By Amanda Bronstad, From The National Law Journal

A federal appeals court has struck down BP’s effort at gaining access to confidential information about pending claims to its $9.9 billion oil spill settlement in its ongoing attempt to root out fraud.

In a 2-1 opinion, the U.S. Court of Appeals for the Fifth Circuit on Thursday found it did not have jurisdiction to hear BP’s appeal and, as a result, declined to rule on the merits. The panel reached its conclusion despite having rendered decisions in three previous appeals that challenged other aspects of the same settlement.

“At issue in each of these cases was more than the right to an accurate interpretation of a settlement agreement provision. The right in these cases is better characterized as the right to an interpretation of the settlement agreement on an issue with a serious impact on the effective and fair administration of the settlement,” wrote Chief Judge Carl Stewart (left). “By that measure, the disputed issue in this case does not stack up.”

A BP spokeswoman declined to comment.

Class counsel Steve Herman, a partner at New Orleans-based Herman Herman & Katz, and Jim Roy, a senior partner at Domengeaux Wright Roy Edwards & Colomb in Lafayette, Louisiana, said in an emailed statement: “Through its ruling, the Fifth Circuit has protected the independence and integrity of the claims process, yet still allowing full information to the parties if an individual appeal is warranted.”

The settlement, reached in 2012 to resolve claims for economic damages by local businesses and individuals tied to the Deepwater Horizon oil spill, is separate from the $18.7 billion deal BP reached this month with the federal government over environmental fines.

BP had appealed two 2014 rulings that blocked access to information about individuals or businesses whose claims were pending before a settlement administrator. Class counsel had moved to halt BP’s access after information about claimants, such as financial records, had appeared in major newspaper ads attacking potential fraud in the settlement. BP has access to the information once the administrator decides whether a claim is eligible for payment. But in a Nov. 4 appeal, BP argued that U.S. District Judge Carl Barbier’s rulings denying access before an award determination could hamstring the oil giant’s ability to identify potentially fraudulent claims.

BP claims it discovered $4 million in fraudulent claims already using such information, but barring it from access going forward could force it to “pay millions of dollars in fraudulent or improper awards.”

In a December 8 response, class counsel argued that the Fifth Circuit had no jurisdiction to hear the appeal.

The Fifth Circuit agreed, noting that its previous rulings addressed aspects of the settlement that could have affected thousands of claimants. “Here, by contrast, BP has shown a total of five claims in which this data appeared to have made any difference at all,” Stewart wrote.

In her dissent, Judge Jennifer Walker Elrod noted that in one of its previous decisions addressing the settlement, the Fifth Circuit had issued a ruling involving $1.2 million in awards given to just three nonprofit organization claimants.

“Despite the relatively small number of awards and amount in controversy, we recognized that the order had implications for the calculation of awards made to other nonprofits. A similar inference is appropriate here,” she wrote. “In this case, we deal not with potentially miscalculated awards, but rather with potentially fraudulent ones that should not have been awarded at all.”

IMAGE: Health, safety and environment workers contracted by BP clean up oil on a beach in Port Fourchon, La., May 23, 2010. Photo by Petty Officer 3rd Class Patrick Kelley, U.S. Coast Guard

5th Circuit Chief Judge Carl Stewart. HANDOUT.

For more on this story go to: http://www.nationallawjournal.com/id=1202732373043/BP-Loses-Appeal-to-Get-Spill-Claimants-Confidential-Info#ixzz3gCBjHAX8