Gulf Legal Claims Chief: No Sue Rule My Idea Not BP's (NYSE:BP)

Ken Feinberg, the new administrator handling legal claims from the victims of the Gulf said on Sunday that the no sue rule was his idea not BP's (NYSE:BP). Anyone receiving a settlement payout from the compensation fund, gives up their right to sue the company individually.

Feinberg was very clear that he would be far more generous in payments of funds than any court would be. "It is not in your interest to tie up you and the courts in years of uncertain protracted litigation when there is an alternative that has been created," said Feinberg. He continued, "I take the position, if I don't find you eligible no court will find you eligible."

Some of the guidelines have changed, like now the closer you are geographically to the oil spill location, the more likely you are to receive compensation. "I'm going to have to draw some tough lines," said Feinberg. He added that the most "problematic" claims will be from those in the tourism business.

BP (NYSE:BP): Escrow Solutions To Be Discussed at Meeting

Ken Feinberg, in charge of BP's (NYSE:BP) escrow fund has planned a public meeting in Pensacola, Florida to discuss escrow solutions. Many residents as well as business owners are planning on attending, with many questions on exactly how the fund will be handled. Even though it is open to the public a reservation is required.

One of the business owners planning on attending is Mike Pinzone. He says he's already lost over $250,000 from the lack of Summer business. BP has reimbursed him for only about 20 percent. If they don't get some sort of relief soon, around 60 to 70 percent of boardwalk businesses will have to shut down and won't be around next year.

"I just would like the opportunity to speak face to face with him. To get an appointment with him when he's ready, sit down, finish this thing. Stroke me a check and I'll be done. I don't want to beg for money every week, every month," said Pinzone.

This is Feinberg's second visit to Pensacola.

BP (NYSE:BP), Feinberg Want Immediate and Final Settlements

Ken Feinberg says the $20 billion BP (NYSE:BP) or Gulf Coast Escrow Fund, which he will be administering, has the goal of ending each case they deal with when it happens. "We're not interested in any halfway measures," said Feinberg.

How that'll work in the view of Feinberg will be to withhold distributing funds unless the claimant agrees to finalizing a deal. In other words, no back pay unless they make a deal for an estimate on future damages as well, right on the spot.

What that does is release BP from any future claims by the one filing it. This could be one of the reasons for the fund to be limited to a four-year period, as it would go on indefinitely if final agreements weren't found.

This is a risk on the side of BP and the claimants, as no one knows what the future holds, and it could be a better deal for one or another depending on the outcomes.

What will probably happen is some individuals and businesses will win in some cases, while BP will win in other instances; which should balance things out in the long run for BP.

Other options for claimants would be to use the Oil Pollution Act of 1990 (OPA) fund, which is considered more risky, and only deals with proven and past damages, which means claimants would have to come back over and over again if new damages emerge.

The other problem is its only funded with about $1 billion, which wouldn't be close to handling the amount of claims out there.

One other option would be to sue BP directly, which all of us know in cases like these, could take years to litigate.

Bottom line it seems in the matter, is Feinberg is setting it up for the escrow account of BP to be the fastest and safest way to take care of the damages.