BP in $7.8bn settlement of gulf claims BP and the lawyers representing tens of thousands of victims of the 2010 Gulf of Mexico oil spill have reached an $7.8bn out-of-court settlement over damages, delaying the trial that had been due to start on Monday. In a statement on Friday night, Judge Carl Barbier of the federal district court in New Orleans said "plaintiffs" counsel and counsel for BP have reached an agreement on the terms of a proposed class settlement which will be submitted to the court for approval." Even after a deal with the private sector, BP would still proceed to trial with the US Department of Justice and states from the Gulf of Mexico region, which are seeking civil penalties and damages that could run into the tens of billions of dollars. Judge Barbier said that phase would be postponed to a date to be decided later. The trial had originally been scheduled to start on February 27, but was delayed a day before when BP and the private sector plaintiffs said they were working on a deal. Lawyers representing 116,000 plaintiffs, including fisherman, restaurant owners and others hurt by the spill have focused on a plan for a settlement using about $13bn remaining from the $20bn that BP pledged for victims of the spill in June 2010, two months after the accident. There are also disputes over responsibility for the disaster between BP and other companies working on the Deepwater Horizon drilling rig, including Transocean, which owned and operated the rig, and Halliburton, which provided cement to seal the well. Transocean said in a statement it was still ready to go to trial. "Delays or deals made by other players do not change the facts of this case and we are fully prepared to argue the merits of our case based on those facts," it said. Separately, the DoJ is investigating BP and other companies for possible criminal charges. David Uhlmann, a former head of the environmental crimes section at the DoJ, said: "Tonight's settlement announcement is good news for the victims of the Gulf oil spill who will see their losses compensated much more quickly than the victims of the Exxon Valdez oil spill. It also paves the way for BP to negotiate agreements with the federal and state governments. Talks have been held over a possible resolution of those actions. BP has said it is willing to do a deal, providing it believes the price is fair. Now that a headline agreement has been reached with the private sector plaintiffs, there will still be a huge effort needed to divide up the money to pay individual claims. One of the central issues for any settlement is likely to be the number of claimants that will be able to benefit; a question that is still vigorously debated. Some lawyers argue that the figure of 116,000 is an overestimate, because individuals and businesses are eligible to sue under the 1990 Oil Pollution Act only if they have first filed a claim with the Gulf Coast Claims Facility, the compensation fund backed by $20bn promised by BP. Ken Feinberg, the Washington lawyer who is the administrator of the GCCF, says that only 53,001 claimants in the legal action have filed claims with the fund, of whom 14,186 have actually been paid and signed a form releasing BP from any further claims. That would leave about 39,000, of whom about 27,000 have had their claims rejected by the GCCF for various reasons and about 1,000 are being investigated for fraud. Only the remainder, about 11,000 people, would have an undisputed right to sue. However, other lawyers have suggested the final total could be much greater than the PSC's figure. Claimants have three years from the accident in April 2010 to come forward. Speaking before the settlement was announced, Brent Coon, a Texas-based lawyer with clients in the case said: "We won't know until April 2013 how many claimants there are. And even after that, it could be months or years before we can look at all the claims collected to get a good sense of how much they are worth. However, another lawyer involved in the case, also speaking before the deal announcement, said it should be possible to come to an estimate of the number of potential claimants and the value of their claims. "It's not really that hard"" said Gerry Nolting, who was one of the attorneys that led the fight against Exxon for damages from the 1989 Exxon Valdez spill. In the state of Louisiana, people get certified to catch shrimp. You can count the number of shrimpers, oyster-fishers, crabbers, restaurant owners, and so on. We've made estimates based on looking at the data. It's not this great mystery. Mr Coon warned that even after a settlement, there would be some claimants who were not satisfied and would insist on going to court. "There may be multiple trials, as there have been over asbestos," he said. Putting it all together with a bow on top may be a convenient resolution, but it may not be an appropriate resolution.