In what may become an avalanche of litigation, BP PLC is being sued by two U.S. pension funds for its role in the Deepwater Horizon oil disaster.
Fifteen directors of BP—including CEO Tony Hayward and chair Carl-Henric Svanberg—are named as defendants in the suits, brought forward by the Louisiana Municipal Police Employees Retirement System, which represents more than 10,000 current and retired police officers.
The pension fund owns 400,000 BP shares.
The suit alleges that BP neglected to enforce safety standards, which ultimately led to substantial decreases to the company’s long-term value. It accuses the energy giant of negligence and a failure in governance.
BP is also facing a separate class-action suit by a group of shareholders that alleges the company misled investors prior to the April 20 Deepwater Horizon disaster. The suit cites the company’s troubled safety record, which includes workplace fatalities, regulatory fines and controversial cost-cutting.
Shareholders allege BP violated the Securities Exchange Act of 1934 by issuing misleading statements regarding safety, technology, inspections and precautions at its offshore oil facilities.
BP is under increasing pressure to stem the flood of crude oil spilling into the Gulf of Mexico, but 63 days after an explosion destroyed the Deepwater Horizon rig and killed 11 workers, the oil continues to flow.
The company’s stock has fallen by almost half, prompting some analysts to suggest it may become a takeover target or file for Chapter 11. It is also hurting pension plan members—particularly those in the U.K.—who are heavily invested in the stock.
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