D&G Law

BP Oil Spill Settlement & Alabama Businesses

A number of our business clients and friends have been asking about the BP Oil Spill Settlement and whether they can be compensated even if they don’t think¬† their business was hurt by the spill or if they are located in the northern part of the state away from the coast.

The lawyer ads have been running on TV and across social media, and they sound almost too good to be true – but they largely are, in fact, true. Any business in Alabama – from the coast all the way to Tennessee – that meets certain business-friendly criteria is eligible to be paid under the settlement.

Business do NOT have to show that any downturn they experienced during 2010 (when the spill occurred) was due to the oil spill. Rather, if your business had a downturn in any 3 month period from May to December of 2010 versus either (a) the same 3 months in the prior year (2009), or (b) the average of the same 3 months in 2008 and 2009, or (c) the average of the same 3 months in 2007, 2008 and 2009, the settlement presumes that your downturn was due to the spill. And if you think about it, it very may well have been. The spill took an awful toll on the coast and on businesses that dealt with coastal residents or businesses or travelers, and much of that toll trickled through the rest of the state. Deliveries were delayed. Energy prices were affected. The spill generally slowed business throughout the region.

If your business meets this test (or some others in the agreement), you are eligible to recover 125% or more of your lost profits in 2010. Businesses have even more flexibility for choosing the periods during 2010 for which they seek compensation.

The settlement includes alternative methods of establishing a claim that are more complicated. So even if your business does not meet the test above, you may still qualify for settlement funds, especially if you lost any contracts due to the spill or are located on the coast.

If you think your business might qualify for a share of the settlement, or if you just don’t know and want to find out, our firm is helping our clients through the process.