Anadarko must arbitrate claims against BP, says MDL judge

Steve Korris Jul. 19, 2011, 5:15am

NEW ORLEANS � Splitting a double header in federal court, Deepwater Horizon rig investor Anadarko Petroleum lost a contest against joint operator BP and won a contest in writing the plan for the first trial over last year's explosion and oil spill.

Anadarko heard good news on July 8, when U. S. District Judge Carl Barbier told all parties he would largely adopt its plan for a fault allocation trial starting in February.

Bad news followed on July 15, when Barbier ruled Anadarko must arbitrate claims it tried to bring against BP in his court.

He rejected Anadarko's plea that BP waived its right to compel arbitration when it gathered evidence against Anadarko in his court.

"Anadarko has not met its heavy burden of demonstrating waiver," he wrote.

"BP did not substantially invoke the judicial process by its limited actions," he wrote.

He wrote that BP identified four Anadarko employees on a list of potential witnesses and examined one.

He wrote that BP served three requests for production on related parties and asked a few dozen questions at depositions of related parties.

"Notably, BP has not filed cross claims against Anadarko, nor has it answered Anadarko's cross claims against it � actions which, if taken, would have tended to show waiver," he wrote.

"Furthermore, BP's discovery requests submitted to Anadarko were expressly conditioned on the outcome of this dispute," he wrote.

Anadarko held 25 percent interest in the rig operation.

Barbier tossed its action against BP out of his court a week after endorsing a trial plan Anadarko proposed in competition with all major parties in the litigation.

The trial will hinge on a petition from rig owner Transocean to limit its liability to the value of the vessel, about $26 million, under a law 160 years old.

In Anadarko's plan, Ky Kirby of Washington calls for trial in three phases.

A first phase would address the loss of well control, the fire and explosion, the sinking of the rig, and the initiation of the oil release.

"First, the plaintiff steering committee shall adduce factual and expert evidence in support of the plaintiffs' claims against all defendants," she wrote.

"Second, Transocean shall present factual and expert evidence on its exoneration, limitation, and liability defenses, as well as its counter and cross claims and third party claims against any third party defendants," she wrote.

"Third, the third party defendants shall present their factual and expert evidence in support of their defenses to plaintiffs' claims and any other defendants' counter and cross claims against them, and in support of their counter and cross claims and third party claims against other defendants," she wrote.

Last, she wrote, the plaintiff steering committee would present rebuttal evidence.

The second phase of the trial would pertain to stopping the release.

The third would address efforts to contain the oil and would establish how oil migrated and where it ended up.

Barbier would enter orders later for the second and third phases, Kirby wrote.

She wrote, "All parties shall present evidence relevant to a particular phase during that phase and should not expect they will be permitted to fill evidentiary gaps in one phase by presentation of evidence in a subsequent phase."

More News