It is estimated that BP PLC will pay $7.8 billion to resolve medical and economic claims from the worst offshore oil spill in the history of the United States.  The settlement is not capped and the final figure could be lower or higher.

The settlement was made final in a 125-page ruling by U.S. District Judge Carl Barbier.  The judge stated in his ruling that none of the objections raised had shown the settlement to be inadequate, unfair or unreasonable.

Thousands of people chose to opt out of the settlement after Barbier gave it preliminary approval, in order to pursue the cases on an individual basis.  By the December 15 deadline to change their minds, more than 1,700 people had opted back in.

A BP company spokesperson said that the settlement was good for the people of the Gulf region and was in the best interest of BP’s stakeholders, in that years of litigation would be avoided.  BP added that its goals were restoration in the area and the elimination of legal risks.

Attorneys for the plaintiffs that accepted the settlement also said they were pleased it had been approved, as they believed it would bring relief to the people and businesses affected by the spill.

In April 2010, BP’s Macondo well blew out, triggering an explosion that resulted in the deaths of 11 oil rig workers and the leakage of 200 million gallons of oil.  Recreational and commercial fishing and shrimping were stopped for months in much of the Gulf.

Much litigation will still take place, including a trial, scheduled to take place next year, to determine the causes of the blowout and assign fault by percentage to the various companies involved.

People and businesses in Mississippi, Louisiana, Alabama, and some coastal areas of western Florida and eastern Texas are covered by the settlement.

According to Barbier, the settlement will prevent extremely lengthy litigation such as that following the Exxon Valdez oil spill.  Barbier has yet to rule on a separate medical settlement for workers who participated in the cleanup and said exposure to oil and dispersant agents caused them to become ill.

Barbier said that BP had already begun paying claims, paying about $405 million during a transitional process and has already authorized $1.4 billion in payments.  Attorney’s fees will be paid separately.

Gregory D. Jordan is an Austin business litigation attorney, Austin business litigation lawyer, Texas business litigation attorney, Texas business litigation lawyer, Austin business attorney, Austin employment lawyer, Austin oil and gas lawyer and Texas oil and gas lawyer. To learn more, visit http://www.theaustintriallawyer.com.

Landowners in Texas, Michigan and North Dakota have filed lawsuits against the company, claiming that Chesapeake reneged on lease agreements. As the price of gas decreased, Chesapeake attempted to cancel hundreds of lease agreements with mineral rights owners, only to be rebuked in court.

A recent decision by the U.S. Court of Appeals is one example. Chesapeake attempted to void an agreement with Plano, Texas-based Peak Energy Corp., claiming that the letter of intent both parties signed did not amount to a valid contract. The Fifth Circuit upheld a multi-million dollar ruling from the district court, holding that Chesapeake breached its contract and ordering the company to pay Peak Energy $12,000 per acre. The court’s decision does not bode well for Chesapeake, as the Fifth Circuit covers a large swath of oil and gas land and its rulings are influential in other circuits regarding mineral rights matters. Chesapeake told investors recently that the failure of the hundreds of lease deals had cost the company more than a billion dollars.

Last spring it was alleged that Aubrey McClendon, who founded Chesapeake and served as its board chairman, had taken out more than $1.5 billion in loans that he did not disclose, and that his personal lender was also a Chesapeake investor. The company ousted McClendon as chairman, and the Securities and Exchange Commission continues to investigate financial dealings between McClendon and Chesapeake.

Later in the year, Reuters reported that Chesapeake and its competitor, Encana Corp., had tried to prevent a situation where they would bid against each other in a land purchase. The Department of Justice is now investigating whether or not anti-trust laws were violated.

Chesapeake Energy is the second-largest gas producer in the United States and once held mineral rights to land equal in size to the state of West Virginia.

Gregory D. Jordan is an Austin business attorney, Austin employment lawyer, and Austin business litigation lawyer. To learn more, visit Theaustintriallawyer.com.