Now well over a year since the Deepwater Horizon explosion, Mississippi Attorney General Jim Hood has filed suit against Ken Feinberg, often referred to as the “oil spill pay czar,” on the basis that he is in violation of the Mississippi Consumer Protection Act. Does the lawsuit have merit? Why was it filed? We examine these questions in an interview with both Hood and Feinberg.

First, some background on the suit that was filed. AG Hood filed a lawsuit against Ken Feinberg, whose official title is administrator of the BP Deepwater Horizon Disaster Victim Compensation Fund. In it, Hood states that the handling of the oil spill claims is in violation of the Mississippi Consumer Protection Act.

Hood states that Feinberg has repeatedly refused to turn over documents that could be examined and used to prove if the Gulf Coast Claims Facility is operating properly within the law. Hood alleges that Feinberg has failed to produce the documents that he subpoenaed in February.

Feinberg, however, says that he feels he “has been bending over backwards to help the Attorney General of Mississippi, and his staff feels the same.” He advised that he and his office have turned over the 120 claims files requested by Hood and that the claimants had authorized the information to be released. Feinberg’s office reports that they “have not heard a word” since that release of files.

Feinberg also said that he invited Hood to his Washington office over Memorial Day weekend to review claims files and see the entire process that is being used to handle the claims. Hood did not attend the meeting, but sent some of his staff to attend. Thirteen files were examined and the processes reviewed. Feinberg reports that he received no feedback regarding the meeting, and he felt that the Attorney General’s office was satisfied.

When asked, Hood advised that he filed suit based on the complaints that his office had received in the consumer protection division. He says Feinberg has not been forthcoming in turning over the requested documents, despite repeated requests from his office. He said he filed suit due to Feinberg’s failure to fully comply with the information requests.

Hood states that there are two separate actions at play: the requested files that claimants have authorized to be turned over to the Attorney General to investigate and review, and the possible violation of the Mississippi Consumer Protection Act.

The lawsuit was filed in Hinds County Chancery Court in Jackson, Miss., and is scheduled to be heard on Sept. 7 by Judge Denise Street Owens. Hood says he expects Feinberg will try to move the lawsuit to federal court, but said he is adamant in pursuing what he believes to be an investigation to make certain that the people of Mississippi are being treated fairly and that claims are being handled properly.

If the lawsuit is moved to federal court, it could cause a delay in the outcome and spark a long and drawn-out litigious process. It is an election year for Hood, and when asked what would happen to the lawsuit if he was not re-elected, he advised that he fully intends to finish his third term and to see the oil spill litigation to closure.

Steve Simpson is Hood’s opponent in the upcoming election in Mississippi in November. Also a former circuit court judge, we asked his legal opinion regarding the suit filed by Hood. Simpson stated that he was concerned regarding the Attorney General’s motives for the litigation.

Simpson said that after Katrina, Hood “made numerous and very serious allegations against the insurance industry regarding their claims processes. He convened a grand jury and subpoenaed thousands of pages of documents over many months, then abruptly dropped his investigation, which coincided with the global settlement of most of the civil litigation.”

Simpson said that if he is elected in November he “will very closely monitor the administration of claims and protect Mississippi’s rights.” He also questions Hood’s motivations.

“A year and a half after the spill, the timing of this lawsuit by the incumbent within a few months of his re-election bid speaks for itself,” says Simpson. “As a coast native, I'll make sure claimants are made whole and the long-term effects on our marine environment are protected.”

When asked about the case being moved to federal court, Simpson says; “It would not surprise me to see an effort to move the case to federal court given the character of parties and the nature of the legal claims. I don’t foresee this as having an adverse impact on Mississippians. Although the litigation will likely slow the overall claims process, the federal court may be able to move the case faster than our congested state court.”

Simpson says if he becomes the Attorney General he would “ensure that the AG’s office would be willing and able to work with the Governor, the Lt. Governor, and state agencies in a coordinated effort to best serve the victims and the state. In the past, recovery efforts have been frustrated by the unwillingness to work together.”

Whatever the outcome of the lawsuit, it is of vital importance to the industry’s success and survival that we learn from the catastrophic events that present us with the challenge of handling enormous numbers of claims and insurmountable litigation. We must always look to make the claims handling and litigation process better, more transparent, more expeditious, and fair.

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Motivations Behind the Hood/Feinberg Lawsuit

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