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BP claims czar Kenneth Feinberg drawing fire from Attorney General Bill McCollum

With the authority to dole out $20 billion to BP oil spill victims, Kenneth Feinberg has yet to provide exact details about who gets money and who doesn't.

But the few specifics Feinberg has mentioned are drawing fire from Florida's attorney general, Bill McCollum, a Republican running for governor.

McCollum said he was concerned that Feinberg was using an overly strict interpretation of Florida law that he could use to deny claims.

Feinberg, however, said he's not trying to restrict payouts.

"I am not adversarial to anyone in Florida," Feinberg said. "I want Floridians to get what is due them. I am working at their side to help them. And this money is going to be distributed for them."

Feinberg — who had administered compensation for victims of Sept. 11, 2001 — said he's streamlining the claims process so residents and businesses can submit claims by e-mail and the Internet rather than relying on fax machines and always-busy phone lines administered in BP's Gulf Coast claims center.

Feinberg, who is taking over the center's operations from BP, said he'll be an independent and fair administrator of people's claims. He will not administer state and local government claims from the $20 billion fund.

Feinberg said he's trying to "bend over backward to help eligible claimants in Florida and throughout the Gulf."

The key word: eligible.

Feinberg said he'll come up with "an expansive'' definition in the coming weeks. But when he appeared before the U.S. House Committee on Small Business last week, Feinberg said he would use "Florida law'' as one measure of eligibility.

When asked about whether Florida businesses could make a claim based on "the public misperception of tarballs on beaches," Feinberg testified that it was a "tough'' issue.

"Clearly, under Florida law, I think it's fair to say that it's not compensable. If there's no physical damage to the beaches and it's a public perception, I venture to say that it is not compensable," Feinberg said, noting "that's in this area where some discretion's going to have to be exercised."

Those are fighting words for McCollum.

McCollum said Tuesday that Feinberg was wrong on two counts. First, McCollum said, Feinberg shouldn't use Florida state law to decide how he'll pay claims under the federal Oil Pollution Act. Secondly, said McCollum, Feinberg misunderstood the strictness of state law.

For instance, McCollum said, a Key West hotel that's losing business because of the misperception of oily water and beaches could still get damages.

"I believe what Mr. Feinberg was saying was under Florida's law, you couldn't get any damages or recovery from that," McCollum said. "In fact, we believe he's quite wrong about that."

McCollum outlined his concerns in a letter. McCollum said he was "looking forward to meeting him and making sure we're all on the same sheet of music."

In a follow-up, McCollum's office noted that a recent Florida Supreme Court ruling, Curd v. Mosaic, could expand the right of many Florida businesses to sue in pollution cases. Echoing McCollum, his office said it was concerned that Feinberg was establishing ''arbitrary'' standards.

But two seasoned attorneys in oil spill cases — Carl Nelson, a Tampa attorney involved in a 1993 Tampa Bay case and Brian O'Neill, an attorney in the Exxon Valdez case — say Feinberg is more right than wrong because the Curd case specifically dealt with the rights of fishermen.

Like McCollum, Nelson said Feinberg shouldn't concern himself with Florida law in the first place. Nelson said he understood that Feinberg was in a tough position and would eventually have to fairly decide a formula determining who can get compensated.

"He will draw a line," Nelson said, "and those on the other side of the line are going to sue."

Business owner DeForest "Sandy'' Winslow is worried. As a developer and land owner in the Panama City Beach area, he cringed in hearing Feinberg's testimony.

"The statements that he made — and some of those he has made since — scare the hell out of me," Winslow said.

Winslow said he has submitted claims to the BP-run claims office, only to encounter busy signals, bad fax machines and impossible-to-reach claims adjusters.

When told of Winslow's problems, Feinberg said: "That's totally unacceptable." Once he takes over in the coming days, Feinberg said he'll automate the claims system to make sure people get their money as quickly as possible.

"I don't want people going to court." Feinberg said. "I want people coming to the fund. Why should a claimant spend five years in court and then lose under Florida state law and owe money to a lawyer rather than come into the Gulf Coast claims facility, which in part relies on Florida law and is even more lenient than Florida law?"

Marc Caputo can be reached at

BP claims czar Kenneth Feinberg drawing fire from Attorney General Bill McCollum 07/06/10 [Last modified: Tuesday, July 6, 2010 11:27pm]
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