ID 100153748 v. BP Exploration & Production, Inc.
708 F. App'x 812
| 5th Cir. | 2017Background
- Louisiana Tax Credit Finance, LLC (LTCF) bought and sold Louisiana film tax credits and filed a business-loss claim under the Deepwater Horizon Economic & Property Damages Settlement Agreement (the Settlement).
- LTCF listed NAICS code 454390 on its claim; the CSSP initially awarded LTCF ~$3.8M. BP appealed, arguing LTCF was an excluded “Financial Institution” under Section 2.2.4.1 and Exhibit 18.
- Appeal Panel reversed, finding LTCF effectively the same as Film Production Capital (an excluded financial entity) and that the reported NAICS code did not describe LTCF’s primary activity.
- After remand and reprocessing under Policy 495, the Claims Administrator assigned NAICS 522298 and denied the claim; LTCF’s re-review and Appeal Panel appeals were denied.
- LTCF sought discretionary review in district court; the district court declined review. LTCF appealed the denial of review to the Fifth Circuit. The Fifth Circuit AFFIRMED.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CSSP could consider activities of related but legally distinct entities when assigning NAICS code/exclusion | LTCF: CSSP improperly relied on other Film Production Capital entities; LTCF is a separate legal entity | BP: Settlement allows examining substantive business activity and may treat associated activities together for exclusion | Court: Settlement does not require ignoring legal distinctions; but Appeal Panel’s factual finding that LTCF had represented itself as DBA Film Production Capital justified treating it as the same for this claim; no abuse of discretion by district court in declining review |
| Whether CSSP selected wrong NAICS code for LTCF | LTCF: correct code is 454390 (direct selling) reflecting buying/selling tax credits | BP: appropriate code is within financial/ intermediation codes (e.g., 523910); tax credits are financial instruments, not merchandise | Court: 454390 poorly fits; 523910 (misc. intermediation) better describes buying/selling financial-like instruments; even if CSSP erred, correct code would still be an excluded financial code, so review would be futile |
| Whether disparate treatment (sister entities granted awards) required review | LTCF: four identical sister entities received awards under same listing, creating unfair disparate treatment; warrants district court review | BP: those awards were unappealed Claims Administrator decisions; few similarly situated claimants exist; permitting review would encourage prophylactic litigation | Court: No abuse of discretion—sister entities’ unappealed awards do not create a recurring panel split or substantial administrative impact; denying review does not unacceptably undermine fairness |
| Whether district court abused discretion in denying review of Appeal Panel decision | LTCF: district court should have reviewed because Settlement misapplied, incorrect NAICS, and disparate treatment | BP: district court has discretionary review; denial appropriate because issues were factual, case-specific, or would not change outcome | Held: No abuse of discretion; issues were factual/credibility determinations or would not alter exclusion result |
Key Cases Cited
- In re Oil Spill by Oil Rig "Deepwater Horizon", 910 F. Supp. 2d 891 (E.D. La. 2012) (district court opinion approving the Settlement Agreement)
- In re Deepwater Horizon, 739 F.3d 790 (5th Cir. 2014) (appellate decision affirming aspects of settlement administration)
- Claimant ID 100212278 v. BP Expl. & Prod., Inc., 848 F.3d 407 (5th Cir. 2017) (standard for when district court must review Appeal Panel decisions)
- Holmes Motors, Inc. v. BP Expl. & Prod., Inc., 829 F.3d 313 (5th Cir. 2016) (abuse-of-discretion standard and when denial of review is permissible)
- In re Deepwater Horizon, [citation="632 F. App'x 199"] (5th Cir. 2015) (denial of review improper where many panels split and issue recurring)