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Federal And State Officials Want BP To Do More

Publication Date: 
June 14, 2010
Source: 
St. Petersburg Times
Author: 
Jackie Calmes

Professor Joseph Grundfest is quoted on whether or not the government has the power to reduce or suspend BP from issuing dividends. Jackie Calmes of the St. Petersburg Times filed this story:

BP mounted a more aggressive response to the oil spill in the Gulf of Mexico on Sunday as the U.S. government stepped up the pressure on the company.

President Barack Obama is expected to arrive on the Gulf Coast today for a two-day visit — including a stop in Pensacola on Tuesday — that will be followed by a nationally televised address to the American people on Tuesday night and a sit-down with BP executives on Wednesday.

...

On the financial side, legal experts are divided over the government's power to force BP's hand by blocking a dividend. "I'm not aware of any legal precedent that would give the government any authority that would preclude British Petroleum from paying dividends," said Joseph A. Grundfest, a law professor at Stanford Law School.

BP's status as a foreign corporation further complicates matters, he said. "There's no suggestion that British Petroleum lacks the money necessary to pay all claims or damages that might result from this calamitous spill," Grundfest said.