As we celebrate our three year anniversary for the completion of our engagement in Louisiana, we fondly remember our most challenging experiences in the Firm history with great accomplishment!
The Deepwater Horizon Oil Spill (BP Oil Spill / Gulf of Mexico) is considered the largest accidental marine oil spill in the history of the petroleum industry. Beginning on April 20, 2010, the spill resulted in an estimated 200 million gallons of oil entering the Gulf waters – impacting 68,000 square miles of ocean.
Cowheard, Singer & Company was immediately engaged, deploying to Hammond, Louisiana on May 12th, 2010, to assist in evaluating the economic damage and lost profit claims as a result of the spill. May 12th will live forever in the history of the Firm as the single most important millstone. During this engagement we developed a highly customized methodology for evaluating lost profit claims in the aftermath of the incident; taking into account both the microeconomic environment of the Gulf Coast, as well as the “known unknown” long-term impact on local businesses and industry.
In June 2010, President Obama appointed Kenneth Feinberg to act as the independent claims administrator of the Gulf Coast Claims Facility (GCCF) – a $20 billion fund set up for those claimants affected by the spill. The GCCF selected Cowheard, Singer & Company as one of the lead forensic accounting teams tasked with performing complex lost profit claims for thousands of claimants throughout the Gulf coast.
The Firm, led by David Cowheard and Jesse Singer, developed large scale financial models and industry-tailored benchmarks in order to perform complex lost profit calculations for multiple industries from Texas to Florida, including: hospitality, commercial fishing / harvesting, retail, construction and development, and transportation. The Firm took into account each claimants individual circumstances and unique business model in order to ensure fair and adequate compensation in response to their respective economic impact. The development of these models was a monumental imperative to the overall success of the program.
During the two year period of the engagement we provided lost profit computation and economic damage valuations as well as assisted the Fund Administration Team with the analysis and review of potentially fraudulent claims for reporting to the Department of Justice. The Firm also provided direct assistance to field offices / claims assistance centers throughout the Gulf states in order to have their experts meet with claimants and representatives in order to facilitate the claims submission and review process.
Over the Firm’s engagement, we estimate that we prepared 20,000 to 25,000 damage calculations totaling over $500,000,000 of the approximately $6.1 billion to over 200,000 claimants that the Fund paid out.
The Firm returned to our headquarters in Miami, Florida, successfully assisting with and implementing one of the largest and most dynamic claims administration programs of its time.