Friday, July 30, 2010

BP in Control

With the oil spew to be permanently stopped via a static kill, BP marches onward. A hated CEO is on his way out, an American taking his place. WilmerHale's next move is ring fencing liability for the oil catastrophe. That involves framing the causes of the spill.

BP's internal investigation will be the first one finished. It is due in August. FT reported:

BP believes it will be able to rebut the charge that it was guilty of “gross negligence” but nothing is certain until the outcome of the investigations is known.

This is the same BP that prohibited the use of certain words in its internal investigations. They'll spin it far away from "gross negligence." BP CEO Tony Hayward set the tone with his Congressional non-testimony.

Obama's Ken Salazar expressly bailed on his charge to conduct a 30 day investigation. That leaves Obama's Oil Spew Commission, with two conflicted members, to uphold the public interest. Congressional corporacrats denuded the tainted commission's ability to investigate.

Spew Commission Co-chair Bob Graham echoed the "C" word, regarding BP's culture. James A. Baker, III came up with the term in his investigation of BP's 2005 Texas City refinery explosion. After going light on CEO Lord John Browne, Baker's Carlyle Group friends hired Browne at Riverstone Holdings.

A finding of gross negligence impacts BP's potential liability. That said, ExxonMobil got a $5 billion punitive fine reduced to $500 million, simply using America's court system.

Would a determination of gross negligence impact Ken Feinberg's payouts? I wouldn't sign Ken's BP release of liability until that question is answered.

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