Coon's law firm will take on BP over Deepwater Horizon
Brent Coon is on the warpath over the Deepwater Horizon disaster. The Texan lawyer is resuming hostilities with an old foe, BP
HE RIDES a Harley, plays guitar in a rock band and goes skydiving. But Brent Coon's name is known for something else: suing BP. And that's ok with him. With Coon leading many of the lawsuits against BP following the Texas City refinery disaster of 2005, which killed 15 workers and injured more than 100, the settlements ran to more than $3bn.
Deepwater Horizon promises a much larger pot for the plaintiffs. The explosion aboard the rig last April killed 11 men and caused the biggest oil spill in US history. Coon's firm, Brent Coon Associates, is representing thousands of claimants, with a docket going well into the hundreds of millions of dollars.
He wasn't surprised by the accident. Whatever Tony Hayward and other BP executives say, Coon doesn't think the company's spots had changed since the earlier accident at Texas City, when it was proved to have disregarded the safety of its refinery workers. It's just not in the nature of big industrial corporations to take those risks seriously, he says, summing up the approach as: "All that'll happen is a bunch of people will die and we'll have to pay a fine."
Criminal charges, not just financial penalties, ought to be thrown at companies that behave this way, he argues. In the wake of Texas City, his firm pushed the US Department of Justice (DOJ) and other agencies to go after BP and its executives, saying that "in the absence of individual criminal indictment, the risk of those people continuing along the same lines just increases". Without indictment before a Grand Jury, he argued then, BP would learn nothing from Texas City.
Indeed, his version of events before Deepwater Horizon offers a story of scant compliance with rules by BP and weak federal oversight. BP, says Coon, failed to live up to the terms of its probation over Texas City, which involved fixing the deficiencies at the refinery by September 2009. "By the deadline, the external committee found hundreds of deviations. It was so bad it would have taken four years just to get into compliance," says Coon. BP paid a fine of $80m.
So Coon pressed the DOJ to reopen the case against BP. The DOJ refused. Over a number of months, Coon says, he sent several letters restating his case, but received no response. "A month later Deepwater Horizon blew up. The first thing I did was call the lead prosecutor in the case and say: 'I told you so.' I had warned him."
All of this is sure to get another airing in the courts in the coming months and years, with proceedings against BP, Transocean, Halliburton and others involved in Deepwater Horizon sure to drag on. Brent Coon's name will be in lights again.
He cuts a dash in and out of the courtroom. As well as running his busy multi-office legal practice, his business interests include concert and entertainment management, golf courses and other property development.
Playing guitar for hard-rock band Image 6 also keeps him busy. His musical influences are Aerosmith, ZZ Top and Led Zeppelin. His MySpace page lists his most recent favourite quotation as: "Life should not be a journey to the grave with the intention of arriving safely in an attractive and well preserved body, but rather to skid in sideways, chocolate in one hand, martini in the other, body thoroughly used up, totally worn out and screaming: 'WOO HOO, what a ride!'"
It's a daunting motto for the lawyers from BP who will face him in US courts. And, believes Coon, they've got another think coming. While BP reckons its liabilities to be around $40bn, Coon says they could exceed $100bn.
BP has already been making voluntary, quarterly contributions of $1.25bn into a fund to pay short-term claims. But the figure is arbitrary, says Coon, and has not been enough to pay all of the claims. Nor has the duration of the damages been taken into consideration. Businesses have so far claimed just short-term losses, he says, but these will multiply with time.
About 460,000 hardship claims have been made, says Coon. But the number could rise to around a million. Of those 460,000, he says, only a quarter were paid before the fund ran out. "So that's $2.5bn right there, and they've arbitrarily denied three out of four claims." And of those that were paid, says Coon, claimants received "on average 20-25% of their claim".
Coon warms to his subject. "Let's do the math. Somewhere between 25% and 100% is the fair payment. Say it's only 50%. That already doubles what BP pays. That's $5bn. Then add in just one of the three out of four claims that were ignored, which were largely the bigger ones. That doubles it. You're talking at least $10bn. And remember that I expect another half a million claims. On top of that, the longer this goes on, the bigger the claims will become, because the damage to these businesses only deepens with time."
A $100bn bill
According to Coon's model, even if half of the claims are ignored, over two or three years the total could reach $50bn. And that excludes health claims and criminal penalties attached to the estimated 4.9m barrels of oil spilled into the Gulf. Taking these into consideration, Coon's $100bn estimate is possible.
If he's right, BP's efforts to move beyond the disaster – it has sacked former boss Tony Hayward and other executives, sold several assets to raise cash, published its own study of the accident and, last month, announced a new deal with Russia's Rosneft – look tricky. Trailed by lawyers in a notoriously litigious country, BP's court battles in the US could consume the UK major for the next decade, predict some analysts.
Coon is famous for saying that he won't be happy until some of those personally responsible for Deepwater Horizon are put in jail. "I stand by that," he says. "I did at the time of Texas City and I do now." It's the only way, he says, to stop bad corporate behaviour putting more lives and the environment at risk.
"I blame the DOJ, the Texas Attorney General's office and the District Attorney's office for not being more aggressive in holding individuals accountable for what happened at Texas City. This should have been used as an example, as a clear deterrent." Last month, a commission appointed by President Barack Obama to investigate the accident opened the net of accusations even wider, citing poor federal oversight and inadequate regulation among the root causes of the disaster, too.
It's enough to keep Coon and his firm busy in the coming years. But Coon says he'd rather be put out of business. "After all, what I do for a living is hold corporations accountable for hurting and killing people."
BP declined to comment on the statements made and opinions expressed by Coon.