Riley, King bicker over BP situation

Jessica M. Karmasek Sep. 17, 2010, 11:59am


MONTGOMERY, Ala. (Legal Newsline) - Alabama Attorney General Troy King says he knew Gov. Bob Riley would blame him for BP's rejection of the state's claim for tax losses resulting from the Gulf oil spill.

On Thursday, the oil giant decided -- in part due to pending litigation -- not to process the $148 million claim from the State for lost revenue.

"BP is not able to process the state of Alabama's interim lack of revenue claim for $148 million as presented," Justin Saia, a spokesman for the oil company, told the Montgomery Advertiser on Thursday. "BP is willing to continue to meet with the governor and/or other state representatives to discuss the claim and our position."

Due to pending litigation, Saia told the newspaper he could not elaborate on other reasons for the company deciding against paying the claim.

Riley, following the announcement, issued a statement. In it, the governor pointed fingers at King and his lawsuit, saying he "had no choice" but to increase proration for the education budget by 2 percent because of BP's rejection.

King said at a Friday morning press conference that's bunk. "He and I both know, however, that this lawsuit did not produce proration."

Proration is when the state budgets have to be cut across the board because the state is spending more money than it is taking in.

King contends Riley put the state in its position long before the oil rig exploded.

"Everyone was shocked when Governor Riley announced just eight months ago during his annual State of the State address that Alabama didn't need to cut spending, and would actually increase spending. This irresponsible budget is what caused proration in the first place," King said.

King described the governor's and the oil company's statements as "disappointing," but not surprising.

"Certainly, BP's promise to put the Gulf back the way they found it rings hollow to the tens of thousands of individuals and businesses who are still waiting for their claims to be paid. In fact, it is precisely because of BP's record of not living up to their commitments that I sued them.

"Ever since BP tricked the first fisherman in Bayou La Batre into signing the first waiver form to collect the first payment, I have been warning that BP could not be trusted. After all, BP is not a charitable foundation looking to make grants; it is a giant international corporation with an obligation to its stockholders to maximize its profits," the attorney general said.

King goes on to say that BP has "manipulated" Riley and as a result, the governor has "unwittingly" protected the company's interests.

"You have strung our Governor along for four months with promises that you would solve his financial crisis. All the while you never intended to willingly pay his claim," King said of BP.

Riley and other state officials submitted their claim directly to incoming BP CEO Bob Dudley on Aug. 12 during a meeting in Montgomery.

The same day that Riley met with Dudley, King filed two lawsuits against companies including BP for damages against the state.

King has said the oil giant has not acted in good faith, but that the lawsuit can be withdrawn if BP follows through on its promises to clean up the Gulf and make the state whole for damages and losses.

Meanwhile, Riley has expressed repeated concerns that the lawsuits could delay the state being compensated by BP because of lawyers becoming involved.

The attorney general said it is clear now that BP is "not dealing in good faith." He called on Riley to stop attempting to block his office from protecting residents.

"The lawsuit I have filed will require full accountability from BP. Unlike the Governor, I will not rush our claim and settle for whatever BP is willing to pay. Instead, I will prepare a properly documented claim and demand what Alabama is owed," King concluded.

From Legal Newsline: Reach Jessica Karmasek by e-mail at

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