BP Pleads Guilty to Charges Regarding the Deepwater Horizon Incident

Over a week ago Attorney General Eric Holder announced that BP has agreed to plead guilty to felony manslaughter, environmental crimes and obstruction of Congress and pay a record $4 billion in criminal fines and penalties for its conduct leading to the 2010 Deepwater Horizon disaster that killed 11 people and caused the largest environmental disaster in U.S. history. The 14-count information, filed in U.S. District Court in the Eastern District of Louisiana, charges BP with 11 counts of felony manslaughter, one count of felony obstruction of Congress, and violations of the Clean Water and Migratory Bird Treaty Acts.

BP has signed a guilty plea agreement with the government, admitting to its criminal conduct. As part of its guilty plea, BP has agreed, subject to the Court’s approval, to pay $4 billion in criminal fines and penalties – the largest criminal resolution in United States history.

According to Attorney General Holder. the resolution of charges against BP has been specifically structured to ensure that more than half of the proceeds directly benefit the Gulf Coast region so that residents can continue to recover and rebuild.

“The explosion of the rig was a disaster that resulted from BP’s culture of privileging profit over prudence,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “We hope that BP’s acknowledgment of its misconduct – through its agreement to plead guilty to 11 counts of felony manslaughter – brings some measure of justice to the family members of the people who died onboard the rig.”

In addition to the resolution of charges against BP and the highest-ranking BP supervisors onboard the Deepwater Horizon on April 20, 2010 they are alleged to have engaged in negligent and grossly negligent conduct in a 23-count indictment charging violations of the federal involuntary manslaughter and seaman’s manslaughter statutes and the Clean Water Act.

Furthermore, the BP executive who served as a Deputy Incident Commander and BP’s second-highest ranking representative at Unified Command during the spill response has been charged with obstruction of Congress and making false statements to law enforcement officials.

In agreeing to plead guilty, BP has admitted that the two highest-ranking BP supervisors onboard the Deepwater Horizon, known as BP’s “Well Site Leaders” or “company men,” negligently caused the deaths of 11 men and the resulting oil spill. The information details that, on the evening of April 20, the two supervisors, observed clear indications that the Macondo well was not secure and that oil and gas were flowing into the well. Despite this, BP’s well site leaders chose not to take obvious and appropriate steps to prevent the blowout. As a result of their conduct, control of the Macondo well was lost, resulting in catastrophe.

The supervisors of BP onboard Deepwater Horizon, if convicted, face a maximum potential penalty of 10 years in prison on each seaman’s manslaughter count, up to eight years in prison on each involuntary manslaughter count, and up to a year in prison on the Clean Water Act count.

The information charging BP further details that the company, through its senior executive officer, obstructed an inquiry by the U.S. Congress into the amount of oil being discharged into the Gulf while the spill was ongoing. As part of its plea agreement, BP has admitted that:

it withheld documents and provided false and misleading information in response to the U.S. House of Representatives’ request for flow-rate information.
it manipulated internal estimates to understate the amount of oil flowing from the well and
withheld data that contradicted BP’s public estimate of 5,000 barrels of oil per day.
at the same time its senior executive officer was preparing his manipulated estimates, BP’s internal engineering response teams were using sophisticated methods that generated significantly higher estimates. The Flow Rate Technical Group, consisting of government and independent scientists, later concluded that more than 60,000 barrels per day were leaking into the Gulf during the relevant time, contrary to BP’s representations to Congress.

BP’s senior executive officer, if convicted, faces a maximum potential penalty of five years in prison on each count.

The criminal resolution is structured such that more than half of the proceeds will directly benefit the Gulf region. Pursuant to an order presented to the Court, approximately $2.4 billion of the $4.0 billion criminal recovery is dedicated to acquiring, restoring, preserving and conserving – in consultation with appropriate state and other resource managers – the marine and coastal environments, ecosystems and bird and wildlife habitat in the Gulf of Mexico and bordering states harmed by the Deepwater Horizon oil spill. This portion of the criminal recovery will also be directed to significant barrier island restoration and/or river diversion off the coast of Louisiana to further benefit and improve coastal wetlands affected by the oil spill. An additional $350 million will be used to fund improved oil spill prevention and response efforts in the Gulf through research, development, education and training.

BP has also agreed on the following as part of its guilty plea:

retain a process safety and risk management monitor and an independent auditor, who will oversee BP’s process safety, risk management and drilling equipment maintenance with respect to deepwater drilling in the Gulf of Mexico.
retain an ethics monitor to improve BP’s code of conduct for the purpose of seeking to ensure BP’s future candor with the United States government.

The United States continues to pursue a civil action to recover civil penalties under the Clean Water Act and hold BP and other defendants liable for natural resource damages under the Oil Pollution Act. A trial on liability matters is scheduled to begin in February 2013, during which the United States will seek to establish that the spill was caused by BP’s gross negligence. BP could face billions of dollars of additional exposure in the civil lawsuit.

The Deepwater Horizon Task Force, based in New Orleans, is supervised by Assistant Attorney General Breuer and led by Deputy Assistant Attorney General John D. Buretta, who serves as the director of the task force. The task force includes prosecutors from the Criminal Division and Environment and Natural Resources Division of the Department of Justice; the U.S. Attorney’s Office for the Eastern District of Louisiana, as well as other U.S. Attorneys’ Offices; and investigating agents from the FBI, Environmental Protection Agency, Department of Interior, National Oceanic and Atmospheric Administration Office of Law Enforcement, U.S. Coast Guard, U.S. Fish and Wildlife Service and the Louisiana Department of Environmental Quality.

USDOJ has also released the following documentation, relevant to the Deepwater Horizon case:

Source: USDOJ