Posts Tagged ‘claims’

Begging for Oil Spill Resolution

Wednesday, September 15th, 2010

BP Oil Spill ClaimsAlthough the oil spill has been contained, the effects continue for the Gulf Coast residents. Kenneth Feinberg was appointed weeks ago to mediate the claims process, however issues are far from resolved. CBS News reports:

When Feinberg took over the claims process three weeks ago he promised checks to individuals in 48 hours, businesses in seven days.

Before Feinberg took over, BP paid out $395 million. In the past three weeks, Feinberg has paid $185 million. Of the 60,000 claims before him, half are still being processed despite his promises of a quick resolution. Only 16,000 have been paid. Fourteen-thousand have insufficient paperwork to back them up.

Although Feinberg was appointed as the “mediator” to resolve claims related to the BP oil spill and administer the $20 billion fund set up by BP to cover losses, his role appears to much more that of “claims adjuster” as opposed to a mediator.

Mediation is neutral, voluntary, confidential, and transparent. A mediator must be chosen by the participants if mediation is to be successful – otherwise mediation does not occur.

Claims adjusters are not mediators. Although Feinberg is not an employee of BP, he has been charged with determining how and when the $20 billion is settled among those who experienced a loss as a result of the oil spill; his role seems far more aligned with a claims adjuster than with a mediator.

A comprehensive mediation program allows for the claimants and the BP adjusters to meet with a mutually chosen mediator who can facilitate a resolution to the claim that makes sense to both sides.

Additional Information:

678Partners Interviews CFR Mediation

Monday, July 12th, 2010

678Partners interviews CFR Mediation about the use of mediation to address disputed claims in the BP Oil Spill.

CFR president and founder, Erin Johnston, is interviewed along with Nima Taradji, JD, LLM about the different types of dispute resolution (mediation, arbitration, and litigation) and specifically the positive role mediation can play in the resolving BP Oil Spill claims that are in dispute.

Watch the Slide Show Here. 678 Partners asks CFR how mediation can yield lower costs, produce win-win results, and leave less emotional strain in comparison to arbitration and litigation. Amir Homayoun Rafizadeh on Vimeo.

Mediating Oil Spill Claims

Tuesday, June 15th, 2010

It seems that everywhere you turn – even official sources like our president Barack Obama, BP CEO Tony Hayward, or US Coast Guard Admiral Thad Allen – everyone it talking about the “independent mediator” that BP is “hiring” or in their own words “appointing” to address claims not resolved satisfactorily by BP Oil Spill Claims Process.

Unfortunately if this is occurring it seems far less than transparent.  Which causes our original concerns to come to mind:

Although mediation can, without a doubt, be helpful in the resolution of claims related to damages from the oil spill, it is imperative that the tenants of mediation be upheld.

  • Mediator Neutrality – By appointing the “independent mediator”, is not BP exerting primary and initial influence on the mediator?  Parties in conflict who choose mediation ideally have equal say in who is the mediation provider.  This is one of the basic means of ensuring that the mediator is truly a neutral participant.
  • Power Equity – It is hard to imagine a fisherman, small restaurateur, the widow of a rig-worker, beach-front property owner, or even coastal town government having equal power in a dispute with the multi-national and heavily moneyed BP.  Most losses attributed to the spill, while huge to the claimant, are dwarfed by the annual profits of BP (which BP reported to shareholders as $16.5 billion in 2009).  For mediation to be successful, this inherent inequity must be addressed in the design of the BP mediation program.
  • Voluntary – Participation in mediation is voluntary.  Generally anything that can be litigated can be mediated – resulting in a resolution that is more satisfactory to both parties.  However, BP is in a position of addressing thousands of claims from people who have experienced a loss or hurt from what they see as a result of decisions or actions of BP.  It is likely that claimants will see themselves as “victims” of BP.  Filing a claim and seeking a settlement through mediation as opposed to traditional litigation may not be the claimants first choice.  Participants may find themselves in mediation without fully engaging in the process and/or voluntarily participating.

Although these are significant obstacles to mediation, BP can create a “Mediation Program” to address the damage claims resulting from the oil spill that results in claims being resolved in a “win-win” manner while still assuring BP’s continued viability in the field and the region.

Mediation Engaged to Respond to BP Oil Spill

Monday, June 14th, 2010

Oil Spill MediationLate in May, while hope remained that the “Top Kill” effort to stem the leak was working, BP announced that it would be appointing a mediator to facilitate claim resolution.

BP announced that it will appoint an Independent Mediator to review and assist in the claims process for the spill associated with the exploratory well that was being drilled by the Transocean Deepwater Horizon in Mississippi Canyon, Block 252.

Although mediation can, without a doubt, be helpful in the resolution of claims related to damages from the oil spill, it is imperative that the tenants of mediation be upheld.

  • Mediator Neutrality – By appointing the “independent mediator”, is not BP exerting primary and initial influence on the mediator? Parties in conflict who choose mediation ideally have equal say in who is the mediation provider. This is one of the basic means of ensuring that the mediator is truly a neutral participant.
  • Power Equity – It is hard to imagine a fisherman, small restaurateur, the widow of a rig-worker, beach-front property owner, or even coastal town government having equal power in a dispute with the multi-national and heavily moneyed BP. Most losses attributed to the spill, while huge to the claimant, are dwarfed by the annual profits of BP (which BP reported to shareholders as $16.5 billion in 2009). For mediation to be successful, this inherent inequity must be addressed in the design of the BP mediation program.
  • Voluntary – Participation in mediation is voluntary. Generally anything that can be litigated can be mediated – resulting in a resolution that is more satisfactory to both parties. However, BP is in a position of addressing thousands of claims from people who have experienced a loss or hurt from what they see as a result of decisions or actions of BP. It is likely that claimants will see themselves as “victims” of BP. Filing a claim and seeking a settlement through mediation as opposed to traditional litigation may not be the claimants first choice. Participants may find themselves in mediation without fully engaging in the process and/or voluntarily participating.

Although these are significant obstacles to mediation, BP can create a “Mediation Program” to address the damage claims resulting from the oil spill that results in claims being resolved in a “win-win” manner while still assuring BP’s continued viability in the field and the region.

Alabama Gov: Are Claims Being Filed with BP?

Monday, June 14th, 2010

It would not be surprising to learn that Gulf residents and business owners may be hesitant to file a claim with BP for oil spill losses.  Perhaps there is a sense of futility -  perhaps there is confusion as to how to file claims.

As of June 8,  Alabama governor Bob Riley has called in the National Guard and staff from the Alabama Emergency Management Agency to assist Alabama residents in filing claims related to losses due to the BP oil spill.  They will operate in teams throughout  Alabama coastal areas to assist residents and business owners.

BP has made information related to filing a claim available online – www.deepwaterhorizonresponse.com.  BP has continued to state that they will review all claims and make a determination within 48 hours of receipt.  All claims found to be valid will be paid within that same 48 hour window.

Additional story at WKRG

AEHR Concerned About BP Claims Processor: ESIS

Friday, June 11th, 2010

Advocates for Environmental Human Rights (AEHR),  a nonprofit, public interest law firm, has expressed concern that ESIS, the company that BP has chosen to manage the oil spill claims process, reports that the goal of its “Recovery Services” is to “reduce our client’s loss dollar pay-outs”.

Nolo.com reports that as of Thursday the 10th, BP reports 49,988 claims have been filed with current payment totaling $55.5 million. Although, not a paltry sum on it own, it averages out to $1,110 per claim filed. Although BP reports no claims related to the oil spill have been denied to date, Admiral Thad Allen did express concern to BP CEO Tony Hayward regarding the significant number of claims that have simply not been acted on.

Efforts are continuing to be made to increase transparency and accountability in the oil spill claims process both by BP and their claims processor ESIS.

Obama Administration Requests BP Oil Spill Claims Transparency

Thursday, June 10th, 2010

US Coast Guard Admiral Thad Allen has requested more transparency from BP regarding claims processing.

In anticipation to his scheduled meeting with senior claims team members the next day, Adm. Allen wrote a letter to BP CEO Tony Hayward on June 8, asking for:

  • Additional information to assess how well the [established claims] process is meeting the critical needs of individuals, families, and businesses whose livelihoods are being impacted by the spill.
  • Access to the BP claims database with personally identifiable information removed (specific data and field requests attached).
  • Discussion as to delayed processing times for large loss claims; pending claims with no action taken; and payment calculations for individual income losses.
  • Information into continued payment plans.
  • Information on the mediation plan BP is putting in place.

The full transcript of of the letter can be found here

Alabama Gov: Are Claims Being Filed with BP?

Wednesday, June 9th, 2010

It would not be surprising to learn that Gulf residents and business owners may be hesitant to file a claim with BP for oil spill losses.  Perhaps there is a sense of futility -  perhaps there is confusion as to how to file claims.

As of June 8,  Alabama governor Bob Riley has called in the National Guard and staff from the Alabama Emergency Management Agency to assist Alabama residents in filing claims related to losses due to the BP oil spill.  They will operate in teams throughout  Alabama coastal areas to assist residents and business owners.

BP has made information related to filing a claim available online – www.deepwaterhorizonresponse.com.  BP has continued to state that they will review all claims and make a determination within 48 hours of receipt.  All claims found to be valid will be paid within that same 48 hour window.

Additional story at WKRG

BP Oil Spill Mediation…No News?

Tuesday, June 1st, 2010

BP Oil Spill ClaimsAlthough BP spoke of “appointing” a neutral mediator a week ago – there seems to no further mention of the planned mediation, much less how the plan will address the potential pitfalls to mediator involvement as designed by BP.  Regardless of the appointee, it is paramount that the designated mediator be just that – a mediator, not an appeals levels claims adjuster.

For true mediation to occur the mediator must be a neutral person who is chosen by the parties – both parties.  BP must create a program that supports this position not in name, but also program design.  A mediator that works for one claimant, may not be the best mediator for another.

In addition, a person with a claim against BP is going to be hard pressed to experience any interaction with BP claims adjusters as one of equal power in the resolution. Mediation does not permit this power inequity.  Mediation, even between individuals and BP, should be a focused conversation that addresses a plan for complete restitution – a plan that is deemed reasonable to both sides of the claim.

CFR is available to mediate claims against BP for damages related to the Gulf of Mexico Oil Spill, our focus remains on the promotion of efficient, effective, and fair resolution of issues.

See Also: Mediation Engaged to Respond to BP Oil Spill