[Vision2020] BP May Face Manslaughter Charges Over Gulf Oil Spill

Tom Hansen thansen at moscow.com
Wed Mar 30 06:12:49 PDT 2011


Courtesy of Bloomberg at:

http://www.bloomberg.com/news/2011-03-29/bp-managers-said-to-face-u-s-review-for-manslaughter-charges.html

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BP Managers Said to Face U.S. Review for Manslaughter Charges

Federal prosecutors are considering whether to pursue manslaughter charges
against BP Plc (BP/) managers for decisions made before the Gulf of Mexico
oil well explosion last year that killed 11 workers and caused the biggest
offshore spill in U.S. history, according to three people familiar with
the matter.

U.S. investigators also are examining statements made by leaders of the
companies involved in the spill -- including former BP Chief Executive
Officer Tony Hayward -- during congressional hearings last year to
determine whether their testimony was at odds with what they knew, one of
the people said. All three spoke on condition they not be named because
they weren’t authorized to discuss the case publicly.

Charging individuals would be significant to environmental- safety cases
because it might change behavior, said Jane Barrett, a law professor at
the University of Maryland.

“They typically don’t prosecute employees of large corporations,” said
Barrett, who spent 20 years prosecuting environmental crimes at the
federal and state levels. “You’ve got to prosecute the individuals in
order to maximize, and not lose, the deterrent effect.”

BP fell 2.2 percent in London trading to 466.55 pence, the steepest drop
since January. The shares have rebounded from a post-spill intraday low of
296 pence on June 25.

Criminal and Civil
The Justice Department in June said it opened criminal and civil
investigations into the spill, which began after an April 20 explosion
aboard the Deepwater Horizon rig that London-based BP leased from
Transocean Ltd. (RIG), of Vernier, Switzerland. The department filed a
civil suit against BP in December and hasn’t filed criminal charges. It’s
continuing to investigate.

Authorities are examining actions by BP managers who worked both on the
rig and onshore to determine whether they should be charged in connection
with the workers’ deaths, according to the people. Prosecutors have been
looking at charges of involuntary manslaughter or seaman’s manslaughter,
which carries a more serious penalty of up to 10 years.

Scott Dean, a spokesman for BP in Houston, declined to comment. Laura
Sweeney, a Justice Department spokeswoman, wouldn’t discuss the details of
the investigation.

Committing $20 Billion
BP has committed $20 billion to settle claims by businesses and
individuals who were hurt by the oil spill. The company has already paid
out more than $4 billion to settle such claims and to pay state, local and
federal governments for cleanup costs, response and losses, the company
said on its website.

The manslaughter investigation is focusing on decisions by BP managers
leading up to the explosion that may have sacrificed safety in favor of
speed and cost savings, one of the people said.

David Uhlmann, a former chief of the Justice Department’s environmental
crimes section, said he expected that companies involved in the spill
would be charged with seaman’s manslaughter. Making a case against
individual managers would be more difficult, he said.

“You have relatively low-level people in these companies responsible for
making bad decisions,” said Uhlmann, who now teaches at the University of
Michigan Law School in Ann Arbor. “It’s not clear they had adequate
training. It’s not clear they all knew what everyone else involved knew.”

Environmental Violations
Attorney General Eric Holder in June listed a number of potential
environmental violations under review in the criminal and civil
investigations, including of the Clean Water Act. Holder, in his
statement, didn’t specifically mention the possibility of manslaughter
charges.

Investigators are scrutinizing e-mails and other documents to determine
what BP officials and the company’s drilling partners knew when they
testified before Congress in June and whether they withheld information,
one of the people said.

When Hayward, who lost his job after the spill, testified before a House
panel, one lawmaker said he wasn’t being forthcoming.

“I expect you to cooperate with us,” Representative Henry Waxman, a
California Democrat, told Hayward at the hearing. “Are you failing to
cooperate with other investigations as well? Because they’re going to have
a hard time reaching conclusions if you stonewall them.”

Hayward denied he was stonewalling and said he wasn’t involved in
decisions about the well’s operation.

Justice Task Force

The investigation is being conducted by a task force within the Justice
Department’s criminal division following a move this month to consolidate
management of the probe. It’s being run by John Buretta, a senior counsel
in the criminal division. Until then, the environment and natural
resources division was running the bulk of the criminal case.

Environmental lawyers and lawyers from the U.S. attorney’s office are
reporting to Buretta in the probe.

James Cole, the deputy attorney general, said he decided to consolidate
the case to ensure “we used all the resources we had the most effective
way we could.”

“I felt that the most effective way to proceed with this case was to
combine the efforts into one group,” Cole said in an interview. “The focus
of the case is the same. It’s just under different organization.”

Before the change, the criminal division had been focusing on whether BP
made misleading statements after the spill and company executives traded
stock based on insider information, two people familiar with the matter
said. The environment division’s criminal lawyers had been examining
violations of environmental laws, along with manslaughter, the people
said.

Cole declined to discuss specifics of the probe.

‘Lot of Investigation’
“There is a lot of investigation yet to be done,” he said. “It’s going to
head wherever the law and the facts take it.”

Authorities are focusing on events leading up to the explosion of the well
as BP and Transocean workers were trying to seal it. The companies wanted
to move the Deepwater Horizon drilling rig and replace it with a
production rig that would pump oil and gas from the ground.

The companies had struggled with the well for months because the rock
formation surrounding the oil and gas repeatedly cracked and collapsed on
the hole they were drilling. In the week before the disaster, BP officials
made repeated changes to the well plan, according to testimony in Coast
Guard hearings, internal documents and investigation reports.

Obama Commission
A commission appointed by President Barack Obama to investigate the
disaster identified 11 choices made in the completion of the well that
both saved time and increased risks. Seven were made by BP managers on
shore, the panel said.

The decisions included moving ahead with operations without the
recommended equipment, failing to run a test to ensure the well’s
stability, and misreading the results of other tests.

In the days leading up to the disaster, BP officials were warned by
Halliburton Co. (HAL), the Houston-based company it hired to seal the well
with cement, that their design might allow the oil and natural gas to leak
to the surface.

Halliburton recommended BP use 21 centralizers that help ensure cement is
evenly distributed in the well and seals it. BP had only six centralizers
on Deepwater Horizon, according to internal e-mails released by
investigators. BP officials decided to go ahead rather than wait for the
additional 15.

They also decided to skip a test that would determine if the cement was
stable, according to testimony at Coast Guard hearings. Then, on April 20,
BP and Transocean managers on the rig misread the results of another test
to determine whether the well’s cement seal was strong enough to hold the
oil and natural gas beneath the ocean floor, according to the president’s
commission.

In the end, the companies went ahead and removed the drilling mud from the
well, which took 2,600 pounds of weight from atop the oil and gas
reservoir. Within hours, natural gas reached the Deepwater Horizon and
touched off the catastrophic explosion.

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Seeya round town, Moscow.

Tom Hansen
Moscow, Idaho

"The Pessimist complains about the wind, the Optimist expects it to change
and the Realist adjusts his sails."

- Unknown




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