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BP expands challenge to Gulf spill settlement

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Associated Press

NEW ORLEANS (AP) - BP is trying to convince a federal appeals court that it should throw out a judge's approval of the company's multibillion-dollar settlement related to the Gulf oil spill if a separate appeal is unsuccessful.

Last year, BP joined plaintiffs' attorneys in urging U.S. District Judge Carl Barbier to give his final approval to its settlement with Gulf Coast businesses and residents who claim the spill cost them money.

On Friday, however, the company's lawyers argued in a court filing that Barbier's more recent interpretation of settlement terms has allowed businesses to receive hundreds of millions of dollars for inflated or fictitious claims.

In July, BP asked a three-judge panel from the 5th U.S. Circuit Court of Appeals to overturn Barbier's rulings governing business payouts.

BP says it would still support Barbier's approval of the settlement if that separate appeal is successful. But if the panel upholds the judge's interpretation, "then the settlement would be rendered wholly unfair, irrational, and constitutionally suspect," company lawyers wrote.

BP spokesman Geoff Morrell said the settlement has been "wrenched from reality and no longer resembles the deal to which we have agreed."

"Under the misinterpretation, awards are based on the way in which claimants maintained their books, even if the books contain uncorrected errors," Morrell said in a statement. "As a result, compensation is completely unhinged from and not proportionate to actual injury."

Plaintiffs' lawyers who brokered the deal have argued that BP undervalued the settlement and underestimated how many claimants would qualify for payments.

"BP may be committed to 'making things right' for its stockholders, but despite the millions spent on misleading ads, when forced to actually be honest about its intentions, BP tells the court that it has no plans to stand by the transparent, objective agreement that it negotiated, signed, and asked the court to approve," Steve Herman, one of the lead plaintiffs' attorneys on the case, said in a statement issued Friday afternoon.

BP's appeal didn't apply to payouts to individuals.

If the 5th Circuit reverses Barbier's approval of the settlement, court-supervised claims administrator Patrick Juneau's office would continue to process claims that already have been submitted.

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