Appeal Panel Decisions XIII - Deepwater Horizon

471 Pages·2014·11.15 MB·English

APPEAL PANEL DECISION FORM
I. CLAIMANT AND CLAIM INFORMATION
Last/Name of Business First Middle
Claimant Name

Claimant ID Claim ID
Claim Type Business Economic Loss
Law Firm
II. DECISION
Denial Upheld
Denial Overturned
III. PRIMARY BASIS FOR PANELIST DECISION
Please select the primary basis for your decision. You may also write a comment describing the basis for your
decision.

Claim should have been excluded.

Claim should have been denied.

Claim should not have been excluded.

Claim should not have been denied.

No error.

Comment (optional):

Decision uploaded in portal.
appeals the denial of its BEL Claim. The Settlement
Program found the claimant to be a real estate developer and, thus, excluded by
Section 2.2.4.7 of the Settlement Agreement.
Claimant is a single-member LLC whose parent company,
is a holding company with interests in several other companies that
own and manage retail and office space. The parent company filed consolidated tax
returns for all of these companies, one of which was Claimant. The Settlement Program
reviewed the consolidated returns, as well as the website of “ ” and
concluded that the claim should be excluded. While the operations of the parent
company would likely meet the definition of an excluded real estate developer, Claimant
submitted additional information distinguishing the activities of the claimant as merely
the management company. According to Claimant’s CPA, Claimant owns no properties,
does not develop properties, and any income on the consolidated return that
demonstrated otherwise related to a separate company, . BP has
objected to the Panel’s consideration of this additional information as being untimely,
yet did not specifically refute it. BP also noted that in 2010, Claimant helped tenants
complete build-outs of their leased spaces, although the record indicates that income
amounted to .002% of Claimant’s 2010 income.
The Settlement Program relied heavily upon Policy 299, as did the parties in their
respective memoranda. Policy 299 has since been superseded by Policy 468. The
determination of whether a claimant is an excluded real estate developer is, admittedly,
a subjective one. The record demonstrates confusion as to whether the Settlement
Program analysts considered the activities of just the claimant company or the broader
activities of the parent holding company. Though not specified in the record, it is
reasonable to conclude that the website reviewed was that of the parent company, not
the claimant. If so, it is easily understood how the Settlement Program could have
concluded that claimant was a developer. However, as Claimant correctly notes, the
exclusion decision is to be made at the entity level, and this confusion seems to be
clarified by the additional documents submitted by the claimant which were not made
available to the Settlement Program at the time the claim was denied. Despite BP’s
objection, the Appeals Panel review is de novo, and I have considered this additional
information.
Were remand an option, I would remand this claim for consideration in light of the
additional information submitted by Claimant and the addition of Policy 468. Since it is
not, I cannot conclude that the record before me conclusively shows that this claimant
should be excluded. I therefore find that the claim should not have been excluded and
overturn the denial.
APPEAL PANEL DECISION FORM
I. CLAIMANT AND CLAIM INFORMATION
Last/Name of Business First Middle
Claimant Name

Claimant ID Claim ID
Claim Type Individual Economic Loss
Law Firm
II. DECISION
Select the Compensation Amount set forth in either BP’s Final Proposal or the Claimant’s Final Proposal as the
final outcome on the claim and check the appropriate box to signify your decision.
Compensation Amount $0
BP’s Final Proposal Risk Transfer Premium .25
Prior Payment Offset
$0
Compensation Amount
$70,626.44
Claimant’s Final Proposal Risk Transfer Premium
.25
Prior Payment Offset
$0
III. PRIMARY BASIS FOR PANELIST DECISION
Please select the primary basis for your decision. You may also write a comment describing the basis for your
decision.

Error in documentation review.

Error in calculation.

Error in RTP multiplier.

Error in Prior Spill-Related Payment Amount.

No error.

Comment (optional):

BP appeals this IEL award to a commissioned salesman of manufactured homes. His employer's SWS-12 attests
that Claimant has sustained up to a 22% decrease in sales since the Spill, explaining that the majority of the
customer base in Claimant's sales area are employed by industries affected by the Spill, and also that pricing for
such homes has significantly increased as the post-Spill cost of oil has increased. Although BP requests in its
briefs a remand of this matter to analyze figures it suggests would show an equal or greater trend of decreased
income before the Spill, it did not assign this as an error in its Notice of Appeal, as required by Appeal Rules 9
and 14. Alternatively, a de novo review of the Administrator's analysis confirms its findings, obviating the need
for a remand. Ultimately BP's only preserved appellate issue is that as a commissioned (non-salaried) employee,
Claimant did not merit an Industry Growth Factor increase in his award. Claimant has agreed, and has reduced
his final demand to deduct that portion of his award. Though in brief it proposes a pre-RTP award of $15,000.00
(without explanation), BP's only proposal on the portal is $0. Under the baseball process we are directed to
apply, this panelist must accept the proposal of Claimant.
APPEAL PANEL DECISION FORM
I. CLAIMANT AND CLAIM INFORMATION
Last/Name of Business First Middle
Claimant Name

Claimant ID Claim ID
Claim Type Business Economic Loss
Law Firm
II. DECISION
Select the Compensation Amount set forth in either BP’s Final Proposal or the Claimant’s Final Proposal as the
final outcome on the claim and check the appropriate box to signify your decision.
Compensation Amount $37,764
BP’s Final Proposal Risk Transfer Premium 1.50
Prior Payment Offset
$0
Compensation Amount
$47,198.32
Claimant’s Final Proposal Risk Transfer Premium
1.50
Prior Payment Offset
$0
III. PRIMARY BASIS FOR PANELIST DECISION
Please select the primary basis for your decision. You may also write a comment describing the basis for your
decision.

Error in documentation review.

Error in calculation.

Error in RTP multiplier.

Error in Prior Spill-Related Payment Amount.

No error.

Comment (optional):

see reasons submitted to appeals coordinator
APPEAL DECISION
#

This is a BEL Claim. Claimant is a dentist. BP has appealed the award, arguing that the
Claims Administrator did not properly match Claimant’s expenses with revenues.
The Court has held that the Settlement Agreement requires matching. In response, the
Claims Administrator developed Policy 495, which sets forth a protocol for processing claims to
determine whether or not expenses sufficiently match revenue. This Policy has been approved
by the Court.
In the instant matter, Claimant’s financials were processed using the initial seven criteria
set forth in Policy 495. None of the seven criteria were triggered. Consequently, the Claim was
presumed to be sufficiently matched.
Although BP acknowledges that on an annual basis, the ratio of “supplies” and “lab”
expenses to revenue are fairly consistent (and thus sufficiently matched), BP argues that the
monthly variances for these two expenses suggest otherwise. In particular, BP focuses on
monthly expenses for “supplies” and “lab” and suggests that these expenses vary “wildly”
relative to monthly revenue. For example, the ration for “supplies” ranged from 2.32% to
13.88% and the ratio for “lab” from 2.7% to 17.6%.
That said, BP does not offer any evidence that the seven criteria set forth in Policy 495
was misapplied. An examination of the monthly “supplies” and “lab” expenses do not show a lot
of variances but rather a few months where these expenses spiked high or low. Further, BP only
selected two expense categories out of a number of categories. A review of all of the expense
categories suggest that the annual and monthly ratio of expenses to revenue is fairly consistent,
which would explain why the Claim did not trigger any of the seven criteria.
Accordingly, the Panelist adopts Claimant’s Final Proposal.
APPEAL PANEL DECISION FORM
I. CLAIMANT AND CLAIM INFORMATION
Last/Name of Business First Middle
Claimant Name

Claimant ID Claim ID
Claim Type Business Economic Loss
Law Firm
II. DECISION
Select the Compensation Amount set forth in either BP’s Final Proposal or the Claimant’s Final Proposal as the
final outcome on the claim and check the appropriate box to signify your decision.
Compensation Amount
$25,448.50
BP’s Final Proposal Risk Transfer Premium 1.50
Prior Payment Offset
$60,000
Compensation Amount
$25,448.50
Claimant’s Final Proposal Risk Transfer Premium
2.50
Prior Payment Offset
$60,000
III. PRIMARY BASIS FOR PANELIST DECISION
Please select the primary basis for your decision. You may also write a comment describing the basis for your
decision.

Error in documentation review.

Error in calculation.

Error in RTP multiplier.

Error in Prior Spill-Related Payment Amount.

No error.

Comment (optional):

BP appeals this business economic loss award to the BP argues that this
claimant was not entitled to a tourism designation and , therefore, takes exception with the RTP applied in this
case. The response by claimant's counsel ,which consisted mainly of boilerplate statements, made this case a
close call. However, it was pointed out that the chamber promotes a music festival and the chamber's P and L
statements show the profit from this event is almost double what it receives from membership dues. Claimant
contends the marketing for this event is directly primarily to tourists.
Despite this bare level of detail, due to the claimant friendly nature of this process and the claimant's location
in a tourist area, it is appropriate to find that the claims administrator was correct in applying the tourism
designation. BP makes reference to claimant's NAICS code. However, this issue is not controlling. The test is
based on a totality of circumstances.
APPEAL PANEL DECISION FORM
I. CLAIMANT AND CLAIM INFORMATION
Last/Name of Business First Middle
Claimant Name

Claimant ID Claim ID
Claim Type Business Economic Loss
Law Firm
II. DECISION
Select the Compensation Amount set forth in either BP’s Final Proposal or the Claimant’s Final Proposal as the
final outcome on the claim and check the appropriate box to signify your decision.
Compensation Amount $0
BP’s Final Proposal Risk Transfer Premium 1.50
Prior Payment Offset
$0
Compensation Amount
$24,996.13
Claimant’s Final Proposal Risk Transfer Premium
2.50
Prior Payment Offset
$0
Remand to Claims Administrator
III. PRIMARY BASIS FOR PANELIST DECISION
Please select the primary basis for your decision. You may also write a comment describing the basis for your
decision.

Error in documentation review.

Error in calculation.

Error in RTP multiplier.

Error in Prior Spill-Related Payment Amount.

No error.

Comment (optional):

See attached opinion uploaded in the portal.
DWH:
Claim ID:
Written Reasons and Opinion:
This is a claimant appeal of a Business Economic Loss award made by the Claims Administrator
in the amount of $24,996.13 Pre-Risk Transfer Premium. The claimant is a Key West, Florida,
rental property owner. He asserts that the Claims Administrator committed error in not awarding
his business a Tourism classification. He does not quarrel with the amount awarded and makes
no further claim of error.
BP, in response, argues that the award ought to be vacated because (1) Claimant is not a Class
Member; (2) Claimant did not suffer Compensable Economic Damage; and (3) Claimant should
have filed a Failed Business claim rather than a Business Economic Loss claim, and under the
Failed Business Compensation Framework, Claimant is not entitled to
compensation. Alternatively, BP argues that Claimant’s “Cross Appeal” should be denied for
the reason that Claimant’s property rental business does not qualify for the Tourism designation.
This is a Claimant appeal, not a BP appeal. BP cannot attack the original award. The following
Appellate Rules apply:
Rule 7. Type of Notices Appealable to the Appeal Panel.
Rule 7 (b) Appeals by BP: BP may appeal to the Appeal Panel any Eligibility
Notice where the Compensation Amount awarded in such Notice, before the
application of any Risk Transfer Premium, is in excess of $25,000. BP may not
appeal any Denial Notice or any Eligibility Notice where the Compensation
Amount awarded in such Notice, before the application of any Risk Transfer
Premium, is $25,000 or less. (Emphasis Supplied)
* * *
Rule 9. Consolidated Appeal Process for Each Appealable Claim. After BP or
the claimant initiates an Appeal as the appellant, the appellee shall raise any and
all appealable issues within the same appeal when it submits its Initial Proposal
and may not initiate a separate appeal for the claim. The original appellant shall
be limited to the issues raised in its Notice of Appeal, except as necessary to
respond to new issues raised by the appellee in its Initial Proposal. The appellee
shall be limited to the issues raised in its Initial Proposal. The Appeal Panelist
shall not consider issues raised by either the appellant or the appellee after the
Notice of Appeal and/or Initial Proposal, as provided in this Rule. (Emphasis
Supplied)
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