>> appreciate very much what you are taking on. as a district judge, i was asked to take over what was deemed the biggest, worst tort claim in texas history that had been going on for 11 years with over 100 lawyers. anyway, took that on, so i have great sympath for what you are doing. i have questions. pardon my muddiness, it is something i carry with me. but i was wondering, do you know how you were chosen out of all the people in the united states do this job? besides being crazy enough to take it on? >> well, i was chosen by the administration a bp by agreement. you'll have to ask representatives of both as to why they are relying on me to act independently. i suspect that others have pointed out my prior work. >> all rightbut you don't know who selected you? who called you, the president? >> no, i have never talked to the president about this. on the bp side, i had two meetings with bp officials in houston. they asked me to come down and meet and talk about my experience. and on the administration side, the contact person for me has been tom perelli. he is the one i've been dealing with. i think i had one conversation with carole browner of the white house, but, it has been tom perelli on thedministration side. >> today, y weren't subpeonaed, you came voluntarily correct? >> to this committee? >> yes. i always come when the chairman invites me. >> you said before other venues and it seems clear that you are not accountable to any one, the administration, so, is there anyone who you do account to? >> i think i'm accountable to the people in the gulf that i am trying to help. >> what if they disagree with your decision? >> i think they would voice their feelings to the members of this committee. >> hwho could fire you? >> i guess i could be fired by the administration or bp. >> you say you are accountable to the people in the gulf, but normally accountability carries with it the possibility that those to whom you are accountable can do something. >> i suppose they can complain to our committee and then somebody in that duo would fire you. >> i think that is right. >> they would agree that my service rz no longer needed. >> with the folks in the gulf. if they don't like your decision, did i understand there is an apel at review? >> there is a review by a panel that has yet to be selected. >> who will select the panel? >> the panel will be selected, names will be submitted to me. right now i select the panel. >> boy, i would love to got to choose those who got to review mine. >> let me say two things about this. if the claim ants have lost confidence in what i'm doing, there is no requirement that they sign up. there is no greater check on my ability to serve the people of the gulf than the people have lost confidence in me and voluntarily don't apply. if they are not aploying -- >> so you would self fire yourself? >> well, if i have nothing to do. no one is going to have to fire me, i will resign. you have an able staff, are they working pro bone know? >> no. >> who decides their salary. >> bp is paying for the entire cost of this facility. >> who decided on what their salaries would be? >> i will submit proposed salaries to bp. >>okay. >> bp has already been paid about 1500 tepeople in the gulf. we'll decide who should be continued and who shouldn't. on issue who paid for this facility has to be bp. you can't ask claim ants to pay. >> can they tell you they disagree with the salary you have set? >> i suppose they could say it. >> you mentioned jurisdiction, who set that? >> the jurisdiction has been established by the government and bp. >> the government being us? >> oh the administration. okay. >> and bp together chose me and explained my jurisdiction to me orally. >> and that is my current -- >> not that i've seen thank you. >> gentleman from california is recognizedor five minute. >> thank you madam chair. thank you for joining us. thank you for taking on this responsibity. >> it is good to have someone of your capability on the task. i want to follow up on some of the questions my colleagues asked. i apologize if you have to repeat some of the things you said earlier. i'm interested in when people submit a claim to you, is there ever a case -- do they have to wave a court remedy when they do so? >> yes. >> people who submit a clai to me, seeking emergency payments, pay the mortgage, put food on the table, i'm unemployed because of thespill, people who make such a claim can receive from the facility up to six months lost wages or lost income without any obligation they do not sign away any rights they may have to go to court, to sue, not sue, it is without obligation. sub subsequently, if they want to voluntarily request a lump sum final payment or additional esent or future damage, we will calculate that damage and offer them the claim ant here is a check for $600,000 or whatever it might be. only if the claim ant decides it is in his or her interest to take that check, then they would sign the release. >> it would wave any claim in the future against -- >> bp. >> if there was economic cost they would wave that? >> yes. >> is it presumed that the six month emergency assistant, should they litigate later would be deducted from the amount that bp would wow them? >> yes. >> if they won and if there was a damage award them? >> yes. >> if they won and if there was a damage awa them? >> yes. >> if they won and if there was a damage awa them? >> yes. >> if they won and if there was a damage awao them? >> yes. >> if they won and if there was a damage awaw them? >> yes. >> if they won and if there was a damage awa them? >> yes. >> if they won and if there was a damage award would be able to say you have damages of x but we paid you six months, so deduct that. >> and what you are trying to do in deterning an eligible claim is use the same principles of causization and proximity that the courts would deploy. >> that is the starting point. and the more i listen to the house staff and others, the starting point is probably for most of people claims involving business loss or wage loss not state law but the federa pollution control act which is more liberal in causization requirements. that is the starting point. then i would have to exercise my judgement in trying to decide whether a claim that might not even be eligible for compensation in court should never be paid as part of this fasignature. >> do facility. >> does bp have to give you permission to do that? >> no. >> even if it goes beyond what they have obligates under law, they have given you the discretion to say, under your judgement, we would be obliga obligated, you should go ahead and play the claim. >> and it is not limited to $20 billion. bp has made it clear, $20 billion, hopefully it is enough. but if not, they will honor subsequent obligations they may have. >> i assume they will keep an eye on the degree to which you find claims eligible to determine how much it will undergo? >> of course. >> i think the ultimate cost of this is going to be on the capacity of any company to pay the full costs. at some point, will the government claims for reimbursement be in competition with the claims for private parties? if there is a finite amount of resources that bp has, who will the debtor that bets the priority? >> in one sense they are already in competition. under this $20 billion that has been set aside, that $20 billion is used not only for the private claims that i'm administering, but for the government claims as well. the $20 billion is not targets just for the claims that i'm proce processing. it including tax revenue loss for states and cities what have you. bp has stated publicly and privately to the administration if $20 billion is not enough to cover all of this, they will, th promise to supplement the $20 billion with additional money. >> you are not adjudicating you yourself, the government claims, but they are paid out of the $20 billion? >> that is correct. >> so that mean that is there is some urgency, apart from the funding that people are submitting funding for right now, people in the gulf need to feel some urgency if they feel that the bp resources won't hold out if they want to seek a lump sum payment now rather than wait for litigation and bp that may or may not be able to pay all claims. there is a race for compensation? >>ou could put it that way. i think there is an urgency for claim ants to seek a lump sum apart from competition. i'm not concerned although you raise a valid, argument. i'm not couraged that there hcos to be a race for funds because the money may dry up. >> the gentleman's time is expired. >> i'm concerned that people not delay because they need the money and they ought to be racing to enter the facility. >> mr. poe of texas recognized for five minutes. >> thank you. trying to put this in perspective. i appreciate your thoughts on this, it is great. representing southeast texas the district that borders louisiana. because of the gulf stream, we don't get the oil spill it goes to louisiana. however, the people in my district work in louisiana. the direct injury but not being able to fish crawfish, shrimp all of that. and the second problem is, is the moratorium, i know you are not involved in that,ut has bp put money into a fund to pay for losts based on the moratorium? >> yes,ho is administering that fund? >> i don't think they have chosen an administrator for that fund yet. >> my understanding is as follows. >> you are correct. it is not on my watch. $100 million has been set aside unrelated to the $20 billion. not businesses associated with the moratorium, workers. that 100 million will be represented separately by a charity or non profit foundation in the gulf. i don't think they have selected anybody yet. >> i don't know. >> now as totexas, residents in the gulf who are joining louisiana fish and shrimp and harvest oysters, and as you put it, directly impacted, they should be filing a claim. there is no limitation as to who can file a claim. i have talked to the attorney general of texas and what is going on around gaeston. i urge those residents in your district to file a claim if they are being impacted. >> how many claim centers do you have in texas? >> right now 36 claim centers around the gulf. >> how many are in texas? >> i don't know. i don't think there are any yet in texas. the attorney general has suggested that we need one there. we mado that. i think right now thereare only 70 claims, i think from the galveston area. and if needed we will set up a facility there. >> another question on the same issue. i see, like judge gomer, i se a conflict of losses based on the actual damages of the oil spill. and the moratorium kind of meddling together. and are you going to make a decision that this is a claim based on the moratorium? that goes somewhere else? and so this percentage is based on the oil spill? >> the direct claims are not aproblem because as i understand it, the moratorium claims are only for moratorium impacted rig workers. nothing to do with the spill directly. so those determinations will be relatively straight forward and will be made by somebody else. the question posed earlier which is problematic is, somebody who files a claim for lost revenue, i have a motel on the beach, and i'm down 30%, and some of that is attributable to the moratorium. that is going to be tough evidencerywise for me to distinguish. >> regarding statute of limitations, do you have a statute of limitations that you are looking at on -- when the accident occurred to when eventually will all claim ants be paid through your agency? judge my understanding is the current protocol, urged a three-year statute of limitations. >> the facility that i'm administering wod be administered for three years. after which it would terminate on a date certain. claims would have to be brought within that three year period. >> thank you. the gentlelady is recognized for ve minutes. >> thank you mr. chairman. i want to express my appreciation for you beg here today and answering our questions and some may be deplicktive so i'm going to apologize for that. who is helping you to develop the process under which claims are going to be guided? >> who is helping you -- establish the process under which claims will be processed? >> i am relying on first and foremost the deputy whose worked with me on the other claims, 9/11 and virginia technology and agent orange, camille byrose in my firm. and then we are relying on outside consultants, garden city, brown greer in virginia. we are relying on people in it g gulf which has been already processing claims over $200 million worth of claims. most of the help that i will be relying on will be local help. you can't do this from washington, you need somebody else mentioned this, you need trusted people from the community. and will be using those vendors. >> arehere bp employees that are assisting in that claims process? >> well, there won't be in a few more weeks. right now, everybody is working for bp. in a few more weeks when the facility replaces bp we will be independent without bp employees. >> okay will you be at that point when the facility opens, relying on the guidelines that bp established? >> no. >> completely independent? is. >> yes, we will decide whether we verify and ratify them, but we will have our own criteria and our own procedures. >> you established earlier that bp is paying the salaries of staff that will be assisting you is that correct? >> bp will on going pay the staff. >> when the facility opens bp will be paying those salaries as well? >> yes. and bp better be paying the salaries with everybody associated with this, when you try and think of who else might pay it is in a short list. >> i happen to be in agreement with you there. will those salaries, will that payment come from the gulf coast compensation fund itself? or that fund is simply for the claim ants? >> everybody associated with facility that isn't a bp employee. once the facility takes over, all of that payment will come out of the $20 billion facility. it will be paid by the $20 billion. which is of course indirectly bp also. i'm pretty confident that the entire infrastructure, the entire salary of everybody associated with this facility will be more than covered by the interest on the $20 billion. >> okay. that was what i was getting at. who brs the ultimate cost of those salaries? >> you said that i believe you said it might be in your written testimony that there will be three judge panels to hear awards? >> appeals of deed claims? is. >> it will be a three-member panel. >> well i meant three adjudicators. >> right. >> thank you. so, claim ants will have an opportunity if they don't agree with that decision to this three member panel. will they have the opportunity to appeal awards that theyhink are not fully compensating them? >> yes. >> and those will be heard by the three-member panels? >> yes. >> how long do they have to decide to appeal their denials or compensation? >> i don't recall ten days. i don't want to delay getting money into the handsf claim ants that are unhappyith their award. >> my concern is i feel that it is likely that many of those clmn'ts may be representing them slefz p selves per se because it is set up in a way to keep them from lit gracious aigation and attor. you don't want it to be too brief for somebody ttake advantage of the appeals process. i agree with that. let me say this, i must say if you want one obvious example o my failure in this process, it is if people are appealing what i thought was sound judgement. if people start appealing to this panel, that is a significant bit of evidence that i'm not satisfied claim ants and i will view appeals if they are necessary, as a sign of failure and that is why i'm hoping that the nmber of appeals are pretty small. >> another question i have is, will bp have the opportunity to appeal a claim if they think it is unwarranted? >> the current protocol states that bp can request the right to appeal. but only i can grant or certify that right to appeal which will not easy be permitted. >> i appreciate the clarification. and the last question that i have for you is on the issue of undocumented workers who may have claims under the gccf. i know that the 9/11 victims compensation fund did allow undocumented workers or people regardless of their current immigration status to make claims. what is your opinion of folks in this scenario. >> i will do whatever the law requires. in 9/11, the administration, the bush administrion went to the department of immigration and received a ruling from the department that permitted undocumented workers to be eligible, their families to receive fullompensation just as if they were citizens of the united states. i have to follow the tax and immigration laws. if this committee or if who eve wants to include in compensation under this program, undocumented workers, and we can get a ruling from immigration that it is lawful and appropriate that it is the right thing to do, i will do whatever is agreed upon. i want to follow the law and i want to do whatever is permitted to maximize compensation. >> perfect, thank you for your answer and i yield back. >> i thank the gentlelady, gentleman from virginia mr. scott. >> you indicated something about your staff. do you know the number of layers you are going to be hiring and pa ra legals and other staff persons? >> no, i don't think this is a job that will require a great many lawyers on my staff. some, i'm a lawyer, um this is a job that will require experte in claims processing, in claims evaluation, in evaluating the legitimacy and proof of claims. i don't think this is a big project for lawyers myself. >> um, do you have an idea about the number of staff people? >> we are trying to develop that now. bp has hired 1600 people. that are currently employed throughout the gulf, local people, primarily local people who have been evaluating and processing claims and they have paid out as you know over $200 million in emergency payments. we will hire additional people as needed. we will reduce the size of the overhead as needed. >> i will notify your offic over the next 30 days. >> will you be hiring pple with the appropriate language skills? >> we are already doing that as i mentioned to congresswoman khu earlier. we have reachedut to the community we will hire as many experts as needed to make sure that whatever language barriers we've got to overcome that because we've got to get these people to file. you mentioned you won't have at many lawyers but indicated in previous answers that you are working with the trial lawyers and others to get volunteer lawyers. is it your undersndin that many of these will be eligible for legal aid services corporation? >> yes, and we are looking for any and all local or nional organizations to help us with pro bone know legal assistance for claim ants. >> will claims for injuries include pain and suffering? or just medical expenses? >> well,you know -- i knew you would hit me with a good question. under the 9/11 fund, pain and suffering associated with a physical injury was included. and i've got to think about that. i think if you are goin to be consist ent with the 9/11 fund it should be. >> you probably have things more intense than this situation. psychological situations where it is my understanding that the request for mental health services has gone up significant significantly. >> i doubt it. if you start we've dealt with this with 9? 11. if you start compensating purely mental anguish without anxiety and strese will be getting miggions millions of people wa television. you have to draw the line somewhere. i think it unlikely that we would compente mental alleged damage without a significant physical injury as well. >> will you be doing clean up expenses? >> no, not on my watch. >> business losses? >> yes. and you mentioned in