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Settlement talks are underway between BP’s attorneys and attorneys representing thousands of plaintiffs who claim they were damaged by the massive Deepwater Horizon oil spill. The talks are focused mainly on the $14 billion left in the $20 billion compensation fund set up by BP in 2010 to pay damage claims. See the WSJ article here.

Sources close to the situation suggest that the parties are actually closer than many would expect and that a settlement may be announced as early as Tuesday.

The secretive talks have been on-and-off for the past several months, but were made public on Sunday when parties announced that the civil trial scheduled to begin Monday would be postponed so that talks could continue.

To date the $20 billion fund set up by BP to pay damages has paid out roughly $6.1 billion to some 200,000 individuals and businesses who have submitted damage claims.

Some plaintiffs’ attorneys have criticized the fund as moving too slowly and making insufficient offers to settle damage claims, but others have said that the fund is actually doing a rather good job of paying out damage claims in a timely manner.

Some close to the situation believe that a settlement would most likely involve additional payments by BP, but it is all speculation at this point.

Any settlement would require the approval of U.S. District Court Judge Carl Barbier, who is in charge of over-seeing the thousands of lawsuits that have been consolidated to the multi-district litigation (MDL) in New Orleans.

Hopefully we will hear the good news of a settlement in the coming days.

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