“Potential Implications of a BP Bankruptcy Filing”
The world of BP p.l.c. has substantially changed since the April 20, 2010 explosion of the Deepwater Horizon drilling rig in the Gulf of Mexico. That event has resulted in deaths, personal injuries and the unleashing of tens of thousands of barrels of oil each day into the Gulf, thus earning the dubious distinction of the “worst environmental disaster America has ever faced.”
Significant claims for economic damage to the tourism and fishing industries in the states most adversely impacted by the gushing oil along the Gulf Coast, for personal injuries and deaths, and for environmental cleanup costs have begun being filed against BP or one or more of its subsidiaries, including BP Exploration and Production Company, Inc. – the lease operator of the Deepwater Horizon rig and a Delaware corporation. Analysts estimate that the total costs relating to the spill could be as high as $63 billion.
Although BP has so far publicly rebuffed any suggestions that it might file a bankruptcy case, speculation continues nonetheless on whether a future bankruptcy is likely and what impact a filing might have on myriad legal issues crossing environmental, tort and bankruptcy disciplines, among others. This Stroock Special Bulletin focuses solely on certain considerations implicated by a possible bankruptcy filing by one or more BP entities.