Jury rejects claims Kevin Costner duped Stephen Baldwin, others in BP spill cleanup
ASSOCIATED PRESS June 14, 2012 8:08PM
Kevin Costner, center, arrives at Federal Court on Thursday, June 14, 2012 in New Orleans. A jury is set to hear closing arguments in the trial for Stephen Baldwin's lawsuit against Costner over their multimillion dollar business dispute in the aftermath of the 2010 oil spill in the Gulf of Mexico. The lawsuit accuses Costner and Smith of duping Baldwin and friend Spyridon Contogouris over their investments in an oil cleanup device that BP used after the spill. (AP Photo/Gerald Herbert)
Updated: June 14, 2012 8:10PM
NEW ORLEANS (AP) — A federal jury late Thursday rejected claims that Kevin Costner and his business partner duped fellow actor Stephen Baldwin and a friend out of millions of dollars from a BP contract for using oil cleanup devices in the aftermath of the 2010 Gulf of Mexico spill.
The panel deliberated for less than two hours before delivering the verdict in the lawsuit brought by Baldwin and his friend, Spyridon Contogouris Their lawyer had asked the eight-member jury to award the plaintiffs more than $17 million in damages.
The jury gave them nothing.
Costner, who smiled and shook his attorney’s hand after the verdict, said he was grateful for the opportunity to clear his name.
“My name means more to me than money and that’s why we didn’t settle,” he said shortly after the verdict.
Costner also praised the jury for “doing their best to understand everything” in a complex case.
“They were really smart, and it was my good luck that they saw the truth of the story,” he said.
Contogouris and Baldwin sold their shares in Ocean Therapy Solutions for $1.4 million and $500,000, respectively. Baldwin testified he would have held out for much more if he had known BP had committed to ordering 32 oil-separating centrifuges.
They were trying to collect $17 million in damages because they estimate it’s how much they would have received if they hadn’t sold their shares in the company that marketed the centrifuges to BP before the oil giant made an $18 million deposit on a $52 million order.
Attorneys for Costner and Smith said Baldwin and Contogouris knew that BP was preparing to order the centrifuges when they sold their shares and walked away from the company rather than gamble for a more lucrative payout if BP signed a binding contract. At the time they sold their shares, BP only had signed a non-binding letter of intent, the defendants’ attorneys said.
Baldwin referred questions about the verdict to his attorney, James Cobb.
“We’re disappointed. We thought we proved rather convincingly that these two guys, Mr. Costner and Mr. Smith, defrauded us,” Cobb said. “The jury saw it a different way but we respect the jury’s verdict.”
Cobb also questioned whether celebrity was a factor in the outcome “because I believe we proved our case and because the bigger celebrity won.”
Earlier Thursday, during the trial’s closing arguments, Cobb told jurors they probably see the case as a “bunch of rich people fighting over money I’ll never, ever see.” Cobb, however, said his clients deserved to be compensated for being lied to by Costner and business partner Patrick Smith and defrauded out of their fair share of the BP money.
“I had no idea the spider’s web of deception could be so pervasive and so hard to unravel,” Cobb said.
Costner’s attorney Wayne Lee argued his client’s fame is the only reason he was sued. The plaintiffs were mistaken when they thought Costner would “roll over and give in” under the threat of a lawsuit, Lee said.
“This lawsuit never should have been brought,” Lee said. “Mr. Costner never should have been a party to these proceedings.”
Cobb said a series of text messages and emails show that Smith and Costner knew the BP deal was done before Baldwin and Contogouris sold their shares.
Jurors heard eight days of testimony before they began deliberating. Costner and Baldwin were ordered by U.S. District Judge Martin Feldman to attend each day of the trial, which they heeded. The judge thanked them at the end of the trial.
“I know that being here throughout the trial has been a great challenge for them,” Feldman said.
Costner testified that he never saw Baldwin contribute anything to their company’s efforts to persuade BP to use the centrifuges. Baldwin testified that no one asked him to invest any capital or lobby BP but said he used his celebrity to market and promote the centrifuges while he also worked on a documentary about the nation’s worst offshore oil spill.
Costner had lost $20 million in an earlier effort to market the devices to the oil and gas industry, but Cobb said Costner and Smith each made $15 million off their investments in Ocean Therapy Solutions after the BP spill.
Jurors heard testimony that John Houghtaling, the company’s CEO, had begged Baldwin and Contogouris not to sell their shares and promised them that a deal with BP was imminent.
“They didn’t want to take a risk,” Lee said. “(Contogouris) is the one who brought up the idea of selling. He set the price.”
On Wednesday, a BP contractor testified that Baldwin had threatened to feed personal information about Costner to The New York Times if the two actors couldn’t resolve their business dispute. Scott Smith, CEO of a company that sold about $1 million worth of oil-absorbing foam to BP after the spill, said he doesn’t know if Baldwin followed through on the threat.
Cobb dismissed Smith’s testimony as a diversionary tactic.
“They bring that to you, folks, because they’ve got nothing else,” he said. “They don’t have a legitimate defense, so let’s throw some mud on the plaintiffs.”
BP deployed a few of the centrifuges on a barge in June 2010. The company capped the well the following month, and it was permanently sealed in September 2010.