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In re Deepwater Horizon

United States Court of Appeals, Fifth Circuit

May 8, 2015

IN RE: DEEPWATER HORIZON; LAKE EUGENIE LAND DEVELOPMENT, INCORPORATED; BON SECOUR FISHERIES, INCORPORATED; FORT MORGAN REALTY, INCORPORATED; LFBP 1, L.L.C., doing business as GW Fins; PANAMA CITY BEACH DOLPHIN TOURS & MORE, L.L.C.; ZEKES CHARTER FLEET, L.L.C.; WILLIAM SELLERS; KATHLEEN IRWIN; RONALD LUNDY; CORLISS GALLO; JOHN TESVICH; MICHAEL GUIDRY, on behalf of themselves and all others similarly situated; HENRY HUTTO; BRAD FRILOUX; JERRY J. KEE, Plaintiffs - Appellees
v.
BP EXPLORATION & PRODUCTION, INCORPORATED; BP AMERICA PRODUCTION COMPANY; BP, P.L.C., Defendants - Appellants

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[Copyrighted Material Omitted]

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Appeal from the United States District Court for the Eastern District of Louisiana.

For Lake Eugenie Land & Development, Incorporated, Bon Secour Fisheries, Incorporated, Fort Morgan Realty, Incorporated, Lfbp 1, L.L.C., doing business as: GW Fins, Panama City Beach Dolphin Tours & More, L.L.C., Zekes Charter Fleet, L.L.C., William Sellers, Kathleen Irwin, Ronald Lundy, Corliss Gallo, John Tesvich, Plaintiffs - Appellees: Stephen Jay Herman, Esq., Soren E. Gisleson, Esq., Herman Herman & Katz, L.L.C., New Orleans, LA; James Parkerson Roy, Domengeaux, Wright, Roy & Edwards, Lafayette, LA; Elizabeth Joan Cabraser, Lieff, Cabraser, Heimann & Bernstein, L.L.P., San Francisco, CA; Samuel Issacharoff, New York University, School of Law, New York, NY.

For John Tesvich, MICHAEL GUIDRY, on behalf of themselves and all others similarly situated, Henry Hutto, Jerry J. Kee, Plaintiff - Appellee: Stephen Jay Herman, Esq., Herman Herman & Katz, L.L.C., New Orleans, LA; James Parkerson Roy, Domengeaux, Wright, Roy & Edwards, Lafayette, LA; Elizabeth Joan Cabraser, Lieff, Cabraser, Heimann & Bernstein, L.L.P., San Francisco, CA; Soren E. Gisleson, Esq., Herman Herman & Katz, L.L.C., New Orleans, LA; Samuel Issacharoff, New York University, School of Law, New York, NY.

For Bp Exploration & Production, Incorporated, Bp America Production Company, Bp, P.L.C., Defendant - Appellants: Theodore B. Olson, Miguel Angel Estrada, Thomas George Hungar, Scott Payne Martin, Gibson, Dunn & Crutcher, L.L.P., Washington, DC; George Howard Brown, Esq., Gibson, Dunn & Crutcher, L.L.P., Palo Alto, CA; Jeffrey Bossert Clark Sr., Esq., Kirkland & Ellis, L.L.P., Washington, DC; Richard Cartier Godfrey, Esq., James Andrew Langan, Esq., Kirkland & Ellis, L.L.P., Chicago, IL; Don Keller Haycraft, Liskow & Lewis, P.L.C., New Orleans, LA.

Before BENAVIDES, PRADO, and GRAVES, Circuit Judges.

OPINION

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FORTUNATO P. BENAVIDES, Circuit Judge:

This action involves the Economic and Property Damages Settlement Agreement (" Settlement Agreement" ) approved by the district court on December 21, 2012, between Appellants BP Exploration & Production, Inc., BP America Production Company, and BP p.l.c. (collectively, " BP" ), and Appellees, the certified Economic and Property Damages Class, in connection with the Deepwater Horizon oil spill of April 20, 2010. The Court Supervised Settlement Program (" Settlement Program" or " CSSP" ) was set up to compensate parties with economic losses caused by the oil spill. This specific dispute arises from the district court's order of May 20, 2013 (" May 20 Order" ), approving the Final Rules Governing Discretionary Court Review of Appeal Determinations (" Final Rules" ) for claims processed through the Settlement Program, which has been challenged by BP.

I. INTRODUCTION

Under the Settlement Agreement, class members may submit claims to the Settlement Program, overseen and managed by a Claims Administrator whose decisions may be reviewed upon request by an Appeal Panel. The Appeal Panel reviews, inter alia, briefs from the parties, the Settlement Agreement, relevant district court rulings, the claim file, the parties' submissions, and the Claims Administrator's decision. See Appeal Panel Rule 13 (Feb. 4, 2013) (" Appeal Panel Rules" ), available at http://www.deepwaterhorizoneconomicsettlement.com/docs/Rules_Governing_the_Appeals_Process_-_Final.pdf. The materials presented to the Claims Administrator and Appeal Panel are not posted to the district court's civil docket but rather to a non-public Settlement Program website known as the DWH Portal. See, e.g., Appeal Panel Rules 10(b), 11(b), 15, 17, 18, 23. Redacted versions of Appeal Panel decisions are made available to the public through the Settlement Program website. Appeal Panel Rule 24. Appeals in which the compensation amount is at issue go through a baseball arbitration process,[1] and the Appeal Panel decision is considered " final." Agreement § 6.2.

The Settlement Agreement confers " continuing and exclusive jurisdiction over the Parties and their Counsel for the purpose of enforcing, implementing and interpreting" the Agreement on " the Court." Agreement § 18.1. The Agreement defines " Court" as " the United States District Court for the Eastern District of Louisiana, Judge Carl Barbier, presiding." Agreement § 38.40. The Settlement Agreement provides that " [t]he Court maintains the discretionary right to review any Appeal determination to consider whether the determination was in compliance with the Agreement. Upon reviewing such a determination, the Court shall treat the Appeal determination as if it

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were a recommendation by a Magistrate Judge." Agreement § 6.6.

Section 6 of the Settlement Agreement governs the claims appeal process. It leaves room for the Settlement Program to " establish additional procedures for the Appeal Process not inconsistent with Exhibit 25." Agreement § 6.3. Exhibit 25, in turn, sets out procedures for filing and briefing appeals. Exhibit 25 allows the Appeals Coordinator, with the concurrence of the Claims Administrator, to " amend and/or adopt procedures as necessary to implement Section 6 of the Agreement after providing notice and a right to comment by the BP Parties and Lead Class Counsel." Agreement, Exhibit 25.

On April 29, 2013, the Claims Administrator released Draft Rules governing the district court's review of Appeal Panel decisions, and BP responded with comments objecting to the Draft Rules' limits on appellate review by the Court of Appeals and the lack of provisions requiring documents and orders to be filed on the civil docket--similar arguments to the ones made in this appeal. Class Counsel also submitted comments.

The Final Rules that were adopted by the district court through its May 20 Order are at issue before us. BP challenges the Final Rules for not providing for the docketing of requests for district court review or district court orders regarding such requests, which, it argues, compromises a right to appeal from the district court to this court and violates Federal Rule of Civil Procedure (" FRCP" ) 79's provisions regarding the clerk's maintenance of the civil docket. Final Rule 12 states, " The Settlement Agreement provides no right of automatic appeal to the Court. Whether the determination of an Appeal Panel will be reviewed by the Court lies solely within the Court's discretion. Review of an Appeal Panel determination will be granted only in exceptional circumstances." Several provisions of the Final Rules implicate the question of whether there is a right to appeal claim determinations from the district court to this court under the Settlement Agreement. The Final Rules provide that requests for judicial review and related documents be posted to the DWH Portal rather than on the civil docket, and that the Appeals Coordinator be responsible for sending materials to and from the district court. See Final Rules 7, 8, 19, 21-22. BP also challenges the Final Rules for preventing it from seeking judicial review of certain categories of awards. Final Rule 16, which was not in the Draft Rules, provides that for certain cases,[2] " no Request or Objection may be submitted and the processing of claims will not be suspended in such cases unless there is a further order of the Court." Under Final Rule 19, the Appeals Coordinator is not to submit any requests or objections for these cases to the district court. District court decisions are posted to the DWH Portal and in redacted form on the Settlement Program's website. Final Rule 27.

To challenge the Final Rules, on June 17, 2013, BP filed a motion under FRCP 59(e) to amend the May 20 Order and the Final Rules. BP requested the court to amend the Rules to clarify (1) " that all requests for discretionary review, objections thereto, and Court orders regarding such requests will be entered into the appropriate Court docket" ; (2)

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[3]

On September 4, 2013, the Appeals Coordinator notified BP that the district court had denied BP's requests for review of three awards to non-profit organizations. In accordance with Final Rules 16 and 19, the district court did not docket the requests for review, the underlying record, or the orders denying review. These denials are the subject of the appeals in Nos. 13-31296, 13-31299, and 13-31302 (" Non-Profit Appeals" ). Class Counsel and the Non-Profit Appeals claimants moved to dismiss those appeals. Because jurisdiction over the Non-Profit Appeals hinges on our decision with respect to the Final Rules and the availability of further review by this court of individual claim determinations that have been reviewed or denied review by the district court, we consolidated the three Non-Profit Appeals and directed all four cases to be heard and decided by the same panel. In this specific appeal, we address (1) whether we have jurisdiction over the appeal of the May 20 Order that approved the Final Rules, (2) whether there is a right to appeal claim determinations from the district court to this court under the Settlement Agreement, (3) whether the Final Rules violate any right to appeal under the Settlement Agreement, and (4) whether the district court erred in categorically precluding certain categories of cases from its review through the Final Rules.

II. JURISDICTION OVER THIS APPEAL

As an initial matter, we must determine whether BP's notice of appeal was timely and whether we have jurisdiction over this appeal.

Under FRCP 59(e), a party may request " to alter or amend a judgment." Fed.R.Civ.P. 59(e). " Such motions serve the narrow purpose of allowing a party to correct manifest errors of law or fact or to present newly discovered evidence." Waltman v. Int'l Paper Co., 875 F.2d 468, 473 (5th Cir. 1989) (internal quotations omitted). Class Counsel argue that BP's appeal was untimely because it did not file its notice of appeal 30 days after the May 20 Order as required by FRAP 4(a)(1)(A), and because it did not make a proper FRCP 59(e) motion to fall under the exception of FRAP 4(a)(4)(A)(iv). They argue that BP's motion was not properly brought under FRCP 59(e) because it " focused on amending the [Final] Rules themselves, not the district court's order approving them," and because it raised arguments that had already been brought before the Appeals Coordinator.

We find that these arguments lack merit. While it is true that BP sought to amend the Final Rules, the district

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court had incorporated and attached the Final Rules as part of its decision to adopt them in its May 20 Order. Thus, it was proper under FRCP 59(e) for BP to request the court to alter or amend the Final Rules, which BP believed offended its rights and violated the Settlement Agreement. While an FRCP 59(e) motion " is not the proper vehicle for rehashing evidence, legal theories, or arguments that could have been offered or raised before the entry of judgment," Templet v. HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004), and BP's motion did bring forth some of the arguments that had been presented to the Appeals Coordinator,[4] the motion was the first opportunity to present arguments regarding the Rules directly to the district court. It was also the first opportunity to address the alleged manifest error of law in Final Rule 16, which was not in the Draft Rules, and the new provision in Final Rule 19, which together preclude certain cases from any further review by the district court. Thus, we conclude that BP's motion to amend was proper.

As noted above, the district court adopted the Final Rules on May 20, 2013, and BP filed its motion to amend on June 17, 2013, which was timely. See Fed.R.Civ.P. 59(e) ( " A motion to alter or amend a judgment must be filed no later than 28 days after the entry of the judgment." ). Under FRAP 4(a)(4)(A)(iv), the time to file a notice of appeal--within thirty days under FRAP 4(a)(1)(A)--started to run on July 16, 2013, when the district court issued its order denying the FRCP 59(e) motion. Thus, BP's notice of appeal filed on August 2, 2013, was timely.

Having found that the appeal was timely, we next turn to whether we have jurisdiction over the appeal. BP invokes jurisdiction under the collateral order doctrine and 28 U.S.C. § 1292(a)(3). We find that jurisdiction is proper under the collateral order doctrine. To fall under the collateral order doctrine, " an 'order must (1) conclusively determine the disputed question, (2) resolve an important issue completely separate from the merits of the action, and (3) be effectively unreviewable on appeal from a final judgment.'" Henry v. Lake Charles Am. Press, L.L.C., 566 F.3d ...


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