In a victory for investors, BP p.l.c. failed to convince a Texas federal judge to dismiss a class-action lawsuit seeking to recover billions of dollars in investment losses related to the company’s massive 2010 oil spill in the Gulf of Mexico.
Four Ohio pension funds, represented by Berman DeValerio, and the New York State Common Retirement Fund are co-lead plaintiffs in the case, which now moves to the discovery phase, during which time plaintiffs’ lawyers will gain access to critical documents and witnesses.
“This represents a major step towards a favorable resolution of plaintiffs’ claims,” said Glen DeValerio, a Berman DeValerio partner. “The case against BP is an extremely complex matter and the judge agrees that we have properly pleaded the facts and can pursue a recovery under U.S. securities laws.”
In his Feb. 13 ruling, the Hon. Keith P. Ellison of the Southern District of Texas allowed the Ohio and New York funds to continue pursuing claims that BP, two subsidiaries and certain officers and directors broke federal securities laws, misleading investors about BP’s operational and safety protocols, the scope of the Gulf oil spill, and the company’s ability to respond to a major oil spill.
According to the operative complaint, investors first began to learn the truth when an April 20, 2010 explosion on BP’s offshore drilling unit, the Deepwater Horizon, killed 11 workers and triggered the worst oil spill in petroleum industry history. As the full impact of the spill and the truth about BP’s operations became known, the company’s stock fell approximately 48%, eliminating more than $90 billion in market capitalization.
In a 129-page ruling, Judge Ellison denied defendants’ motion to dismiss securities fraud claims by American Depository Shares purchasers against parent company BP, subsidiaries BP America and BP Exploration & Production, former CEO Anthony Hayward and former COO for Exploration and Production Douglas Suttles.
Citing the U.S. Supreme Court’s ruling in Morrison v. National Australia Bank, the judge did dismiss claims made by purchasers of BP ordinary shares purchased on the London Stock Exchange. In a separate ruling issued the same day, Judge Ellison also dismissed claims by a different set of plaintiffs.
The case is In re BP p.l.c. Securities Litigation. The judge’s Memorandum and Order is available by clicking here.
*In August 2017, our firm name changed to Berman Tabacco. Case references and content published before that date may refer to the firm under our prior name, Berman DeValerio.