BP shareholders consider ruling moving lawsuits to English court

Steve Korris Oct. 25, 2011, 5:17am


HOUSTON – Pension funds and other BP shareholders suing directors over the Deepwater Horizon explosion haven't decided whether to obey or appeal an order to move their action from federal court in Texas to the English High Court.

"Plaintiffs are assessing, in good faith and in consultation with English counsel, the feasibility of heeding the court's advice to pursue this action in England," Dona Szak of Houston wrote to U. S. District Judge Keith Ellison on Oct. 12.

She asked for 60 days, "to investigate and assess the potential risks and benefits of pursuing this important derivative suits in the courts of England without having the burden of simultaneously pursuing an appeal in the federal court system."

Szak urged Ellison to amend an order dismissing the case in ways that would blur the line between American and English jurisdiction.

She asked him to require BP directors to waive statute of limitation defenses.

She asked that the directors not be able to object to admission of discovery from Ellison's court and separate multi district proceedings in New Orleans and for them to conduct discovery in the United States in accordance with federal rules of procedure.

"Plaintiffs have had extensive discussions with several English lawyers regarding the procedural and substantive aspects of pursuing this shareholder derivative action in the English High Court," she wrote.

"Plaintiffs are continuing to analyze certain procedural issues, including the court findings that need to be made, statute of limitations issues, and the timing of bringing the matter to a final adjudication," she wrote.

Szak leads a team that filed a consolidated complaint in February, on behalf of the New Orleans city pension fund, the Louisiana police pension fund, the Southeast Pennsylvania Transportation Authority and seven individuals.

They sought relief under the Companies Act, a new British law.

BP moved to dismiss for a more convenient forum at the English High Court, and Ellison granted the motion in September.

"Defendants have offered evidence that the Companies Act expressly permits litigation of derivative claims before the English High Court," Ellison wrote. "Plaintiffs do not dispute that the courts of England provide an adequate forum in which to litigate their claims."

He wrote that most of the relevant documents were at BP headquarters in London, and that BP directors meet in England and maintain their records there.

"The primary concern of this derivative litigation is the internal affairs of an English corporation, and the suit seeks to recover damages for the benefit of BP only.

"Accordingly, England has a greater interest in the resolution of this dispute," he wrote.

As of Oct. 24, BP hadn't responded.

More News