CERTIFIED MAIL – RETURN RECEIPT REQUESTED 5890/DWHZ 

Number: 7011 2000 0001 1246 5932 18 March 2014 

 

SmithCal Realty Trust 

 Re: Claim Number: N10036-2020

Dear Mr. Calianos: 

The National Pollution Funds Center (NPFC), in accordance with the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et 

seq. (OPA) and the associated regulations at 33 C.F.R. Part 136, denies payment on the claim number N10036-2020

involving the Deepwater Horizon oil spill. Please see the attached Claim Summary/Determination Form for further 

explanation. 

You may make a written request for reconsideration of this claim. The reconsideration must be received by the 

NPFC within 60 days of the date of this letter and must include the factual or legal basis of the request for 

reconsideration, providing any additional support for the claim. However, if you find that you will be unable to 

gather particular information within the time period, you may include a request for an extension of time for a 

specified duration with your reconsideration request. 

Reconsideration of the denial will be based upon the information provided. A claim may be reconsidered only once. 

Disposition of that reconsideration in writing will constitute final agency action. Failure of the NPFC to issue a 

written decision within 90 days after receipt of a timely request for reconsideration shall, at the option of the 

claimant, be deemed final agency action. All correspondence should include claim number N10036-2020. 

Mail reconsideration requests to: 

Director (ca) 

NPFC CA MS 7100 

Sincerely, 

Claims Adjudication Division 

National Pollution Funds Center 

U.S. Coast Guard 

Enclosure: Claim Summary/Determination 

U.S. Department of 

Homeland Security

United States

Coast Guard

Director

National Pollution Funds Center

United States Coast Guard

NPFC CA MS 7100

US COAST GUARD

4200 Wilson Blvd. Suite 1000

Arlington, VA 20598-7100

Staff Symbol: (CA)

Phone: 800-280-7118

E-mail: arl-pf-npfcclaimsinfo@uscg.mil

Fax: 703-872-6113
2

CLAIM SUMMARY/DETERMINATION FORM

Claim Number N10036-2020

Claimant SmithCal Realty Trust

Type of Claimant Corporate

Type of Claim Loss of Profits or Impairment of Earning Capacity

Amount Requested $200,000.00

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 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.

On 08 March 2012, the United States District Court, Eastern District of Louisiana issued a "Transition 

Order" (TO) limiting the GCCF's ability to accept, process, or pay claims except as provided in that order. 

The TO created a Transition Process (TP) to facilitate the transition of the claims process from the GCCF 

to a proposed Court Supervised Settlement Program (CSSP). The Court granted Preliminary Approval of 

the proposed settlement agreement on 02 May 2012, and the CSSP began processing claims on 04 June 

2012.

CLAIM AND CLAIMANT

On 04 December 2013, Mr. Jonathan Calianos submitted a claim for his company, SmithCal Realty Trust 

(the “Claimant”) to the Oil Spill Liability Trust Fund (OSLTF) seeking $200,000.00 in loss of profits or 

impairment of earning capacity damages allegedly resulting from the Deepwater Horizon oil spill. 

At the time of the spill, the Claimant states that the property involved was a fully-furnished, high-end 

vacation rental in Bonita Springs, FL. The Claimant marketed the home as a “turn-key vacation 

experience” with rent starting at $3,200 per month for a rental period of a six month minimum. The 

home is located in a gated country club community, approximately two miles from the beaches of the 

Gulf of Mexico. The Claimant states that while the home was rented in January 2010, the tenant left 

a little early in April 2010 shortly after the spill, threatening to sue if they were not provided a refund 

of $5,000.00. Claimant further stated that they did not provide a refund and no law suit has been filed 

to date. From May 2010 to December 31, 2010, the Claimant states it did not get any serious rental 

inquiries and had no commitments. In 2011, the Claimant did not get any returning clients and had 

few rental inquiries. The Claimant finally rented the property last-minute from August 1, 2011 to 

March 30, 2012, but for a deeply-discounted price total of $10,750. For 2012, the Claimant had no 

rental income and no firm commitments for future rentals. Claimant states all of this was as a result 

of the negative stigma associated with the oil spill, and the perceived health risks of 

dining/vacationing along the Gulf. 

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 water, adjoining 

shorelines, or the exclusive economic zone of the United States, as described in § 2702(b) of OPA. 
3

The OSLTF is available to pay claims for uncompensated damages pursuant to 33 U.S.C. § 2712(a)(4) 

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

(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; and

(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 undertaken, 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.

Under 33 U.S.C. § 2712(f), payment of any claim or obligation by the Fund under OPA shall be subject to 

the United States Government acquiring, by subrogation, all rights of the claimant or State to recover 

from the responsible party.

DETERMINATION OF LOSS 

Claimant’s Submission to the NPFC

The Claimant submitted the following documentation in support of this claim:

 Claimant Statement of Damages;

 Claimant Statement of Value of Real Estate;

 Claimant Rental Log for claimed property;

 Claimant’s General Ledger for claimed property, 2007-2012.
4

The Claimant alleged that this claim was first presented to the Responsible Party and that the RP 

denied payment on this claim.1 On 13 March 2014, the Claimant presented this claim to the 

NPFC, seeking $200,000.00 in loss of profits or impairment of earning capacity. The NPFC will 

adjudicate the claim to the extent presentment requirements have been satisfied. If any damages 

subject of this claim were not first presented to and denied by the RP, these damages are denied 

for improper presentment.2

Evidence in this claim submission indicates that the Claimant is a member of the Deepwater Horizon 

Economic and Property Damage Class Action Settlement (E&PD Settlement).3

NPFC Determination

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 all evidence, information, and documentation deemed 

necessary by the Director, NPFC, to support the claim.

As an initial matter, it appears that the Claimant is a member of the E&PD Settlement Class, as the 

location of the investment property indicates that it is in Economic Loss Zone A. This claim is therefore 

considered to have been settled, and the Claimant is ineligible to recover funds from the OSLTF. 

According to OPA, the payment of any claim by the NPFC is subject to the NPFC’s ability to obtain, by 

subrogation, the rights to recover all costs and damages from the responsible party. If a claim has been 

settled, the claimant no longer has rights to the claim and therefore cannot subrogate the NPFC to those 

rights.

While this claim may not have been quantified or paid, it is considered to have been settled by virtue of 

the Court’s preliminary approval of the settlement agreement. If the Claimant disagrees that he is a 

member of the economic damages class of the E&PD Settlement, he should submit evidence to indicate 

that he has either opted out or is excluded from the E&PD Settlement in his request for reconsideration of 

this claim.

Furthermore, even if the Claimant was not included in the Settlement Class, this claim is denied on its 

merits. In order to prove a claim for loss of profits or impairment of earning capacity damages, a 

claimant must provide evidence sufficient to prove (1) that the claimant sustained a loss or reduction in 

income, and (2) that the loss was caused by damage to real or personal property or natural resources 

caused by the discharge of oil during the Deepwater Horizon oil spill.

The Claimant alleged that, as a result of the oil spill, it lost income for its Bonita Springs, FL vacation 

rental home, namely, $75,000.00 in projected lost income and $125,000.00 in lost market value for the 

property. However, simply because a property is not rented does not mean it is a result of the oil spill. 

First, the Claimant shows its rental history for this property, but fails to produce documentation that it lost 

actual contracts as a result of the spill. It appears that, from 2007-2010, it had two sets of repeat 

customers, for half of each year, but does not provide why these same tenants chose not to continue 

renting this property. The Claimant also states that the tenants renting from January 2010 through June 

2010 left early, abandoning their leasehold, but, again, does not provide documentation as to how this was 

a result of the spill. The tenants’ decision to break the contract—which it appears that it was under a 

contract with the Claimant and disputed payments—may have been for any number of reasons; therefore, 

 

1 Claimant Statement of Damages letter.

2

33 C.F.R. § 136.103(c)(2).

3 At the time of the spill, the Claimant’s property was located within Economic Loss Zone D.
5

without proper documentation, it cannot be ascertained that they broke their lease because of the oil spill. 

Additionally, the Claimant does not provide copies of previous and post-spill contracts, how it advertised 

the property, or anything that would show that the decline was again, a result of the spill and not other 

factors.

It should be noted that the Claimant’s lost rental damages are projected costs based on a five-year scale of 

$15,000.00 per year. These claimed losses are speculative/prospective, and as such, are not 

incurred losses. Speculative losses are not payable under OPA; rather, only actual damages 

incurred. Thus they are denied.

Based on the foregoing, this claim is denied because the Claimant has failed to provide evidence 

sufficient to prove (1) that it sustained a financial loss in the amount of $200,000.00, or (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 discharge of oil. Additionally, this claim is considered to have been 

settled by virtue of the Claimant belonging to the E&PD Settlement and is therefore, not eligible for 

OSLTF compensation.

Claim Supervisor: NPFC Claims Adjudication Division

Date of Supervisor’s Review: 3/18/14

Supervisor’s Action: Denial approved

Supervisor’s Comments: