BP investors lose bid for class status in Gulf spill case

Reuters

By Nate Raymond

Dec 7 (Reuters) - A U.S. federal judge has refused to allowinvestors to proceed as a group in a lawsuit accusing BP Plc of fraud by misleading them - before and after the 2010Gulf of Mexico oil spill - about the company's ability torespond to an accident.

U.S. District Judge Keith Ellison in Houston denied arequest on Friday to certify a class action of holders of BP'sAmerican depository shares (ADSs) who were allegedly injured bythe energy giant.

"Plaintiffs have failed to discharge their burden toestablish that damages in this case can be measured on aclass-wide basis consistent with their theories of liability,"Ellison wrote.

The judge said his decision was based largely on a U.S.Supreme Court ruling from March holding that a class actionagainst Comcast Corp was improperly certified.

Ellison said the Supreme Court decision "has appreciablychanged the landscape for class certification."

But he said he would allow the plaintiffs another chance toargue that their case should move forward as a class action,giving them 30 days to file a new motion.

Geoff Morrell, a spokesman for BP, said the ruling "confirmsBP's view, as noted in our brief and at oral argument, thatplaintiffs failed to establish that this case is appropriate forclass treatment."

Steven Toll, a lawyer for the plaintiffs at Cohen MilsteinSellers & Toll, said the investors "definitely do intend torefile the motion to address the court's concerns about theComcast ruling."

Friday's decision follows a February 2012 ruling dismissingclaims by purchasers of ordinary BP shares on the basis of anearlier 2010 Supreme Court ruling limiting the ability ofholders of foreign securities to bring cases in U.S. courts.

The plaintiffs are led by the New York State CommonRetirement Fund and four Ohio public pension funds.

They sued BP after the April 20, 2010, explosion of theDeepwater Horizon drilling rig, which killed 11 people andresulted in the largest offshore oil spill in U.S. history. Theinvestors said BP's shares dropped in value around 40 percent inthe weeks after the incident.

The plaintiffs had asked Ellison to certify a class ofinvestors who bought ADSs between November 8, 2007, and May 28,2010. They also asked for subclass to be certified coveringpurchasers of ADSs from March 4, 2009, to April 20, 2010.

BP continues to face other litigation stemming from theDeepwater Horizon incident, which has resulted in the companytaking $42.5 billion in charges to date.

In January, BP pleaded guilty to 14 criminal counts overconduct leading up to and after the disaster as part of a $4billion settlement with the U.S. Justice Department.

The case is In re: BP Plc Securities Litigation, U.S.District Court, Southern District of Texas, No. 10-md-02185.

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