CLAIM SUMMARY/DETERMINATION FORM

Claim Number N10036-1666

Claimant Karen Felix

Type of Claimant Private (US)

Type of Claim Loss of Profits and Impairment of Earning Capacity

Amount Requested $50,000.00.

FACTS 

On or about 20 April 2010, the Mobile Offshore Drilling Unit Deepwater Horizon (Deepwater 

Horizon) exploded and sank in the Gulf of Mexico. As a result of the explosion and sinking, oil 

was discharged. The Coast Guard designated the source of the discharge and identified BP as a 

responsible party (RP). BP accepted the designation and advertised its OPA claims process. On 

23 August 2010, the Gulf Coast Claims Facility (GCCF) began accepting and adjudicating 

certain individual and business claims on behalf of BP.

CLAIM AND CLAIMANT

On 27 January 2012, Ms. Karen Lynn Felix, (the Claimant) presented a claim to the Oil Spill 

Liability Trust Fund (OSLTF) seeking $50,000.00 in real or personal property damages resulting 

from the Deepwater Horizon oil spill.

1

On 15 June 2009, the Claimant commissioned an appraisal of a property located in Elberta, 

Alabama. The property appraised for $190,000.00 and was listed for sale at $179,000.00 shortly 

thereafter.

2

 The Claimant executed a sales contract in August of 2010, and sold the home for 

$140,000.00.3

 The Claimant alleged that the drop in value, from the appraised value of 

$190,000.00 to the actual sales price of $140,000.00 was due effects of the oil spill on the 

housing market in Elberta, Alabama.4 

As more fully explained below, because the Claimant has not alleged that her property was 

physically damaged as a result of the oil spill, but rather that her income from the sale of the 

property was reduced as a result of this spill, this claim has been re-categorized as a claim for 

loss of profits damages in the amount of $50,000.00.

APPLICABLE LAW 

Under the Oil Pollution Act of 1990 (OPA), at 33 U.S.C. § 2702(a), responsible parties are liable 

for removal costs and damages resulting from the discharge of oil into or upon the navigable 

waters or adjoining shorelines or the exclusive economic zone, as described in § 2702(b) of 

OPA. 

The OSLTF which is administered by the NPFC, is available, pursuant to 33 U.S.C. § 2712(a)(4) 

and § 2713 and the OSLTF claims adjudication regulations at 33 C.F.R. Part 136, to pay claims 

for uncompensated damages. One type of damages available pursuant to 33 C.F.R. § 136.231 is 

a claim for loss of profits or impairment of earning capacity due to injury to or destruction of 

natural resources.

Under 33 C.F.R. § 136.233 a claimant must establish the following:

1 Optional OSLTF Claim Form, signed on 12 January 2012. 2 Letter from Mark Struthers, regarding drop in the Claimant’s list price, 27 September 2010.

3 Remax Orange Beach, Sales Agreement.

4 Optional OSLTF Claim Form, signed on 12 January 2012.

 
(a) That real or personal property or natural resources have been injured, destroyed, or lost.

(b) That the claimant’s income was reduced as a consequence of injury to, destruction of, or 

loss of property or natural resources, and the amount of that reduction.

(c) The amount of the claimant’s profits or earnings in comparable periods and during the 

period when the claimed loss or impairment was suffered, as established by income tax 

returns, financial statements, and similar documents. In addition, comparative figures for 

profits or earnings for the same or similar activities outside of the area affected by the 

incident also must be established.

(d) Whether alternative employment or business was available and undertaken and, if so, the 

amount of income received. All income that a claimant received as a result of the 

incident must be clearly indicated and any saved overhead and other normal expenses not 

incurred as a result of the incident must be established. 

Under 33 C.F.R. § 136.105(a) and § 136.105(e)(6), the claimant bears the burden of providing to 

the NPFC, all evidence, information, and documentation deemed necessary by the Director, 

NPFC, to support the claim. 

Under 33 C.F.R. § 136.235, the amount of compensation allowable for a claim involving loss of 

profits or impairment of earning capacity is limited to the actual net reduction or loss of earnings 

or profits suffered. Calculations for net reductions or losses must clearly reflect adjustments 

for—

(a) All income resulting from the incident;

(b) All income from alternative employment or business undertaken;

(c) Potential income from alternative employment or business not undertake, but reasonably 

available;

(d) Any saved overhead or normal expenses not incurred as a result of the incident; and

(e) State, local, and Federal taxes.

DETERMINATION OF LOSS 

Claimant’s Submission to the OSLTF

To support this claim, the Claimant submitted the following documentation:

• Optional OSLTF Claim Form, signed on 5 October 2011;

• Email from the Claimant to the GCCF, 27 January 2012;

• Letter from the Claimant to the GCCF, 26 October 2010;

• U.S. Department of Housing and Urban Development, Settlement Statement;

• Letter from Mark Struthers, regarding drop in the Claimant’s list price, 27 September 

2010;

• Copy of the Claimant’s driver’s license;

• ReMax of Orange Beach, sales agreement;

• Property Appraisal;

• Summary Appraisal Report;

• GCCF Claim Form for claim for $50,000.00 in Real or Personal Property Damages;

On 7 October 2010, the Claimant presented a Final payment claim to the RP/GCCF, seeking 

Real or Personal Property damages in the amount of $50,000.00.5

 The Claimant was assigned 

5 GCCF United States Coast Guard Report, 21 February 2012.

 
Claimant ID 3120954 and the Final claim was assigned GCCF claim # 9032666.6

 The 

RP/GCCF denied payment on this claim.

On 27 January 2012, the Claimant submitted this claim to the NPFC, seeking $50,000.00 in Real 

or Personal Property damages. 7 The NPFC may adjudicate this claim to the extent that these 

damages have first been presented to the RP/GCCF.8

 Because the Claimant has presented these 

damages to the RP/GCCF in an amount equal to the amount now presented to the NPFC, this 

determination may properly address the entirety of the claim now before the NPFC, in the 

amount of $50,000.00.

NPFC Determination

On 27 January 2012, the Claimant presented this claim to the NPFC for $50,000.00 in real or 

personal property damages. Under 32 U.S.C. § 2712(b)(2)(B), a Claimant may recover damages 

for injury to, or economic loss resulting from the destruction (emphasis added) of real or 

personal property.

In this case, the Claimant has not alleged that her property has been physically damaged or 

destroyed by the oil spill. Rather, the Claimant alleged that the oil spill caused a depreciation in 

property value, causing the Claimant to sell the home at a lower price than she would have, had 

the oil spill not occurred. As the property itself was not damaged, this claim has been 

reclassified by the NPFC as a claim for $50,000.00 in loss of profits and impairment of earning 

capacity damages, based on claimed diminution in property value.

Loss of Profits and Earning Capacity

Under 33 U.S.C. § 2702(b)(2)(E) and 33 C.F.R. Part 136, a Claimant must prove that any loss of 

income was due to injury, destruction or loss of real or personal property or of a natural resource 

as a result of a discharge or substantial threat of a discharge of oil. Under 33 C.F.R. § 136.105(a) 

and § 136.105(e)(6), the Claimant bears the burden of providing to the NPFC all evidence, 

information, and documentation deemed necessary by the Director, NPFC, to support this claim. 

In order to prove a claim for loss of profits damages based on diminution in property value after 

a property has been sold, a claimant must provide, at a minimum, evidence proving (1) the prespill value of the home (2) the post-spill value of the home, and (3) that the loss incurred at the 

time of the sale was caused by effects of the oil spill and not by other factors affecting the 

housing market, or affecting the sale of this property in particular.

This claim is denied because the Claimant has not provided documentation sufficient to prove 

that the Deepwater Horizon oil spill caused a quantifiable reduction in the sales price of the 

property in August of 2010.

In the course of review of this claim, the NPFC contacted the sales agent who coordinated the 

sale of this property. The agent indicated that since the home had been first listed for sale in 

August of 2009, it had not generated much interest due to its rural location.9

 The agent was also 

unable to recall any interested buyers for this property in the period prior to the Deepwater 

Horizon oil spill, indicating that the Claimant’s inability to sell the home at the original list price 

of $179,900.00, was not due to the Deepwater Horizon oil spill, but rather due to a general lack 

6 GCCF United States Coast Guard Report, 21 February 2012.

7 Optional OSLTF Claim Form, signed on 5 October 2011.

8 33 C.F.R. § 136.103(a).

9 PHONECON: NPFC Staff and ReMax Agent, 9 March 2012.

 
of interest in the property at that particular price point for at least nine months prior to the oil 

spill. 

Furthermore, the Claimant indicated that she eventually sold the property to her ex-husband, who 

according to the Claimant’s sales agent, was the only buyer interested in purchasing the property 

either before or after the oil spill. 10 In a phone conversation with the NPFC, the Claimant stated 

that her ex-husband had moved to a new residence, and chose to buy the Claimant’s property and 

resell it, rather than continue to make payments to the Claimant as she continued to incur various 

carrying costs.11 The Claimant indicated that her ex-husband had tried to negotiate a lower 

price, but stated that because the sales agreement was facilitated by a court, her ex-husband was 

restricted from purchasing the property below the eventual sales price of $140,000.00.12 Having 

considered these circumstances, the NPFC has determined that the Claimant has not proven that 

the Deepwater Horizon oil spill caused the Claimant to be unable to sell the home at the original 

list price of $179,900.00, or at the 2009 appraised value of $190,000.00.

This claim is denied because the Claimant failed to meet her burden to demonstrate (1) that she 

sustained a loss in the amount of $50,000.00, and (2) that the alleged loss is due to the injury, 

destruction or loss of property or natural resources as a result of a discharge or substantial threat 

of a discharge of oil.

Claim Supervisor: NPFC Claims Adjudication Division

Date of Supervisor’s Review: 3/19/12

Supervisor’s Action: Denial approved

Supervisor’s Comments:

10 PHONECON: NPFC Staff and ReMax agent, 9 March 2012. 11 PHONECON: NPFC Staff and the Claimant, 9 March 2012. 12 PHONECON: NPFC Staff and the Claimant, 9 March 2012.