New York Pension Reevaluates BP Suit Yet Will Move Forward

(June 30, 2010) — Following a Supreme Court ruling that could curb investor claims against BP, New York state’s $132.6 billion Common Retirement Fund (CRF) is reevaluating its planned lawsuit against the oil giant for its management of the well in the massive Gulf of Mexico oil spill. However, the fund still plans to move forward with the BP lawsuit.

“We need to do additional analysis following the Supreme Court’s ruling, but now it’s just a question of how we’ll best proceed,” CRF spokesman Robert Whalen told ai5000. “We’re not rethinking – obviously we’re forced to reevaluate our legal strategy but our commitment to seeking remedy is unwavering.” He added that the New York pension will pursue its July 20 deadline to get a petition to be appointed as lead plaintiff for the BP suit and will go to foreign courts if necessary.

The New York pension alleges that BP had defrauded shareholders, misleading them over its safety record and preparedness to deal with oil leaks. CRM currently holds 14.1 million in BP overseas stock and 200,000 shares of BP shares sold in the US, Whalen confirmed.

Legal experts say the Supreme Court’s ruling, which may limit the expected number of investor claims against BP, is a loss for both non-US investors, who own the majority of BP, and American shareholders. The ruling has changed the playing field for New York’s pension, which bought many of BP’s securities directly from foreign markets rather than domestically.

Last week, data compiled by Bloomberg showed US state pensions suffered a  $1.4 billion loss from the BP oil disaster. The decrease in share price by BP has triggered mounting losses among institutional investors – along with pension losses, recent data has shown the governments of Norway, Kuwait, China and Singapore have lost $5 billion on BP Plc’s share price collapse.

BP has lost about half of its value since the April 20 explosion aboard a rig in the Gulf of Mexico that killed 11 workers and caused immeasurable destruction of the wildlife, beaches, and marshlands.