The fund was established to be used for natural resource damages, state and local response costs and individual compensation.
[1] It was established as Gulf Coast Claims Facility (GCCF), announced on 16 June 2010 after a meeting of BP executives with U.S. President Barack Obama.
Then CEO Tony Hayward stated, "We are taking full responsibility for the spill and we will clean it up and where people can present legitimate claims for damages we will honor them.
[5] On 16 June, after meeting with President Obama, BP executives agreed to create a $20 billion spill response fund.
For the fund's payments, BP said it would cut its capital spending budget, sell $10 billion in assets, and drop its dividend.
[9] BP pledged as collateral all royalties from the Thunder Horse, Atlantis, Mad Dog, Great White, Mars, Ursa, and Na Kika fields in the Gulf of Mexico.
[13] According to BP officials, the fund could be used for natural resource damages, state and local response costs and individual compensation but could not be used for fines or penalties.
Denied claims rose dramatically in October; some 20,000 people had been told they have no right to emergency compensation, compared to about 125 denials at the end of September.
[20] By early October, denied claims dropped from 528 to 116, as checks were cut and mailed to businesses that were initially told they would get no help.
[24] However, in early October, he had not yet divulged the information as promised and when asked, declined to say how much he was compensated, only that it is a flat fee "totally unrelated" to the size of the fund and amounts paid.
Charlie Crist and CFO Alex Sink, with a stern letter to Feinberg, saying the present pace of claims is "unacceptable" and directing his office to make whatever changes necessary to move things along.
Many of these individuals and businesses simply do not have the resources to get by while they await processing by the GCCF" associate U.S. Attorney General Thomas Perrelli wrote.
"Over the past few weeks, I have heard from the people of the Gulf, elected officials, and others that payments remain too slow and not generous enough," Feinberg said.
[31] In a letter sent 20 November by the Department of Justice (DOJ), Associate Attorney General Thomas Perrelli told Kenneth Feinberg that transparency is needed in the claims process so victims can see they're being treated fairly.
But after Gulf residents complained that the emergency payments were so small that they felt pushed into a hurried settlement to get more money, Feinberg made a concession.
Under the new rules (beginning 24 November and lasting until 23 August 2013), businesses and individuals may request compensation once a quarter while they decide whether to permanently settle their claim.
The law firm was paid $850,000 a month since June 2010, and payment of this fee will continue until the end of the year; afterwards, the contract will be reviewed.
[36] In July 2011, Mississippi's attorney general Jim Hood announced he is suing Feinberg to get access to claims filed by coastal residents, saying he's "seeking to make the process more transparent so people will know if Feinberg is looking out for the best interests of oil spill victims or BP".
[45] In April 2013, BP requested to halt claims payouts from the fund due to a number of fraudulent damages.
Barbier reasoned his decision saying that "BP has not produced any evidence that would warrant the court taking the drastic step of shutting down the entire claims program.