I’ve mediated before Kenneth Feinberg, and he’s a big-shot, very expensive guy who happens to be exceptionally good at what he does. That’s why I was a bit puzzled by this Herald story on how he intends to interpret claims by Floridians under the new $20 billion compensation fund:
Feinberg said he’ll come up with “an expansive” definition in the coming weeks. But when he appeared before the U.S. House Committee on Small Business last week, Feinberg said he would use “Florida law” as one measure of eligibility.
When asked about whether Florida businesses could make a claim based on the “the public misperception of tar balls on beaches,” Feinberg testified that it was a “tough” issue.
“Clearly, under Florida law, I think it’s fair to say that it’s not compensable. If there’s no physical damage to the beaches and it’s a public perception, I venture to say that it is not compensable,” Feinberg said, noting “that’s in this area where some discretion’s going to have to be exercised.”
Those are fighting words for McCollum.
McCollum said Tuesday that Feinberg was wrong on two counts. First, McCollum said, Feinberg shouldn’t use Florida state law to decide how he’ll pay claims under the federal Oil Pollution Act. Second, McCollum said, Feinberg misunderstood the strictness of state law.
For instance, McCollum said, a Key West hotel that is losing business because of the misperception of oily water and beaches could still get damages.
“I believe what Mr. Feinberg was saying was under Florida’s law, you couldn’t get any damages or recovery from that. In fact, we believe he’s quite wrong about that.”
It’s unclear the context of Feinberg’s remarks on Florida law, but I doubt he is suggesting that claims under the federal oil pollution act should be construed pursuant to Florida common law.
So that whole issue is a red herring.
On state tort and statutory claims brought solely under Florida law, however, I think McCollum has a point with respect to “misperception” claims. Also, by the time these claims are heard there will in fact be some oil dispersion along Florida’s beaches (there already is).
You can read the entirety of McCollum’s halfway-decent letter to Feinberg here.