Reference no: EM131914811
Problem: 2010 Gulf Oil Disaster: BP Contracts Unfair/Unconscionable?
In May 2010, British Petroleum (BP) oil company was in the midst of frantic efforts to stop the oil flowing into the Gulf of Mexico from its doomed Macondo 252 well while also trying to clean up the immense quantity that escaped after the explosion of the Deepwater Horizon drilling vessel. "Several hundred" shrimpers, oyster harvesters, and others making their living from the Gulf signed contracts with BP to work as paid volunteers in the cleanup process. Among the provisions in those contracts were promises by the volunteers not to file legal claims against the oil company should they sustain damages of any kind in the cleanup process. The provisions, which many of those signing may not have fully understood, included promises not to sue in case of accident or injury and not to talk to anyone about the disaster or cleanup without BP approval.
Those provisions also required a 30-day notice before pursuing legal claims against BP, even in the event of an emergency. Reportedly, BP also expected workers to add the oil giant to their personal insurance policies so that worker injuries or damages would fall to each worker's insurance rather than to BP. Commercial fisherman and United Commercial Fisherman's Association president, George Barisich, filed suit to block enforcement of the restrictive promises and U.S. District Judge Helen Berrigan ruled the offending provisions were overbroad and "unconscionable" and declared them null and void. BP and the Fisherman's Association soon reached an agreement removing the waiver language and agreeing not to enforce those provisions in contracts already signed. BP officials said the provisions were a "mistake," and they ordered the provisions removed as soon as they learned about them.
Questions
1. a. Were BP's protective provisions "wrong" as a matter of ethical business practice? Explain.
b. If you were a boss or lawyer at BP, would you have included those protective provisions? Explain.
2. a. If you were a boss and you knew you could compel an employee to accept a pay cut in order to enhance an already healthy bottom line, would you do so? Explain.
b. In your personal life, do you think you have made agreements with friends that were "one-sided" and "unconscionable" because of your possession of superior leverage of some kind?
c. If so, were you "wrong" to do so. Explain.