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  • ilikeembrown ilikeembrown Feb 28, 2012 1:39 PM Flag

    Don't settle

    I think the $20bilion set aside for civil liabilities includes state suits. There will not be a settlement, too many politicians involved. Imagine if (when) Texas, Louisiana, Mississippi, Alabama, and Florida State governments file claims of economic loss. Fishing industry is nothing compared to tourism. I know I canceled my vacation in Clearwater due to the spill. Getting away for $20billion (pipe dream) will seem cheap when each state claims billions in tax revenue losses, then they can add punitive $ on top of that. And you never hear about Mexico; huge tourist industry ruined by the spill. And the huge potential fines. Is the possibilty that BP is found grossly negligent priced into the stock? BP should divest into many small pieces so that there is no part big enough to sue anymore. Or, spin off a "BP America" division and file for bankruptcy.

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    • I hate to bust your bubble, but the political fix was in when BP put up the $20 billion. They didn't have to, but did so. BP also pumped billions into the cleanup which put all those fishermen to work making far more than they would have pulling shrimp from the pots. Tourism was going down due to the economy that Obamma still can't get a handle on.
      Bottom line, this was a mess, but BP stepped up unlike Exxon who stood on the sidelines and hired legal dogs.
      I would suggest you cover your short position.

    • You are the one that is having a "pipe dream" with this negative spin/rant. You are 100% wrong.
      First, there is NO chance of gross negligence. The independent investigative report put the blame squarely on 4 different companies. Takes the gross negligence risk on BP off the table.

      These states will be lucky to get more than $20 billion. The Valdez was an easy case compared to this situation. It still took TWENTY years and the fine was reduced to a fraction to the original number. BP could EASILY play the same game. There will be a settlement, and it will be on BP's terms.

      • 1 Reply to jshmyhrn
      • My "Dream" is that this goes to $28 and I get back in and double my IRA in 3 or 4 years. This is low risk because the money is currently in several stocks that are not being sued and fined for tens of billions of dollars and facing tens of billions more in fines. If I was more confident of my predictions I would short BP and get a four bagger. But, I could be wrong, maybe the gulf states will decide to get what they can now rather than let it drag out to get more later. One judge will make the decision on the issue of "Gross negligence". He can decide whatever he wants, that is scary. He is a Clinton appointee, so, probably leans left. Lefties hate large corporations, especially oil. Why would BP be off the hook just because more than one company was guilty? Normally I am willing take a lot of risk hoping for big returns, but, BP is too risky for me now especially considering it has appreciated ZERO % in the last 7 years.

    • "There will not be a settlement, too many politicians involved."

      Politicians love and prefer a settlement. Lawsuit will/would take years and years, likelihood of same politicians being around then is slim. OTOH, they can push for a settlement now and hawk that accomplishment for reelection.

      "I know I canceled my vacation in Clearwater due to the spill. "

      Why and so what, BFD. Just because you chose to do something silly doesn't mean Fla has a claim. Spill was some 400 miles from Clearwater. Oil mostly went northe and west. Clearwater is south and east. There was never a threat to Clearwater. If your hotel, etc let you out of the VAC w/o penalty shame on them.

      "about Mexico; huge tourist industry ruined by the spill."

      Really????!!!!! Tell us how Cancun, Cozumel, etc were impacted by the spill. Heck if anything they benefitted from it. I am sure some who had planned to head for upper GC decided to go to Mex instead. Just because Mex or other entity files a claim doesn't mean such a claim has ANY merit.

      "then they can add punitive $ on top of that. "

      Nope. Doesn't work that way. "They" can't just add on anuything they want. Especially when talking punative damages. Have to follow specific laws and procedures. To date, nothing indicates punative or gross neglicence type punishment will be handed down. Plus, the state most significantly impacts (LA) get's lots of revenue from oil industry (probably including BP). They have an incentive to NOT too severely hurt BP or oil industry in general. Remeber LA gov has been out there pushing Obama to allow more new drilling in GOM. Can't really say oh woe is me due to BP and then turn around and beg for more of teh same.

      "Or, spin off a "BP America" division and file for bankruptcy. "

      Again, not how it works. Liability would flow right back up to BP International. Best they can maybe do is spin off some of the other BP assets and BK what would be left. Since BK's can travel straight up the corp structure (but they can't go across such sideways.) Plus even if the final total bill was $100B. It would take over a decade. It would barely double their current liabilities and they would have plenty of time to accrue for it. Would it hurt, sure. Would that ding the stock, you bet. But it would not BK BP. And it ain't gonna happen anyway.

      • 1 Reply to fore6996
      • Fore,

        I was right you were wrong. Florida now has a staff of lawyers (in Tampa, right near Clearwater) going after BP for lost tourism, they will get many billions. Individual small towns are settling for multimillions on lost tax revenue including FUTURE lost revenue. There are lots of small coastal towns, it will add-up to many billions. Mexico will eventually want to be paid for the ghost towns that Cancun and Cozemel became for over a year, face it, they lost many billions. This is endless and just getting started. BP PPS is going nowhere for a long long time. Company is run by a bunch of lying SOBs who are doling out many many billions and bleeding the company dry trying to keep their sorry azzez out of jail. Stock is over valued due to speculation and mistaken perception that it is undervalued. Sell and buy Exxon if you like oil. Admit you were wrong, take my advice, or regret it later.

        Your Hero, ilikeembrown.

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