On September 4, 2014, U.S. District Court Judge Carl Barbier issued a ruling holding that BP Exploration & Production Inc. is subject to enhanced civil penalties under the Clean Water Act (CWA) because the deadly April 20, 2010 blowout, explosion, fire and massive oil spill at the Macondo well in the Gulf of Mexico was due to BP's gross negligence and willful misconduct. Thousands of cases involving over a hundred thousand claimants have been filed in federal and state courts. The case is In re: Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico, on April 20, 2010. The Court's ruling is very long (over 150 pages), and consists of an exhaustive account of the accident, and well as Findings of Fact and Conclusions of Law.
In addition to findings regarding BP's culpability, the Court held that Transocean, the drilling contractor, and Halliburton Energy Services, which was engaged to provide well cementing and mud logging services, were also negligent. BP was apportioned 67% of the fault, Transocean 30%, and Halliburton 3%. The other parties to the litigation entered into comprehensive settlements several months ago.
The Court noted that neither the CWA nor the Oil Pollution Act define the terms "gross negligence" or "willful misconduct", the terms that are used to assess enhanced civil liability for such oil spills. In the context of this case, where the magnitude of potential harm to persons, property and the environment resulting from a massive oil spill is so great (millions of gallons of oil were released over a period of almost three months), the Court agreed with the United States that "gross negligence" would be an extreme departure from the standard of care required under the circumstances, or even a failure to exercise even slight care. While the Court concluded that the element of "recklessness" is not a component of gross negligence, he nevertheless reviewed the events leading up to the blowout through the prism of "recklessness" because of a recent Fifth Circuit CWA civil damages case, U.S. v. Citgo Petroleum Corp., 723 F. 3d 547 (2013).
The Court focused on the failure of BP personnel on board the Deepwater Horizon or located at BP's onshore monitoring facilities to prudently conduct and interpret the results of a "negative pressure test" on the Deepwater Horizon's drill pipe or "kill line"(and BP was vicariously liable for their actions). An accurate application and interpretation of the data generated by the negative pressure test would have disclosed that the well itself was "in communication" with the oil-bearing formation, which was very dangerous under these conditions. The Court agreed with the Government that the proper conduct of a negative pressure test before the completed well was temporarily abandoned was absolutely vital. BP's misinterpretation of the data masked the failure of the cementing function, which ultimately caused the blowout and explosion because the oil coursed through the drill pipe onto the deck of the Deepwater Horizon, where it was ignited. In the Court's opinion, BP was principally responsible for this negligent and reckless act.
The Court also listed a number of other negligent or questionable actions taken or prompted by BP that, in its view, "together amount to gross negligence or willful misconduct" under the CWA. The Court noted that the project was millions of dollars over budget, and well behind schedule--BP intended to employ the Deepwater Horizon at a number of other drilling locations.