United States v. BP Exploration and Production, Inc.
United States v. BP Exploration and Production, Inc.
Court Docket Number: 2:12-cr-00292-SSV-DEK
Before the Honorable Sarah S. Vance, Courtroom C279, United States District Court for the Eastern District of Louisiana, Federal Courthouse Building, 500 Poydras Street, New Orleans, LA 70130.
On January 29, 2013, Judge Sarah S. Vance accepted BP’s guilty plea for its illegal conduct leading to and following the 2010 Deepwater Horizon disaster. BP pleaded guilty to each count charged in a 14 count information filed in U.S. District Court in the Eastern District of Louisiana, including 11 counts of felony manslaughter, one count of felony obstruction of Congress and violations of the Clean Water and Migratory Bird Treaty Acts, and was sentenced to pay $4 billion in criminal fines and penalties. During the guilty plea and sentencing proceeding, Judge Vance found, among other things, that the consequential fines imposed under the plea agreement far exceed any imposed in U.S. history, and are structured so that BP will feel the full brunt of the penalties. She also noted that the agreement provides just punishment and significant deterrence, requiring detailed drilling safeguards, monitors and other stringent, special conditions of probation so that BP’s future conduct will be closely watched. Please see the hyperlinks below for Judge Vance’s Reasons For Accepting Plea Agreement and the Order applicable to BP during BP’s probation.
In pleading guilty, BP admitted that, on April 20, 2010, the two highest-ranking BP supervisors onboard the Deepwater Horizon, known as BP’s “Well Site Leaders” or "company men," negligently caused the deaths of 11 men and the resulting oil spill. The company also admitted that on that evening, the two well site leaders observed clear indications that the Macondo well was not secure and that oil and gas were flowing into the well, but chose not to take obvious and appropriate steps to prevent the blowout. Additionally, BP admitted that as a result of the Well Site Leaders’ conduct, control of the Macondo well was lost, resulting in catastrophe.
BP also admitted during its guilty plea that the company, through a senior executive, obstructed an inquiry by the U.S. Congress into the amount of oil being discharged into the Gulf while the spill was ongoing. BP also admitted that the senior executive withheld documents, provided false and misleading information in response to the U.S. House of Representatives’ request for flow-rate information, manipulated internal estimates to understate the amount of oil flowing from the well and withheld data that contradicted BP’s public estimate of 5,000 barrels of oil per day. At the same time that the senior executive was preparing his manipulated estimates, BP admitted, the company’s internal engineering response teams were using sophisticated methods that generated significantly higher estimates. The Flow Rate Technical Group, consisting of government and independent scientists, later concluded that more than 60,000 barrels per day were leaking into the Gulf during the relevant time, contrary to BP’s representations to Congress.
According to the sentence imposed by Judge Vance pursuant to the plea agreement, more than $2 billion dollars will directly benefit the Gulf region. By order of the court, approximately $2.4 billion of the $4 billion criminal recovery is dedicated to acquiring, restoring, preserving and conserving – in consultation with appropriate state and other resource managers – the marine and coastal environments, ecosystems and bird and wildlife habitat in the Gulf of Mexico and bordering states harmed by the Deepwater Horizon oil spill. This portion of the criminal recovery will also be directed to significant barrier island restoration and/or river diversion off the coast of Louisiana to further benefit and improve coastal wetlands affected by the oil spill. An additional $350 million will be used to fund improved oil spill prevention and response efforts in the Gulf through research, development, education and training.
BP was also sentenced to five years of probation – the maximum term of probation permitted under law. The company is also required, according to the order entered by the court pursuant to the plea agreement, to retain a process safety and risk management monitor and an independent auditor, who will oversee BP’s process safety, risk management and drilling equipment maintenance with respect to deepwater drilling in the Gulf of Mexico. BP is also required to retain an ethics monitor to improve its code of conduct to ensure BP’s future candor with the U.S. government.
Transocean Deepwater Inc. Convicted and Sentenced: On February 14, 2013, Judge Jane Triche Milazzo accepted Transocean’s guilty plea to an information charging the company with one count of violation of the Clean Water Act and sentenced the company to pay $400 million in criminal fines and penalties. The plea agreement was reached in January 2013 but had required the review and approval of Judge Milazzo. For more information on the conviction and sentencing of Transocean Deepwater, please visit the case page at U.S. v. Transocean Deepwater Inc. (Criminal No. 13-cr-001-JTM-SS).
In a related case, Robert M. Kaluza and Donald J. Vidrine are charged in the Eastern District of Louisiana with 11 felony counts of seaman’s manslaughter, 11 felony counts of involuntary manslaughter and one violation of the Clean Water Act. Trial is set for January 13, 2014 at 8:30 a.m. before U.S. District Judge Stanwood R. Duval, Jr. in Courtroom 352, 500 Poydras Street, New Orleans, LA 70130. And, a pretrial conference will be held on December 11, 2013 at 1:30 p.m. If convicted, Kaluza and Vidrine each face a maximum potential penalty of 10 years in prison on each seaman’s manslaughter count, up to eight years in prison on each involuntary manslaughter count, and up to a year in prison on the Clean Water Act count. In addition, on June 19, 2013, former BP executive David I. Rainey, who served as a Deputy Incident Commander and BP’s second-highest ranking representative at Unified Command during the spill response, was charged in a superseding indictment with obstruction of Congress and making false statements to law enforcement officials during the investigation into the 2010 oil spill. Rainey’s trial is set for October 15, 2013 at 8:30 a.m. before U.S. District Judge Kurt D. Engelhardt in Courtroom C-351, 500 Poydras Street, New Orleans, LA 70130. A pretrial conference will be held on October 3, 2013 at 9:00 a.m., also before Judge Engelhardt. If convicted, Rainey faces a maximum potential penalty of five years in prison on each count. Rainey originally was indicted on those same charges in November 2012.
The written information on this webpage will be updated as new developments arise.