BP's Bid For Extra Proof In Oil Spill Claims Gets Rejected By U.S. Judge

BP's bid of requiring companies to prove that their losses are directly linked to the 2010 massive Gulf of Mexico oil spill before getting a payout has been rejected by a U.S. federal judge, Agence France-Presse reported.

A settlement of $7.8 billion was reached by BP last year with thousands of people and businesses affected by the worst environmental disaster in U.S. history.

The way Patrick Juneau, a court-appointed administrator of claims, has calculated companies' compensation for lost profits has proved to be difficult, AFP reported.

Juneau's methods led to payouts that were too large or improper, said the British energy giant. This proved a challenge in estimating how much BP would have to pay out.

In the appeal, BP argued that some companies asking for payouts should have to show additional proof that their losses were directly linked to the oil spill, according to AFP. Pending a review by District Court Judge Carl Barbier, a New Orleans appeals court froze payments in October.

The settlement negotiated with U.S. authorities and accepted by BP presumed an oil spill link for any losses to businesses within certain geographical zones and in certain sectors, said Barbier in his decision on Tuesday.

According to AFP, supplemental proof would not just be "clearly inconsistent with its previous position, it directly contradicts what it has told this Court regarding causation," he wrote.

Barbier also pointed out that "the delays that would result from having to engage in a claim-by-claim analysis of whether each claim is 'fairly traceable' to the oil spill ... are the very delays that the settlement, indeed all class settlements, are intended to avoid."

But the claims administrator was asked by the judge to review in part his methodology and to define a protocol for when "the claimant's financial records do not match revenue with corresponding variable expenses."

On April 20, 2010, an explosion on the Deepwater Horizon rig some 50 miles from New Orleans killed 11 workers and spilled oil for 87 days until it was plugged.

Beaches in five states were blackened and the region's tourism and fishing industries were crippled in a tragedy that shocked the United States, AFP reported.