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BP oil spill lawsuit in U.S. wins class-action status

Published 21/05/2014, 13:55

(Reuters) - A U.S. judge has allowed a group of BP Plc shareholders to pursue a class-action lawsuit accusing the company of misleading them by understating the severity of the 2010 Gulf of Mexico oil spill.

U.S. District Judge Keith Ellison in Houston also denied class certification to a second group of shareholders that claimed BP had, prior to the explosion of the Deepwater Horizon drilling rig, overstated its ability to manage safety issues.

Ellison's decision on Tuesday could add to BP's clean-up and litigation costs for the spill. BP said this week it has already taken a $42.7 billion pre-tax charge.

It can be easier for investors to recover more money at lower cost by suing as a group.

The judge said investors who bought BP's American depository shares shortly after the April 20, 2010 spill may pursue claims as a group that BP publicly "lowballed" the oil flow rate soon after the rig explosion, and that the share price "did not reflect the magnitude of the disaster facing the company."

BP did not immediately respond on Wednesday to requests for comment. Steven Toll, a lawyer for the plaintiffs, did not immediately respond to similar requests.

The case is In re: BP Plc Securities Litigation, U.S. District Court, Southern District of Texas, No. 10-md-02185.

(Reporting by Jonathan Stempel in New York; Editing by Bernadette Baum)

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