NEW ORLEANS (AP) — A federal judge has scheduled a hearing Friday on BP’s bid to temporarily block settlement payments to Gulf Coast businesses and residents who claim they lost money after the company’s 2010 oil spill.
On Tuesday, BP asked U.S. District Judge Carl Barbier to suspend the payments while former FBI Director Louis Freeh investigates alleged misconduct by a lawyer who helped administer the multibillion-dollar settlement program.
Last month, court-appointed claims administrator Patrick Juneau announced that his office is investigating allegations that a former staff attorney, Lionel H. Sutton III, received a portion of settlement proceeds for claims he had referred to a law firm before he started working on the settlement program.
Barbier appointed Freeh on July 2 to investigate the allegations and take a broader look at the program.
BP PLC argued in a court filing Tuesday that it shouldn’t be required to take the risk that hundreds of millions of dollars in claims payments could be “tainted by fraud, corruption and malfeasance.”
In April, Barbier refused to block what could be billions of dollars of payments to businesses after BP argued that he and Juneau have misinterpreted the settlement and forced the company to pay for inflated and fictitious losses. Barbier, who appointed Juneau, upheld his interpretation of settlement terms governing payments to businesses.
BP appealed that decision. A three-judge panel from the 5th U.S. Circuit Court of Appeals heard the case last Monday. The panel didn’t indicate how soon it would rule.