OCEAN SPRINGS, Miss. – The law firm of Kenneth Feinberg, the man in charge of BP's $20 billion compensation fund for Gulf oil spill victims, has so far been paid about $3.35 million from BP PLC to dole out the money, the program said Thursday.
The BP payments go to a number of lawyers working on the claims process and are not necessarily exorbitant given the workload.
But Gulf coast residents who have been demanding transparency in the claims process have been eager to know how much Feinberg is earning, For some, the revelation of significant fees from BP are undermining Feinberg's claims that he is operating independently of the oil giant.
"There's no doubt in my mind that he's working for BP," said Louisiana shrimp processor Dean Blanchard. "He can say he's independent, but he's working for BP and he's low-balling all of us, the people affected the most."
BP PLC agreed to pay Kenneth Feinberg's firm, Feinberg Rozen LLP, $850,000 a month starting in mid-June, according to the Gulf Coast Claims Facility, which has been set up to compensate fishermen, business owners, residents and other Gulf Coast victims of the April 20 well blowout that killed 11 rig workers and spewed more than 170 million gallons of oil into the sea.
The claims facility on Thursday told The Associated Press the bill for the firm's services is now up to about $3.35 million, and Feinberg's firm will continue to receive $850,000 a month from BP through the end of the year, after which the contract will be reviewed.
Claims spokeswoman Amy Weiss declined comment on the payment details, referring AP to an Oct. 8 report from former U.S. Attorney General Michael Mukasey, whose own firm, Debevoise & Plimpton LLP, was hired by Feinberg's office to review the deal.
"The firm's work on the (Gulf Coast Claims Facility) is largely unprecedented," Mukasey wrote in his report. "The assignment is to allocate the largest claims fund in American history and to do so under both intense time pressure and public scrutiny."
Mukasey wrote that the fees being charged to BP by Feinberg's firm are warranted given the enormous task.
"The engagement commands a substantial commitment of the firm's personnel and resources," he wrote.
As of Nov. 3, the claims fund had paid victims about $1.7 billion, though many across the coast are still awaiting checks or say they have been paid too little and are struggling to keep up with bills after a summer of lost revenue.
The facility has received about 337,000 claims for compensation. About 97,000 have been paid or approved for payment. Another 97,000 claimants have filed requests for money but have provided no documentation to back up their losses, according to Feinberg.
The claims fund is denying many of those filings outright. To date, about 32,000 claimants have been denied.
Victims have until Nov. 23 to file for emergency payments to help keep them afloat. After that, they must submit a claim for a final settlement from BP. By doing that, they must give up their right to ever sue BP.
President Barack Obama tapped Feinberg, who previously oversaw money doled out to 9/11 victims, to run the BP claims fund, which the London-based company created under government pressure to ensure that it paid those hurt by the spill.
Feinberg is paid by BP, but he insists he is operating the fund independently and remains an advocate for Gulf Coast residents and isn't influenced at all by the oil giant in the process.
The claims facility said Thursday the firm's fees are being paid directly by BP and are not coming from the compensation fund. The program declined to say how much Feinberg is making personally, just that the fee is being paid to his firm.
Feinberg took over the claims process from BP in August.