach to Gulf fishermen and other claimants-duplicated techniques that Feinberg had developed during his supervision of the World Trade Center Fund. the Virginia Tech campus shootings, and (7) administering the Gulf Coast Claims Facility. See Jeff McDermott, Kenneth Feinberg: A Profile in Public Service, 55 Fed. Law. 38 (May 2008). See Steven Brill, Wiat's a Bailed-Out Banker Really Worth?, N.Y. Times Mag. 32 (Jan. 2010) (profile of Ken Feinberg's role as executive pay czar under the federal Troubled Asset Relief Program); Terry Carter, The Master of Disasters: Is It Just Him, or is Kenneth Feinberg Cangingthe Course of Mass Tort Resolution, ABA J. 33 (Jan. 2011); Kimberley A. Strassel, Mr. Fairness: The Pay Czar, BP Claims Administrator,and 9/11 Victims Fund Manager Talks About How He Makes Decisions That Alter Lives, W.S.J. (Aug. 7, 2010), avai able at http://online wsj.com/article (comparing Feinberg to King Solomon). 4 See Kenneth R. Feinberg et al., FINAL REPORT OF THE SPECIAL MASTER FOR THE SEPTEMBER I ITH VICTIM COMPENSATION FUND OF 2001 (2004), available at http://www.usdoj.gov/finalreport.pdf (hereinafter "FINAL REPORT OF THE SPECIAL MASTER"). s Janet Cooper Alexander, Procedural Design and Terror Victim Compensation, 53 DePaul L. Rev. 621, 667 (2003); Martha Chamallas, The September 11th Victim Compensation Fund: Rethinking the Damages Element in Injury Law, 71 Tenn. L. Rev. 51, 56 (2003); Charles J. Faruki, What Is a Life Worth?: The Unprecedented Effort to Compensate the Victims of 9/11, Fed. Law. 52 Oct. 2005 (book review); McDermott, Kenneth Feinberg, supra; Strassel, Mr. Fairness, supra n. 3. 6 See Strassel, Mr. Farness,id. 7 See Kenneth Feinterg, Transparency and Civil Justice: The Internal and External Value of Sunlight, 53 DePaul L. Rev. 473 (2003); Feinberg Says BP Fund Will Be Generous, Better Than Lawsuits, Bloomberg News (July 15, 2010), available at http://businessweek.com/news/2010-07-15/feinberg-says-bp-fund-will-be-generous (local meeting in Jefferson Parish, Louisiana); Wendy Kaufman, Feinberg Vows Quick Response on Gulf Oil Spill Claims, NPR Interview (Aug. 19, 2010), available at http://www.npr.org/ (Feinberg meeting in Houma, Louisiana). -21- http://digitalcommons.law.lsu.edu/mli_proceedings/vol58/iss1/7 2 Mullenix: The BP Oil Spill and the Future of Mass Tort Litigation But, the BP Gulf Coast Claims Facility-apart from its superficial designation as a compensation fund-bears little resemblance to the World Trade Center Victims' Compensation Fund. Although these two "fund" mechanisms have in common the same all powerful administrator, the two funds are entirely unlike one another. And this comparison bears scrutiny and debate, for several compelling reasons. First, the World Trade Center Victims' Compensation Fund was widely acknowledged as a sui generis, one-time endeavor to compensate victims of a national terrorist disaster.8 Indeed, the special master Ken Feinberg repeatedly stressed in numerous speeches and writings that the World Trade Center Victims' Compensation Fund was neither a model for tort reform, nor a model for any future terrorist or other disaster.9 Ken Feinberg was fairly and consistently insistent that the WTC Fund was not 8 See e.g., Feinberg et al., FINAL REPORT OF THE SPECIAL MASTER at 83-84; Ackerman, The September 11th Victim Compensation Fund; An Effective Administrative Response to National Tragedy, 10 Harv. Negotiation L. Rev, 135, 205 (2005) ("Because the Fund is sui generis, it is unlikely to have a profound impact on developments in the law of torts); Chamallas, The September 11th Victim Compensation Fund at 53 (2003) ("Perhaps the most repeated observation made about the September 1Ith Compensation Fund, like the horrible events which brought it into being, is that it is unique and has no close parallel in the history of United States injury and compensation law."): Erin G. Holt, Note: The September 11th Victim Compensation Fund: Legislative Justice Sui Generis, 59 N.Y.U. Ann. Sur. Am. L. 513, 539-40 (2004); Robert S. Peck, The Victim Compensation Fund: Born From a Unique Confluence of Events Not Likely to Be Duplicated,53 DePaul L. Rev. 209 (2003) (comparing the World Trade Center events to the attack on Pearl Harbor on December 7, 1941); Robert L. Rabin & Stephen D. Sugarman, The Casefor Specially Compensating the Victims of Terrorist Acts: An Assessment, 35 Hofstra L. Rev. 901, 907 (2007) ("9/11 was the quintessential once-in-a-lifetime disaster'); Robert L. Rabin, The September 11th Victim Compensation Fund: A CircumscribedResponse or an Auspicious Model?, 53 DePaul L. Rev. 769, 771 (2003). But see Michele Landis Dauber, The War of 1812, September 11th, and the Politics of Compensation, 53 DePaul L. Rev. 289 (2003) (arguing that the WTC Victim Compensation Fund was not unprecedented; the federal government historically has been involved in compensating victims of various types of calamities, including other victims of terror).