- Dixey
BP Track Record
BP Track Record
Civil Action Suit – UNITED STATES OF AMERICA,PLAINTIFF,v. AIG TRADING
CORPORATION; BP EXPLORATION & OIL INC.; and CARGILL INTERNATIONAL, S.A.
Defendants.
Beginning at least as early as July 1992, and continuing at least until May
1993, the exact dates being unknown to the United States, the defendants and
their co-conspirators engaged in a combination and conspiracy in
unreasonable restraint of interstate trade and commerce in violation of
Section 1 of the Sherman Act, as amended (15 U.S.C. § 1). This unlawful
combination and conspiracy may be renewed unless the relief prayed for
herein is granted.
http://www.justice.gov/atr/cases/f1300/1345.htm
*
FEBRUARY 7, 1995 – BRITISH PETROLEUM AGREES TO PAY $3.9 MILLION FOR 1990
CALIFORNIA OIL SPILL (tanker accident)
http://www.justice.gov/opa/pr/Pre_96/February95/72.txt.html
*
MARCH 15, 1999 – BP OIL MUST MONITOR FLARING OF GASES AT TOLEDO REFINERY.
Company To Also Pay $1.75M To Settle Environmental Charges.
http://www.justice.gov/opa/pr/1999/March/092enr.htm
*
SEPTEMBER 23, 1999 – BP Exploration [Alaska] Pleads Guilty To Hazardous Substance Crime. Will Pay$22 Million, Establish Nationwide Environmental Management System.
http://www.justice.gov/opa/pr/1999/September/437enr.htm
*
APRIL 11, 2000 – BP AMOCO AGREES TO PAY $32 MILLION TO RESOLVE CLAIMS OF
UNDERPAYMENT OF OIL ROYALTIES. BP Amoco has agreed to pay $32 million to
resolve claims under the False Claims Act and administrative claims that the
corporation underpaid royalties due for oil produced on federal and Indian
leases since 1988, the Justice Department announced today. BP Amoco, which
is based in Chicago, was created in 1998 by the merger of Amoco Corporation
of the United States and the British Petroleum Company p.l.c. of the United
Kingdom.
http://www.justice.gov/opa/pr/2000/April/196civ.htm
*
NOVEMBER 5, 2004 – EPA TO RECEIVE $62 MILLION FOR PAST CLEANUP COSTS. Under
the consent decree, EPA will receive $50 million in payments from Atlantic
Richfield Company-a subsidiary of British Petroleum, commonly known as
ARCO-and another $12 million from the US Judgement Fund, for a total of $62
million. The consent decree was negotiated to cover EPA cleanup costs in the
Clark Fork Basin from the early 1980s until July 31, 2002.
http://www.justice.gov/opa/pr/2004/November/04_enrd_734.htm
*
AUGUST 2, 2005 – $100 MILLION SETTLEMENT REACHED FOR CLEANUP OF THE MILLTOWN
RESERVOIR. The Atlantic Richfield Company (a BP subsidiary) and the
NorthWestern Corporation have agreed to complete a $100 million-plus cleanup
of the Milltown Reservoir, removing millions of cubic yards of contaminated
sediments and decommissioning and removing the Milltown Dam, the Department
of Justice and the Environmental Protection Agency announced today. The
State of Montana and the Confederated Salish and Kootenai Tribes are also
signatories to the settlement.
http://www.justice.gov/opa/pr/2005/August/05_enrd_397.htm
*
JUNE 28, 2006 – Former BP North America Trader Pleads Guilty to Conspiracy
to Manipulate and Corner the Propane Market
http://www.justice.gov/opa/pr/2006/June/06_crm_401.html
http://www.justice.gov/criminal/pr/2006/06/2006_4649_2_CRM_06-401_fraud_bp_abbott_info.pdf
*
OCTOBER 25, 2007 – British Petroleum and several of its subsidiaries have
agreed to pay approximately $373 million in fines and restitution for
environmental violations stemming from a fatal explosion at a Texas refinery
in March 2005, leaks of crude oil from pipelines in Alaska, and fraud for
conspiring to corner the market and manipulate the price of propane carried
through Texas pipelines.
http://www.justice.gov/opa/pr/2007/October/07_ag_850.html
http://www.justice.gov/enrd/3509.htm
*
2008 – States v. British Petroleum Exploration (Alaska), Inc. (BPXA)
In United States v. British Petroleum Exploration (Alaska), Inc. (BPXA), the
corporate defendant failed to heed the many warning signs of imminent
internal corrosion of oil transit lines that a reasonable operator should
have recognized. This failure resulted in more than 200,000 gallons of
crude oil on the North Slope spreading over two acres of tundra. BPXA’s
failure to allocate sufficient resources, due to cost-cutting measures, led
to the failure of a section of the oil transit line which had not been
inspected for eight years. BPXA pled guilty to a CWA violation for the
largest-ever spill of crude oil on the north slope of Alaska. BPXA was
sentenced to pay a $20 million fine, followed by a 3-year term of probation.
Four million dollars will be used for research in support of the arctic
environment in the State of Alaska on the North Slope, and $4 million in
restitution will be paid to the State of Alaska. A second spill involving
approximately 1,000 gallons of oil, which led to the shutdown of Prudhoe Bay
oil production on the eastern side of the field, was also covered by the
plea agreement.
http://www.justice.gov/enrd/ENRD_Assets/ENRD_2008_Accomplishments_Report_Final.pdf
*
June 12, 2010 – Robert L. Rinke, individually, and on behalf of all others similarly situated, Plaintiffs
vs.
BP, P.L.C.,
BP Products North America, Inc.,
BP Corporation of North America, Inc.,
BP Exploration and Production, Inc.
BP America, Inc., Anthony Hayward,
and John and Jane Doe, 1-100
Defendants
Class Action Complaint
…to recover damages to Plaintiffs and others similarly situated. Plaintiffs’ damages were caused by Defendants’ scheme to secure billions of dollars in profits by committing a pattern of criminal acts including mail and wire fraud through submissions in the permitting process for offshore drilling.
…The action is brought under the federal RICO statue … and the Florida Civil remedies for Criminal Practices Act (comminly referred to as "Florida Civil RICO" or "Florida RICO").
http://cdn.levinlaw.com/pdf/06.12.10-RICO-Complaint.pdf
*
September 30, 2010 – BP Products to Pay Largest Single-facility Clean Air
Act Penalty for Releases of Hazardous Pollutants at Texas City Refinery.
$15 Million Penalty Resolves Federal Claims Stemming from Two Fires, Leak
and Reporting Violations at Refinery.
http://www.justice.gov/opa/pr/2010/September/10-enrd-1103.html
*
December 15, 2010 – UNITED STATES OF AMERICA, Plaintiff, v.BP EXPLORATION &
PRODUCTION INC., ANADARKO EXPLORATION & PRODUCTION LP, ANADARKO PETROLEUM
CORPORATION, MOEX OFFSHORE 2007 LLC, TRITON ASSET LEASING GMBH, TRANSOCEAN
HOLDINGS LLC, TRANSOCEAN OFFSHORE DEEPWATER DRILLING INC., TRANSOCEAN
DEEPWATER INC., AND QBE UNDERWRITING LTD., LLOYD’S SYNDICATE 1036,
Defendants.
UNITED STATES DISTRICT COURT, EASTERN DISTRICT OF LOUISIANA. Case
2:10-cv-04536, Document 1, Filed 12/15/10.
http://www.justice.gov/usao/lae/news/2010/downloads/complaint_12152010.pdf
*
Jan. 24, 2011 – Case 2:10-md-02179-CJB-SS (PLAINTIFFS’ RICO CASE STATEMENT)
Document 1059-1 Filed 01/24/11 Page 1 of 18
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
…
In Re: Oil Spill by the Oil Rig )
“Deepwater Horizon” in the Gulf ) MDL No. 2179
of Mexico, on April 20, 2010 )
) SECTION: J
Pleading Applies To: )
All Cases in Pleading Bundle B2 ) JUDGE BARBIER
)
) MAGISTRATE SUSHAN
PLAINTIFFS’ RICO CASE STATEMENT
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 2 of 18
Pursuant to this Court’s Order of January 18, 2011 and the standing order of the Eastern District of Louisiana, Plaintiffs file the following RICO Case Statement:
1. State whether the alleged unlawful conduct is in violation of 18 U.S.C.
Sections 1962(a), (b), (c), and/or (d). If you allege violations of more than one
Section 1962 subsection, treat each as separate RICO claim.
The alleged unlawful conduct is in violation of 18 U.S.C. Sections 1962(c).
The alleged unlawful conduct is in violation of 18 U.S.C. § 1962(d) for conspiring to
violate § 1962(c).
The alleged unlawful conduct is in violation of 18 U.S.C. 1962 (d) for conspiring to
violate 18 U.S.C. § 1962(a).
2. List each defendant and state the alleged misconduct and basis of liability of
each defendant.
BP Exploration & Production, Inc. (“BP Exploration”) is a Delaware corporation with its
principal place of business in Warrensville, Illinois. BP Exploration was a lease holder
and the designated operator in the lease granted that allowed the oil exploration, drilling
and production-related operations in the location where the spill emanating from the
Deepwater Horizon originated. BP Exploration participated and conspired to participate
in the predicate acts that form the pattern of racketeering alleged below.
BP America Production Company (“BP America”) is a Delaware corporation with its
principal place of business in Houston, Texas. BP America was the party to the Drilling
Contract with Transocean Ltd. for the drilling of the Macondo well by the Deepwater
Horizon vessel. BP America participated and conspired to participate in the predicate
acts that form the pattern of racketeering alleged below.
BP p.l.c. is a British public limited company with its corporate headquarters in London,
England. BP p.l.c. is the global parent company of the worldwide business operating
under the “BP” logo. BP p.l.c. participated and conspired to participate in the predicate
acts that form the pattern of racketeering alleged below.
BP Exploration, BP America, and BP p.l.c. are generally referred to herein collectively as
“BP.”
3. List the alleged wrongdoers, other than the defendants listed above, and state
the alleged misconduct of each wrongdoer.
Other possible wrongdoers involved in the pattern of racketeering include the following,
although at this point the full extent of their involvement is unknown:
2 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 3 of 18
Transocean Ltd. (“Transocean Ltd.”) is a Swiss corporation that maintains substantial
U.S. offices in Houston, Texas, and that at all pertinent times was doing business in the
State of Louisiana and within this district. Transocean Ltd. was an owner, managing
owner, owner pro hac vice, and/or operator of the Deepwater Horizon. Transocean
Ltd. participated and conspired to participate in overt acts in furtherance of the pattern of
racketeering alleged below.
Transocean Offshore Deepwater Drilling, Inc. (“Transocean Offshore”) is a Delaware
corporation with its principal place of business in Houston, Texas. Transocean Offshore
is affiliated with Transocean Ltd. and was an owner, managing owner, owner pro hac
vice, and/or operator of the Deepwater Horizon. Transocean Offshore participated and
conspired to participate in overt acts in furtherance of the pattern of racketeering alleged
below.
Transocean Deepwater, Inc. (“Transocean Deepwater”), is a Delaware corporation with
its principal place of business in Houston, Texas. Transocean Deepwater is affiliated with
Transocean Ltd. and was an owner, managing owner, owner pro hac vice, and/or
operator of the Deepwater Horizon. Transocean Deepwater participated and conspired to
participate in overt acts in furtherance of the pattern of racketeering alleged below.
Transocean Holdings, LLC (“Transocean Holdings”) is a Delaware corporation with its
principal place of business in Houston, Texas. Transocean Holdings is affiliated with
Transocean Ltd. and is a wholly-owned subsidiary of Transocean Offshore. Transocean
Holdings is an owner, managing owner, owner pro hac vice, and/or operator of the
Deepwater Horizon. Transocean Holdings participated and conspired to participate in
overt acts in furtherance of the pattern of racketeering alleged below.
Triton Asset Leasing GmbH (“Triton”) is a Swiss limited liability company with its
principal place of business in Zug, Switzerland. Triton is affiliated with Transocean Ltd.
and is an owner, managing owner, owner pro hac vice, and/or operator of the
Deepwater Horizon. Triton participated and conspired to participate in overt acts in
furtherance of the pattern of racketeering alleged below.
Transocean Ltd., Transocean Deepwater, Transocean Offshore, Transocean Holdings,
and Triton are hereinafter referred to collectively as “Transocean.”
Halliburton Energy Services, Inc. (“Halliburton”) is a Delaware corporation with its
principal place of business in Houston, Texas. Halliburton provided engineering
services, materials, testing, mixing, and pumping for cementing operations on board the
Deepwater Horizon, as well as onshore engineering support for those operations.
Subject to discovery of information in the hands of the Defendant, Plaintiffs may
determine that Halliburton participated and conspired to participate in overt acts in
furtherance of the pattern of racketeering activity alleged below.
Halliburton division Sperry Drilling Services (“Sperry”) (formerly Sperry Sun Drilling
Services) was responsible for mudlogging personnel and equipment on the Deepwater
3 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 4 of 18
Horizon, including downhole drilling tools. Subject to discovery of information in the
hands of the Defendant, Plaintiffs may determine that Sperry participated and conspired
to participate in overt acts in furtherance of the pattern of racketeering activity alleged
below.
“Halliburton” shall refer to both Halliburton Energy Services, Inc. and its Sperry
division.
Cameron International Corporation f/k/a Cooper-Cameron Corporation (“Cameron”) is a
Delaware corporation with its principal place of business in Houston, Texas. Cameron
is registered to do and does business in the State of Louisiana. Cameron manufactured,
designed, supplied, and/or installed the Deepwater Horizon’s sub-sea emergency well-
closure device known as a blowout-preventer (“BOP”), which is, and was at all material
times, an appurtenance of the vessel and a part of the vessel’s equipment. Subject to
discovery of information in the hands of the Defendant, Plaintiffs may determine that
Cameron participated and conspired to participate in overt acts in furtherance of the
pattern of racketeering activity alleged below.
M-I, LLC (“M-I”) is a Delaware limited liability company with its principal place of
business in Wilmington, Delaware. M-I, also known as M-I SWACO, supplies drilling
and completion fluids and additives to oil and gas companies in Louisiana and
elsewhere, providing pressure control, vessel instrumentation, and drilling waste
management products and services. On the Deepwater Horizon, M-I provided mud
products, including drilling fluids and spacers, engineering services, and mud
supervisory personnel, such as mud engineers and drilling fluid specialists, to manage
the properties of those fluids in the well. M-I employees planned and/or supervised key
fluid-related activities at Macondo, such as the mud displacement that was occurring at
the time of the April 20, 2010, blowout. Subject to discovery of information in the
hands of the Defendant, Plaintiffs may determine that M-I participated and conspired to
participate in overt acts in furtherance of the pattern of racketeering activity alleged
below.
Weatherford U.S. L.P. (“Weatherford”) is a Louisiana limited partnership that maintains
its principal place of business in Houston, Texas. Weatherford designed and
manufactured, marketed, sold, and/or distributed the casing components such as the float
collar, shoe, and centralizers appurtenant to the vessel, and provided the personnel and
equipment for running the casing and casing components into the wellbore. Subject to
discovery of information in the hands of the Defendant, Plaintiffs may determine that
Weatherford participated and conspired to participate in overt acts in furtherance of the
pattern of racketeering activity alleged below.
Anadarko Petroleum Corporation Co. (“Anadarko”) is a Delaware corporation with its
principal place of business in The Woodlands, Texas. Anadarko is an oil and gas
exploration and production company. Anadarko E&P Company LP (“Anadarko E&P”)
is a Delaware limited partnership with its principal place of business in The Woodlands,
Texas. Anadarko E&P is an oil and gas exploration and production company. MOEX
4 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 5 of 18
Offshore 2007 LLC (“MOEX Offshore”) is a Delaware corporation with its principal
place of business in Houston, Texas. MOEX Offshore is a wholly-owned subsidiary of
MOEX USA Corporation. MOEX USA Corporation (“MOEX USA”) is incorporated in
Delaware and has its principal place of business in Houston, Texas. MOEX USA is the
parent company of MOEX Offshore. Mitsui Oil Exploration Co., Ltd. (“MOECO”) is
incorporated in Japan and has its principal place of business in Tokyo, Japan. As of
June 30, 2010, MOECO identified itself as having the following U.S. subsidiaries or
affiliates: MitEnergy Upstream LLC, MOEX USA Corporation, MOEX Offshore 2007
LLC, MOEX Gulf of Mexico Corporation, MOEX Oil & Gas Texas LLC, and Mitsui
E&P USA LLC. Each of these subsidiaries of MOECO share the same Houston, Texas,
address. Defendants MOEX Offshore, MOEX USA, and MOECO are referred to
collectively herein as “MOEX.” While BP was the sole lease operator of the
Deepwater Horizon, Anadarko, Anadarko E&P, and MOEX were considered non-
operational leaseholders. On October 1, 2009, BP Exploration, as operator, and MOEX
Offshore, as non-operator, entered into the Macondo Prospect Offshore Deepwater
Operating Agreement. On December 17, 2009, BP Exploration, MOEX Offshore,
Andarko E&P, and Andarko executed a "Joinder" of the Operating Agreement.
Subsequently, the parties to the Operating Agreement held the following ownership
percentages in the Macondo Prospect: BP Exploration, 65%; MOEX Offshore, 10%;
Anadarko E&P, 22.5%; and, Anadarko, 2.5%. According to the MMS’s website,
effective April 1, 2010, record title interest in the Macondo prospect was held as
follows: BP Exploration, 65%; MOEX Offshore, 10%; and, Anadarko, 25%. Subject to
discovery of information in the hands of the Defendant, Plaintiffs may determine that
Anadarko and MOEX participated and conspired to participate in overt acts in
furtherance of the pattern of racketeering activity alleged below.
The former Minerals Management Service (“MMS”) was a federal entity created in 1982,
intended to serve as the designated agency responsible for the mineral leasing of
submerged lands of the Outer Continental Shelf, including the supervision of the
Deepwater Horizon drilling operations. The MMS was reorganized as the Bureau of
Ocean Energy Management, Regulation, and Enforcement (BOEMRE) on June 18, 2010;
however, it shall be referred to as the MMS throughout this document. Subject to
discovery of information in the hands of the Defendant, Plaintiffs may determine that
certain dishonest MMS employees participated and conspired to participate in overt acts
in furtherance of the pattern of racketeering activity alleged below.
The Marine Preservation Association (“MPA”) is a consortium of major oil industry
companies, including BP, Chevron, Exxon-Mobil, Shell and Conoco Phillips, created in
response to the 1990 Oil Pollution Act, which required that anyone involved in the
transportation, distribution or receipt of petroleum products on water must establish an
approved plan that—should they cause a significant oil spill, responds to the “maximum
extent practicable.” The MPA funds the Marine Spill Response Corporation (“MSRC”),
which has been held out by Defendants as the “largest, most dedicated standby oil spill
response program in the United States.” The above oil companies all utilized the
Response Group to prepare the plans submitted to the MMS that contain
misrepresentations and omissions regarding their ability to respond to and contain
5 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 6 of 18
deepwater oil spills. Subject to discovery of information in the hands of the Defendant,
Plaintiffs may determine that the above oil companies colluded through the above
entities to misrepresent their ability to contain a deepwater oil spill and thereby
participated and conspired to participate in overt acts in furtherance of the pattern of
racketeering activity alleged below.
4. List the alleged victims and state how each victim allegedly was injured.
The named plaintiffs and their injuries are as follows:
Plaintiff, Robert L. Rinke owns and resides at 18 Via De Luna Drive, Beach Club
Penthouse #6, Pensacola Beach, Florida 32561. The Beach Club Resort and Spa is a 130
unit condominium complex located on the Gulf of Mexico, Pensacola Beach, Escambia
County, Florida. Due to the Spill, Plaintiff Rinke has suffered the loss, damage and
diminution in value of his condominium property abutting the Gulf of Mexico.
Plaintiff, Armand’s Bistro LLC, is a domestic limited liability company domiciled and
doing business in Louisiana. Armand’s Bistro was a seafood restaurant located inside the
Holiday Inn on Highway 51 in LaPlace, Louisiana. Due to the Spill, it could not obtain
the seafood it needed to operate, and had to close.
Plaintiffs Roland and Barbara Hingle reside at 151 Bouson Lane, Buras, Louisiana. The
Hingles are commercial shrimpers in the Gulf of Mexico who have lost earnings and
property from the Spill.
Plaintiff Alan Sheen, M.D. is a resident of Louisiana who resides in this district and owns
property in Florida—a condominium with the address of Sundunes 112, 7979 Gulf Blvd.,
Navarre Beach, Florida. Dr. Sheen has owned the condominium for more than five years.
In 2010, his rental income was less than half the average of the prior two years, due to the
Spill.
Plaintiff Mid South Seafood, Inc. is a Mississippi corporation doing business throughout
the state of Mississippi. Plaintiff is a seafood business that buys seafood from the Gulf of
Mexico on the Gulf Coast and sells the seafood throughout Mississippi. Due to the Spill,
Plaintiff Mid South Seafood has lost business and earnings.
The alleged class members—all victims—fall into nine basic categories, all of whom
were injured in their business or property as a result of the Deepwater Horizon oil spill.
In presenting these categories of victims in the following order, Plaintiffs do not suggest
or imply any hierarchy of merit, preference, or importance:
(a)
Commercial fishermen, shrimpers, crabbers, oystermen, the
owners and operators of businesses involving commercial fishing,
shrimping, crabbing and oystering (the “Commercial Fishermen
Plaintiffs”).
6 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 7 of 18
(b) Seafood processors, distributors, retail and seafood markets, and
restaurant owners and operators, and all those employed by
seafood processors, distributors, retail and seafood markets, and
restaurants (the “Processing and Distributing Plaintiffs”).
(c) Recreational business owners, operators, and/or workers, including
recreational fishing businesses, commercial guides, and charter
fishing businesses who earn their living through the use of the Gulf
of Mexico for businesses (the “Recreational Business Plaintiffs”).
(d) Commercial businesses, business owners, operators, and/or
workers, including commercial divers, offshore oilfield service,
repair, and supply, real estate agents, and supply companies and
their employees (the “Commercial Business Plaintiffs”).
(e) Recreational sport fishermen, recreational divers, beachgoers, and
recreational boaters (the “Recreation Plaintiffs”).
(f) Plant and dockworkers, including commercial seafood plant
workers, longshoremen, and ferry operators (the “Plant and Dock
Worker Plaintiffs”). Owners, lessors, and lessees of real property,
alleged to be damaged, harmed, or impacted, physically or
economically, including but not limited to condominium owners
along the Gulf Coast that suffered economic loss through
diminution in their property value and lessees of oyster beds (the
“Real Property Plaintiffs”).
(g) Hotel owners and operators, vacation rental owners and agents,
and all those who earn their living from the tourism industry (the
“Real Property/Tourism Plaintiffs”).
(h) Banks, financial institutions, and retail businesses that suffered
losses as a result of the Spill (the “Banking/Retail Business
Plaintiffs”).
(i) Persons who utilize natural resources for subsistence (the
“Subsistence Plaintiffs”).
5.
Describe in detail the pattern of racketeering activity or collection of an
unlawful debt alleged for each RICO claim. A description of the pattern of
racketeering activity shall include the following information:
(a)
List the alleged predicate acts and the specific statutes allegedly
violated;
The predicate acts constitute violations of mail fraud under 18 U.S.C. § 1341 and wire
7
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 8 of 18
fraud under 18 U.S.C. § 1343. These predicate acts form the pattern of racketeering and
are the basis of BP’s violation of 18 U.S.C. § 1962(c). These predicate acts also
constitute the primary overt acts taken in furtherance of the conspiracies under 18 U.S.C.
§ 1962(d) to violate 18 U.S.C. §§ 1962(c) and (a).
(b)
Provide the dates of the predicate acts, the participants in the
predicate acts and a description of the facts surrounding each
predicate act;
See response to 5(c), below.
(c)
If the RICO claim is based upon the predicate offenses of wire fraud,
mail fraud, fraud in the sale of securities, or fraud in connection with
a case under U.S.C. Title 11, the “circumstances constituting fraud or
mistake shall be stated with particularity,” Fed. R. Civ. P. 9(b).
Identify the time, place, and contents of the alleged misrepresentation
or omissions, and the identity of persons to whom and by whom the
alleged misrepresentations or omissions were made;
The facts and details such as time, place, content of misrepresentations and omissions,
and identity of persons or the government entity to whom and by whom the alleged
misrepresentations and omissions were made that are known to date constituting the
predicate acts are:
i.
Upon information and belief, on December 1, 2000, BP submitted
by mail and/or interstate wire or interstate carrier to MMS a
Regional Oil Response Plan addressing the entire Gulf of Mexico
area, including the area later drilled by the Deepwater Horizon.
This plan falsely stated that BP could contain an oil spill of up to
250,000 barrels per day. This plan included other blatant
misrepresentations, such as: an ability to haul out sea lions, seals
and walruses; links to a Japanese home shopping website as being
one of the “primary equipment providers for BP in the Gulf of
Mexico region [for] rapid deployment of spill response resources.”
BP Regional Oil Response Plan – Gulf of Mexico.
ii.
Upon information and belief, on June 30, 2009, BP submitted by
mail and/or interstate wire or interstate carrier to MMS a revised
Regional Oil Response Plan addressing the Gulf of Mexico, that
included the same misrepresentations as the prior plan. It also
added new misrepresentations, such as references to a professor
8
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 9 of 18
listed as a consultant for responding to the spill who had died in
2005.
iii.
Upon information and belief, on February 23, 2009, BP submitted
by mail and/or interstate wire or interstate carrier to MMS an
Initial Exploration Plan for Mississippi Canyon Block 252 – the
document covering the Macondo project. In this document, BP
falsely minimized the prospect of any serious damage associated
with a spill, saying there would be only “sub-lethal” effects on
fish and marine mammals, and “birds could become oiled.” BP
further misrepresented that “[i]n the event of an unanticipated
blowout resulting in an oil spill, it is unlikely to have an impact
based on the industry wide standards for using proven equipment
and technology for such responses, implementation of BP’s
Regional Oil Spill Response Plan which address available
equipment and personnel, techniques for containment and
recovery and removal of the oil spill.” [emphasis added]. BP also
falsely stated that it was prepare to handle a worst-case discharge
of 162,000 barrels of oil per day.
iv.
Interstate wires were used on March 25, 2010 and March 30, 2010
to further BP’s scheme to defraud the MMS. Emails on those dates
were sent among BP personnel, and concluded that the long string
casing design would “save a lot of time…at least 3 days,” “saves a
good deal of time/money,” and is the “[b]est economic case.”
Email from Brian Morel, BP Drilling Engineer, to Allison Crane,
Materials Management Coordinator, March 25, 2010; Email from
Brian Morel, BP Drilling Engineer, to Sarah Dobbs, Completion
Engineer, March 30, 2010. Despite the fact the BP itself had
concluded that it would not use the long string casing design
because of the high risk of a failed cement job and the inability to
comply with MMS regulations, BP then on April 15, 2010 sent by
mail and/or interstate wire or interstate carrier a request to MMS
asking for a permit to use long string casing, apologizing for not
having mentioned its use earlier and falsely stating that they had
“inadvertently” failed to include its use in earlier submitted plans.
v.
Similarly, interstate wires were used on March 25, 2010 to further
BP’s scheme to defraud the MMS when Brian Morel of BP sent an
email to Heather Powell, copied to Scherie Douglas, Senior
Regulatory Compliance Team Lead at BP, stating in part with
respect to obtaining a bypass permit: “I have attached what I feel
is pertinent data, only thing missing from the documents we
submitted for the bypass permit is the engineering calculations, as
they don’t completely pertain to this liner, hopefully they will not
ask for them. However if they do want them I can provide.” This
9
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 10 of 18
email reflects an intent to knowingly provide insufficient
documentation to MMS and then, if caught with respect to the
insufficient documentation, provide incorrect documentation.
vi.
BP used the interstate wires in furtherance of its scheme, in
particular as the scheme was implemented to place profit above
safety with respect to the use of pipe centralizers. BP knowingly
chose an insufficient number of “centralizers” to prevent
channeling of gas during the cementing process. Halliburton, the
contractor hired by BP to cement the well, warned BP that the well
could have a “SEVERE gas flow problem” if BP lowered the final
string of casing with only six centralizers instead of 21
recommended by Halliburton. BP rejected Halliburton’s advice to
use additional centralizers, solely because the delay it would entail.
In an April 16, 2010 email, a BP executive involved in the
decision-making explained: “it will take 10 hours to install
them…I do not like this.” Later that day, another BP official
knowingly acknowledged the increased risk of proceeding without
a sufficient number of centralizers, but carelessly commented with
lethal disregard for the people and the environment that could be
seriously injured, causing further injury to business or property:
“who cares, it’s done, end of story, will probably be fine. . . .”
(Email from Brett W. Cocales to Brian P. Morel, April 16, 2010).
vii.
According to the National Commission report, on April 16, 2010
BP sent, upon information or belief by mail or interstate wire, an
Application for Permit to Modify to MMS describing a temporary
abandonment procedure that was different from the procedure in
either the April 12 drilling plan, an April 14 email, or an April 20
“Ops Note.” There is no evidence that these changes went through
any sort of formal risk assessment or management of change
process as required.
Upon information and belief, numerous other acts of mail and wire fraud will be
uncovered in discovery, because the bulk of relevant mails and wires currently are in the
hands of BP and its co-conspirator Transocean.
(d)
Describe whether the alleged predicate acts relate to the enterprise as
part of a common plan. If so, describe in detail.
The alleged predicate acts relate to the association-in-fact enterprise of BP and
Transocean as part of a common plan to place profits over safety by: (1) fraudulently
deceiving federal and state regulators that they would safely conduct their offshore oil
drilling operations to prevent oil spills, (2) fraudulently deceiving federal and state
regulators that they could effectively respond to and contain any oil spill, including worse
case scenario oil spills like the Deepwater Horizon disaster, (3) hampering containment
10
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and cleanup responses by fraudulently deceiving federal and state regulators regarding
the oil spill flow rate; and (4) fraudulently deceiving federal and state regulators
regarding the quickest and safest method to kill the Macondo well and stop the Spill.
Defendant BP participated in and conspired with Transocean to engage in one or more of
these schemes. BP individually, and BP in conjunction with its co-conspirator
Transocean, used the association-in-fact enterprise of BP and Transocean to carry out this
common plan.
6.
Describe in detail the alleged enterprise for each RICO claim. A description
of the enterprise shall include the following information;
(a)
State the names of the individuals, partnerships, corporations,
associations or other entities allegedly constituting the enterprise;
BP and Transocean constitute the association-in-fact enterprise, within the meaning of 18
U.S.C. § 1961(4), for Plaintiffs’ 18 U.S.C. § 1962(c) claim, for Plaintiffs’ 18 U.S.C. §
1962(d) RICO claim for conspiracy to violate 18 U.S.C. § 1962(c), and for Plaintiffs’ 18
U.S.C. § 1962(d) claim for conspiracy to violate 18 U.S.C. § 1962(a).
(b)
Describe the structure, purpose, roles, function and course of conduct
of the enterprise;
The structure of the enterprise is an association-in-fact between BP and Transocean. The
purpose, role, function and course of conduct of the enterprise is in part to carry out the
lawful business of exploring and developing oil reserves, and in part to carry out the
pattern of racketeering described in answer to question No. 5, above. The enterprise
possessed and continues to possess an ongoing organizational structure.
(c)
State whether any defendants are employees, officers or directors of
the alleged enterprise;
Defendant BP is not an employee, officer or director of the alleged enterprise.
(d)
State whether any defendants are associated with the alleged
enterprise, and if so, how;
Defendant BP is associated with alleged enterprise both as a member of the association
in-fact enterprise, and an entity engaged in the management, operation and control of the
enterprise.
(e)
State whether you allege that the defendants are individuals or entities
separate from the alleged enterprise, or that the defendants are the
enterprise itself, or members of the enterprise;
Defendant BP is a member of the association-in-fact enterprise.
11
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 12 of 18
(f)
If you alleged any defendants to be the enterprise itself, or members
of the enterprise, explain whether such defendants are perpetrators,
passive instruments, or victims of the alleged racketeering activity.
Defendant BP is a perpetrator of the alleged racketeering activity.
7.
State whether you allege and describe in detail how the pattern of
racketeering activities and the enterprise are separate or have merged into
one entity.
The Enterprise exists separate and apart from its pattern of racketeering activity,
inasmuch as BP and association-in-fact member Transocean have multiple goals, not all
of which are fraudulent.
8.
Describe the alleged relationship between the activities of the enterprise and
the pattern of racketeering activity. Discuss how the racketeering activity
differs from the usual and daily activities of the enterprise, if at all.
The lawful activity engaged in by the Enterprise includes ongoing partnerships between
BP and Transocean to explore and develop oil reserves. But Defendant BP has, at a
minimum since 2001, also used this enterprise to conduct the related acts of mail and
wire fraud comprising the pattern of racketeering.
9.
Describe what benefits, if any, the alleged enterprise receives from the
alleged pattern of racketeering activities.
The Enterprise benefits from the alleged pattern of racketeering activity by obtaining
billions of dollars in oil and profits through the pattern of racketeering activity that misled
the government regulators into believing the Enterprise was using the best available and
safest technology to conduct its offshore drilling operations and contain any spills. The
mail and wire fraud constituting the pattern of racketeering activities was necessary for
the Enterprise to receive this benefit, because absent the pattern of racketeering the
regulators would have required BP and co-conspirator Transocean to expend the funds
necessary to comply with regulatory requirements, or forego the profitable activities.
Government regulators would not have allowed the Enterprise to conduct its offshore
exploration, development and containment activities in a knowingly unsafe manner.
10.
Describe the effect of the activities of the enterprise on interstate or foreign
commerce.
At all relevant times, the activities of the Enterprise substantially affected interstate and
foreign commerce, through and including but not limited to, its large investments,
expenditures and offshore drilling activities with numerous entities involved in its
ongoing offshore drilling in the Gulf of Mexico and around the world.
12
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 13 of 18
11.
If the complaint alleges a violation of 18 U.S.C. Section 1962 (a), provide the
following information:
(a)
State who received the income derived from the pattern of
racketeering activity or through the collection of an unlawful debt;
and,
(b)
Describe the use or investment of such income.
Not applicable.
12.
If the complaint alleges a violation of 18 U.S.C. Section 1962 (b), provide the
following information:
(a)
Describe in detail the acquisition or maintenance of any interest in or
control of the alleged enterprise; and,
(b)
State whether the same entity is both the liable “person” and the
“enterprise” under Section 1962 (b).
Not applicable.
13.
If the complaint alleges a violation of 18 U.S.C. Section 1962 (c), provide the
following information:
(a)
State who is employed by or associated with the enterprise;
Defendant BP is associated with the Enterprise.
(b)
State whether the same entity is both the liable “person” and the
“enterprise” under Section 1962 (c).
Defendant BP is not both the liable “person” and the “enterprise” under Section 1962(c).
14.
If the complaint alleges a violation of 18 U.S.C. Section 1962 (d), describe in
detail the alleged conspiracy.
As described in more detail in response to 5(c) and in the Complaint, Defendant BP
conspired with Transocean to mislead government regulators into believing they were
safely conducting offshore drilling operations and that they could safely contain
deepwater oil spills. Defendant BP and Transocean conspired under Section 1962(d) to
violate Section 1962(c) and undertook overt acts of mail and wire fraud in furtherance of
that conspiracy. Similarly, Defendant BP and Transocean conspired under Section
1962(d) to violate Section 1962(a) by undertaking overt acts of mail and wire fraud in an
effort to use or invest income unlawfully derived from such conduct, directly or
indirectly, in the establishment or operation of the association-in-fact Enterprise. BP and
13
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 14 of 18
Transocean both agreed to the objective of the conspiracy. The specifics of some of the
knowing interactions evidencing this conspiracy are set forth in more detail in response to
5(c), above, and some of the specifics will be secured in discovery since such additional
evidence supporting these conspiracy claims is in the hands of Defendant BP and coconspirator
Transocean.
15.
Describe the alleged injury to business or property.
The RICO violations caused the spill and the failure to effectively contain the spill, which
was the direct and proximate cause of injury to business or property of Plaintiffs. The
injury to business or property of the named Plaintiffs and class members is more fully
described in response to question No. 4, above.
16.
Describe the relationship between the alleged injury and violation of the
RICO statute.
The violation of the RICO statute is the direct and proximate cause of the injuries
suffered by the victim/plaintiffs in this case. The scheme to defraud regulators regarding
the safety of Defendants’ deep sea oil drilling allowed Defendants to proceed with the
Deepwater Horizon drilling without prescribed and claimed safeguards that would have
prevented the spill, causing the spill and the consequent damage to Plaintiffs’ business
and property. The scheme to defraud regulators regarding Defendants’ ability to contain
a spill allowed Defendants to proceed with the Deepwater Horizon drilling without a
prescribed and claimed containment plan in place, exacerbating the spill and the
consequent injury and damage to Plaintiffs’ business and property.
17.
List the damages sustained by reason of the violation of Section 1962,
indicating the amount for which each defendant allegedly is liable.
The damages sustained by reason of the violation of Section 1962 are ongoing, but to
date clearly number in the billions of dollars. Defendant BP is liable for the injury to
Plaintiffs and class members and all damages. Plaintiffs reserve the right to amend the
Complaint to add additional Defendants that are liable for the injury and damages to
Plaintiffs and class members.
18.
List all other federal causes of action, if any, and provide the relevant statute
numbers.
No other federal cause of action is set forth in the B2 Master Complaint. Plaintiffs reserve
the right to add additional federal causes of action against BP and/or additional
Defendants.
19.
List all pendent states claim, if any.
Plaintiffs also seek equity relief under FLA. STAT. ANN. §§ 895.05 (1), (6).
14 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 15 of 18
20. Provide any additional information you feel would be helpful to the Court in
processing your RICO claim.
Plaintiffs believe their RICO claim is a straightforward application of civil RICO, and
would be pleased to answer any questions the Court may have in processing this claim.
Dated: January 24, 2011.
Respectfully submitted,
/s/ Stephen J. Herman
Stephen J. Herman, La. Bar No. 23129
HERMAN HERMAN KATZ & COTLAR LLP
820 O’Keefe Avenue
New Orleans, Louisiana 70113
Telephone: (504) 581-4892
Fax No. (504) 569-6024
E-Mail: sherman@hhkc.com
/s/ James Parkerson Roy______
James Parkerson Roy, La. Bar No. 11511
DOMENGEAUX WRIGHT ROY & EDWARDS LLC
556 Jefferson Street, Suite 500
Lafayette, Louisiana 70501
Telephone: (337) 233-3033
Fax No. (337) 233-2796
E-Mail: jimr@wrightroy.com
Plaintiffs Liaison Counsel Plaintiffs Liaison Counsel
PLAINTIFFS’ STEERING COMMITTEE
Brian H. Barr
LEVIN, PAPANTONIO, THOMAS,
MITCHELL, ECHSNER & PROCTOR, PA
316 South Baylen St., Suite 600
Pensacola, FL 32502-5996
Office: (850) 435-7045
Telefax: (850) 436-6187
E-Mail: bbarr@levinlaw.com
Jeffrey A. Breit
BREIT DRESCHER & IMPREVENTO
999 Waterside Drive, Suite 1000
Norfolk, VA 23510
Office: (757) 670-3888
Telefax: (757) 670-3895
E-Mail: jbreit@bdbmail.com
Elizabeth J. Cabraser
LIEFF, CABRASER, HEIMANN &
BERNSTEIN, LLP
275 Battery Street, 29th Floor
Robin L. Greenwald
WEITZ & LUXENBERG, PC
700 Broadway
New York, NY 10003
Office: (212) 558-5802
Telefax: (212) 344-5461
E-Mail: rgreenwald@weitzlux.com
Rhon E. Jones
BEASLEY, ALLEN, CROW, METHVIN,
PORTIS & MILES, P. C.
218 Commerce St., P.O. Box 4160
Montgomery, AL 36104
Office: (334) 269-2343
Telefax: (334) 954-7555
E-Mail: rhon.jones@beasleyallen.com
Matthew E. Lundy
LUNDY, LUNDY, SOILEAU & SOUTH, LLP
501 Broad Street
Lake Charles, LA 70601
15
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 16 of 18
San Francisco, CA 94111-3339
Office: (337) 439-0707
Office: (415) 956-1000
Telefax: (337) 439-1029
Telefax: (415) 956-1008
E-Mail: mlundy@lundylawllp.com
E-Mail: ecabraser@lchb.com
Michael C. Palmintier
Philip F. Cossich, Jr.
deGRAVELLES, PALMINTIER,
COSSICH, SUMICH, PARSIOLA & TAYLOR
HOLTHAUS & FRUGE’
8397 Highway 23, Suite 100
618 Main Street
Belle Chasse, LA 70037
Baton Rouge, LA 70801-1910
Office: (504) 394-9000
Office: (225) 344-3735
Telefax: (504) 394-9110
Telefax: (225) 344-0522
E-Mail: pcossich@cossichlaw.com
E-Mail: mpalmintier@dphf-law.com
Robert T. Cunningham
Paul M. Sterbcow
CUNNINGHAM BOUNDS, LLC
LEWIS, KULLMAN, STERBCOW &
1601 Dauphin Street, P. O. Box 66705
ABRAMSON
Mobile, AL 36660
601 Poydras Street, Suite 2615
Office: (251) 471-6191
New Orleans, LA 70130
Telefax: (251) 479-1031
Office: (504) 588-1500
E-Mail: rtc@cunninghambounds.com
Telefax: (504) 588-1514
E-Mail: sterbcow@lksalaw.com
Alphonso Michael “Mike” Espy
MORGAN & MORGAN, P.A.
Scott Summy
188 East Capitol Street, Suite 777
BARON & BUDD, P.C.
Jackson, MS 39201
3102 Oak Lawn Avenue, Suite 1100
Office: (601) 949-3388
Dallas, TX 75219
Telefax: (601) 949-3399
Office: (214) 521-3605
E-Mail: mike@mikespy.com
Telefax: (214) 599-1172
E-Mail: ssummy@baronbudd.com
Calvin C. Fayard, Jr.
FAYARD & HONEYCUTT
Mikal C. Watts (PSC)
519 Florida Avenue, SW
WATTS GUERRA CRAFT, LLP
Denham Springs, LA 70726
Four Dominion Drive, Building 3, Suite 100
Office: (225) 664-4193
San Antonio, TX 78257
Telefax: (225) 664-6925
Office: (210) 447-0500
E-Mail: calvinfayard@fayardlaw.com
Telefax: (210) 447-0501
E-Mail: mcwatts@wgclawfirm.com
Ervin A. Gonzalez
COLSON HICKS EIDSON
255 Alhambra Circle, Penthouse
Coral Gables, FL 33134
Office: (305) 476-7400
Telefax: (305) 476-7444
E-Mail: ervin@colson.com
16 Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 17 of 18
RICO MASTER COMPLAINT
WORKING GROUP
Hiram Eastland
EASTLAND LAW OFFICES, PLLC
307 Cotton Street
Greenwood, MS 38930
Telephone: (662) 453-1227
Facsimile: (662) 453-2808
Email: eastlandlaw@bellsouth.net
Wanda J. Edwards
FAYARD & HONEYCUTT, APC
519 Florida Avenue SW
Denham Springs, LA 70726
Telephone: (225) 664-4193
Facsimile: (225) 664-6925
Email: wandaedwards@fayardlaw.com
Keith D. Jones
8480 Bluebonnet Blvd., Suite F
Baton Rouge, LA 70810
Telephone: (225) 763-6900
Facsimile: (225)
Email: keith@kjones-law.com
W. B. Markovits
WAITE, SCHNEIDER, BAYLESS &
CHESLEY CO., L.P.A.
1513 Fourth & Vine Tower
1 West Fourth Street
Cincinnati, OH 45202
Telephone: (513) 621-0267
Facsimile: (513) 621-0262
Email: billmarkovits@wsbclaw.com
Peter Prieto
PODHURST ORSECK P.A.
25 West Flagler Street, Suite 800
Miami, FL 33130
Telephone: (305) 358-2800
Facsimile: (305) 358-2382
Email: PPrieto@podhurst.com
17
Case 2:10-md-02179-CJB-SS Document 1059-1 Filed 01/24/11 Page 18 of 18
Of Counsel:
G. Robert Blakey
Notre Dame Law School *
Notre Dame, IN 36556
Telephone: (574) 631-5717
Facsimile: (574) 631-4197
Email: G.R. Blakey.1@nd.edu
* Notre Dame Law School is used solely for purposes of address.
CERTIFICATE OF SERVICE
WE HEREBY CERTIFY that the above and foregoing RICO Case Statement has
been served on All Counsel by electronically uploading the same to Lexis Nexis File &
Serve in accordance with Pretrial Order No. 12, and that the foregoing was electronically
filed with the Clerk of Court of the United States District Court for the Eastern District of
Louisiana by using the CM/ ECF System, which will send a notice of electronic filing in
accordance with the procedures established in MDL 2179, on this 24th day of January,
2011.
/s/ James Parkerson Roy and Stephen J. Herman
*
BP cut corners
BP cut corners in days before Deepwater Horizon blowout, resulting oil spill, documents show. BP made a series of money-saving shortcuts and blunders that dramatically increased the danger of a destructive oil spill in a well that an engineer ominously described as a "nightmare" just six days before the blowout. Time after time, it appears that BP made decisions that increased the risk of a blowout to save the company time or expense. If this is what happened, BP’s carelessness and complacency have inflicted a heavy toll on the Gulf, its inhabitants, and the workers on the rig…"
http://www.uscg.mil/foia/docs/DWH/BPDWH.pdf
**************************************************************************
March 31, 2011, Times-Picayune – Process of combining allegations against BP
in the wake of last year’s oil spill begins with court filings.
Attorneys representing businesses, fishermen and residents claiming to be
physically or financially injured by the BP Deepwater Horizon oil spill
filed two documents in federal court in New Orleans this week laying out key
pieces of their legal strategy, including charges that BP and drilling
contractor Transocean conspired to defraud the Minerals Management Service
concerning the safety of drilling such a deep well, and that their clients
were injured by the use of dispersants.
http://www.nola.com/business/index.ssf/2011/03/process_of_combining_allegatio.html
*
BP cut corners in days before Deepwater Horizon blowout, resulting oil spill, documents show.
*
Oil spill hearings: BP didn’t test mud prior to critical pipeline procedure, driller testifies | NOL
http://www.nola.com/news/gulf-oil-spill/index.ssf/2010/05/oil_spill_update.html
*
19th-century law may come into play in BP case
@HoustonFowler: FuelFix: 19th-century law may come into play in BP case http://t.co/rOEZgeF via @fuelfixblog #oilspill #hounews
*
Investigator Warned MMS in 2009 About Deepwater Gas Blowouts in Gulf of Mexico
*
April 19, 2011, Telegraph (UK) – BP: disasters and disputes
It may have been a rocky twelve months for BP, but the past six years haven’t been easy either. We take a look at some of the oil giant’s lows.
*
April 26, 2011, Orlando Sentinel – Carnival sues BP, others over Gulf of Mexico oil spill
Carnival is seeking damages for "economic losses and damages" suffered as a result of the oil spill, according to court documents filed April 20 in the U.S. District Court Eastern District of Louisiana.
To establish its eligibility to seek damages, Carnival said in court papers that it serves ports in Florida, Alabama, Texas and Louisiana and uses the Gulf of Mexico to transport guests and ship crew to several ports worldwide.
*
April 28, 2011 – NRDCGulf: Louisiana Oystermen File Class Action Against BP http://tinyurl.com/6ld6p3w
*
*
Info compiled by Marlitta H. Perkins, 2011
#CorporatePersonhood #ChemicalsHeavyMetalsVOCsampPoisonousToxins #Bacteria #GulfofMexicoGOM #GulfCoast #EnivironmentalConcern #GreedampCorruption #Toxic #Pollution #Vibrio
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