Ex-BP Executive Acquitted of Lying About Size of 2010 Gulf Oil Spill

The 2010 Gulf oil spill as seen from NASA’s Terra Satellite on May 24, 2010. Photo: Creative Commons

By Katy Reckdahl and Margaret Cronin Fisk

(Bloomberg) — The highest-ranking BP Plc executive charged in the 2010 Gulf of Mexico oil spill was found not guilty of lying to investigators in a blow to prosecutors as the company awaits word on billions of dollars in potential fines for the disaster.

Other BP employees still face prosecution. Two former well- site managers charged with manslaughter are scheduled for trial starting in February. An engineer accused of destroying evidence had his conviction reversed, with a judge ordering a new trial for him.

The New Orleans jury on Friday sided with David Rainey, BP’s former vice president of Gulf of Mexico exploration, whose lawyer called the case one of “prosecutors’ overreach.”

U.S. District Judge Kurt D. Engelhardt said he thought the jury had reached “the correct verdict, based on the evidence.”

Rainey is “grateful and relieved and really wants to put this chapter behind him,” Reid Weingarten, his attorney, told reporters outside the court. There was “not a scintilla” of credible evidence pointing to wrongdoing by his client, Weingarten said.

Rainey himself declined to comment on the verdict.

“We respect the jury’s verdict,” Leo Tsao, a Justice Department lawyer, told reporters without commenting further.

Flow Rates

Rainey wasn’t involved in the drilling of the BP well and wasn’t accused of any wrongdoing related to the blast. The U.S. claimed Rainey cherry-picked information from flow-rate reports to make the oil spill seem less catastrophic than it was.

“Today’s verdict demonstrates how difficult it is to prosecute individuals when the primary culprit is a corporate culture run amok,” said David Uhlmann, a former head of the Justice Department’s environmental crimes section and now a University of Michigan Law School professor.

“In its case against David Rainey, the Justice Department also faced a significant evidentiary hurdle, which is that no one knows how much oil gushed into the Gulf of Mexico,” Uhlmann said in an e-mail.

The jury was already deciding a narrower case than the government initially proposed.

Engelhardt threw out an obstruction of Congress charge on Monday, the first day of the trial. On Wednesday, the judge blasted the government for basing its prosecution on a federal investigator’s notes instead of a recorded interview of Rainey.

Relying on such evidence is “very dangerous territory,” the judge said outside the presence of the jury. The judge already had been considering whether to throw out the case against Rainey regardless of the jury’s verdict.

Evidence Trash

Weingarten took up the judge’s concerns in his closing argument to the jury Friday, urging it to reject the investigator’s notes because, he said, the evidence was “a piece of trash.”

The BP well blowout off the Louisiana coast in April 2010 killed 11 people aboard the drilling rig and set off the largest offshore oil spill in U.S. history.

The London-based company earlier pleaded guilty for its part in underestimating the spill’s size. BP also paid $525 million to the U.S. Securities and Exchange Commission, which alleged it downplayed the size to bolster stock prices.

BP agreed in 2012 to plead guilty to 11 counts of manslaughter for the deaths and two misdemeanor pollution law violations, paying a $4 billion settlement to the U.S.

Pollution Violation

The company is awaiting a separate court ruling on how much it will have to pay for violating the U.S. Clean Water Act. The government asked U.S. District Judge Carl Barbier to fine BP at least $12 billion.

BP has argued that any fine should be much lower, and that Barbier should consider its efforts to stop the spill. Barbier found in September that BP was grossly negligent in causing the blowout, raising the maximum possible fine.

BP has put aside $43.8 billion to pay for the disaster. The company has already paid more than $28 billion in response, cleanup and compensation, BP said in a regulatory filing in April.

Rainey wasn’t trying to mislead anyone and was scurrying to provide estimates of the flow rate of a spill that was beyond anyone’s prior experience, Weingarten told the judge Wednesday.

“Put this miserable case away,” he urged Engelhardt. “This man has suffered for five years and it’s enough.”

Two BP well-site managers, Robert Kaluza and Donald Vidrine, were charged in November 2012 with involuntary manslaughter for the 11 deaths and face trial in February.

The case is U.S. v. Rainey, 12-cr-00291, U.S. District Court, Eastern District of Louisiana (New Orleans).

–With assistance from Della Hasselle in New Orleans.

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