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BP sues EPA to overturn contract suspension

Ohio residents may be surprised to hear that the EPA has stopped allowing new contracts to be issued to BP, the oil giant responsible for spilling over 200 million gallons of oil into the Gulf of Mexico three years ago. BP is now suing the EPA over a temporary ban that began in November of last year. According to the oil company, the suspension is "punitive, arbitrary, capricious, and an abuse of EPA's discretion." The company is requesting that the courts invalidate the suspension and prevent the EPA from enforcing it.

According to the EPA, the suspension will stay in place until BP demonstrates that it "meets federal business standards." However, this type of action is fairly rare in business litigation, especially for such a large company and so long after a disaster has taken place. According to a law professor at the University of Maryland, these types of penalties are usually reserved for companies that have been involved in embezzlement or fraud.

Another issue that BP has with the suspension is that the government has awarded the company 23 fuel contracts since the incident occurred. The oil giant also believes that 21 subsidiaries of the company, which were not involved with the Gulf oil spill, should not be penalized. To date, BP has paid $4.5 billion in fines and pleaded guilty to a number of charges related to the accident, including 11 felony counts of misconduct and neglect and one felony count of obstructing justice.

There are numerous regulations that businesses must follow or risk running into legal problems. A lawyer may help a business owner understand what is expected of them by state and local governments and represent them in court if the need arose.

Source: Huffington Post, "BP, EPA Spar Over Government Contract Suspension", Kate Sheppard, August 23, 2013

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