Two businesses trying to get settlement money sooner from the BP oil spill litigation hit a dead end at a federal appeals court this week.
A three-judge panel of the U.S. 5th Circuit Court of Appeals dismissed the effort by Rocon Inc. and Benny Whitehead Inc., both plaintiffs in the massive 2012 BP oil spill settlement. The companies had argued that federal rules governing out-of-court settlement negotiations require that they be paid immediately.
Oil spill payments to thousands of businesses were put on hold from October 2013 through May 2014 as BP challenged the settlement program in court. Despite the hold being lifted this year, Rocon and Benny Whitehead say they have yet to receive any money, according to court records.
Rocon and Whitehead asked U.S. District Carl Barbier in New Orleans to order payment immediately under federal arbitration law, which Barbier denied.
The law, known as the Federal Arbitration Act, allows private disputes to be settled outside of court with the help of an arbitrator. Once an award is settled on, a judge confirms the terms and orders payment. A settlement must be confirmed within one year of a request. Rocon and Benny Whitehead argued the payment hold denied their right to confirmation.
The 5th Circuit panel, though, said Barbier did not directly mention or make reference to federal arbitration law in denying the companies' arguments. Therefore, the panel said, the 5th Circuit has no jurisdiction to rule on the issue, the basis of the companies' appeal.
Business payments under the settlement deal are now moving forward, though many claimants report continued delays.
The court in May approved a revised policy for calculating losses under the settlement that could further delay or, in some cases, lower payments as its implemented.
BP is now asking the U.S. Supreme Court to hear its appeal of the settlement.