BP is facing a flood of legal claims from big British investors over the Gulf of Mexico spill after it lost a crucial courtroom battle in Texas to get their cases thrown out.
The investors, which include pension funds for several London boroughs and BP’s arch rival, Shell, are suing in the US, where they are likely to win far-bigger payouts than they could in Britain.
BP, headed by chief executive Bob Dudley, pictured, had argued claimants should be forced to have their cases heard in England, but US District Judge Keith P Ellison has just rejected the argument in a series of key rulings that could lead to many other foreign investors flocking to the US courts.
Westminster Council, the Royal Borough of Kensington and Chelsea and dozens of other pension funds are suing for compensation due to the collapse in the price of both BP shares traded in London and its New York Stock Exchange shares known as American Depository Receipts.
The British investors are being represented by the class-action lawsuit specialist Pomerantz Law, whose partner, Jeremy Lieberman, said of the judgements: “These decisions are ground-breaking.”
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He said they establish for the first time that cases involving losses to foreign-traded shares can still be heard in the US, especially if the events surrounding the claim — in this case the Deepwater Horizon disaster – occurred in America.
“Critically, UK pension funds and asset managers, who suffered significant losses related to their BP investments, will now have their day in court to recoup losses for their fiduciaries,” he added.
Pomerantz has assembled more than 30 major BP shareholders from the UK, France, Canada, Holland and Australia to sue for the losses incurred on the shares they bought before the 2010 explosion, which led to 11 deaths and happened under the stewardship of then chief executive Tony Hayward.
Other investors are likely to join the suit, which is being prosecuted on a no-win-no-fee basis.
A BP spokesman said: “BP believes that all of the plaintiffs’ securities claims relating to the Deepwater Horizon accident are meritless, and it will continue to vigorously dispute them.”Reuse content