CLAIM SUMMARY/DETERMINATION FORM

Claim Number N10036-1494 

Claimant George E. Chavez

Type of Claimant Private (US)

Type of Claim Loss of Profits and Impairment of Earnings Capacity

Amount Requested $20,000.00 

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 claims for certain individual and business 

claims on behalf of BP.

CLAIM AND CLAIMANT

On 12 October 2011, George E. Chavez (the Claimant) presented a claim to the Oil Spill 

Liability Trust Fund (OSLTF) for $20,000.00 for Loss of Profits and Impairment of 

Earnings Capacity allegedly resulting from the Deepwater Horizon oil spill. 

The Claimant stated he developed a design to cap the Deepwater Horizon oil spill.

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 He 

responded to Broad Agency Announcement (BAA) HSCG-10-R-R-00019.2

 The Coast 

Guard’s Research Development Center (RDC) issued the BAA 04 June 2010 calling for 

the submission of white papers on vendor-proposed technology solutions to the oil spill.3 

June 2010, the Claimant e-mailed his idea for capping the oil spill to RDC.4 The 

Claimant stated the claim is for the time he spent to develop his idea. The Claimant 

stated that BP did not use his idea.5

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 Section 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 

1 OSLTF Claim Form signed by Claimant 12 October 2011 2 Letter from Claimant dated 21 October 2011 in response to NPFC’s requested for additional information

3 See Website www.uscg mil/acquisition/rdc/newsroom.asp

4 Copy of Claimant’s e-mail addressed to RDC-BAA-DHR dated 09 June 2010 5 Based on telephone conversation between Claimant and NPFC staff person 24 October 2011

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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:

(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, Claimant submitted the following documentation:

• OSLTF Claim Form signed by Claimant 12 October 2011;

• Fax to PO Hardin, USCG, dated 01 August 2011 in response to sum certain of 

claim;

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• Letter from PO Hardin, USCG, dated 11 July 2011 concerning sum certain of 

claim;

• Letter from Claimant to NPFC advising of Claimant’s wish to be included in 

MDL-2179;

• Letter from Claimant dated 21 October 2011 in response to NPFC’s requested for 

additional information;

• Copy of Claimant’s e-mail to RDC-BAA-DHR dated 09 June 2010.

Claimant’s Optional OSLTF Claim form indicated that the Claimant filed a claim in the 

multidistrict litigation now pending in the United States District Court for the Eastern 

District of Louisiana (MDL-2179 In Re: Oil Spill by the Oil Rig “Deepwater Horizon” in 

the Gulf Of Mexico, on April 20, 2010) against BP (the “MDL”) on 20 April 2011. 

Although under the Statute the NPFC may not approve and certify the payment of a claim 

during the pendency of an action by the person in court to recover costs which are the 

subject of the claim, the NPFC may adjudicate such a claim to determine whether it may 

be compensable. Where appropriate, such a claim may be denied.

On 19 October 2011, the NPFC sent the Claimant a letter requesting additional 

information in order to evaluate the claim. On 21 October 2011, the Claimant responded 

to the request.

Before presenting the claim to the NPFC, the Claimant filed an Emergency Advance 

Payment (EAP) with the GCCF.6

 The claim was assigned Claimant ID #1152100 and 

claim #3005919. The EAP claim was denied on 12 November 2010.

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 Additionally, 

Claimant filed Full Review Final (FRF) Claims Final with the GCCF.8

 The claims were

assigned claims #9020945 and #9211223. The FRF claims were denied on 06 May 2011 

and 27 August 2011.

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Based upon the evidence provided by the Claimant, it appears that the subject matter of 

the GCCF claims is the same as the subject matter of the claim before the NPFC, i.e., 

Claimant lost earnings as a result of the Deepwater Horizon oil spill. The NPFC has not 

been able to confirm the amount of either the EAP or FRF claims as of the date of this 

determination. The NPFC deems the GCCF claims to be properly presented to the 

Responsible Party. To the extent the amount of the claims presented to the Responsible 

Party are equal to or greater than the amount currently presented to the NPFC, the subject 

claim is properly presented to the NPFC. Accordingly, this Claim Summary 

Determination for NPFC Claim N10036-1494 considers and addresses the loss of real or 

personal property up to the amount of $20,000.00 for all claims presented to the 

Responsible Party, specifically: GCCF Claim #3005919 EAP and #9020945 and 

#9211223 for FRFs.

6 GCCF On-Line Claim Status 21 October 2011 7 GCCF Denial Letter dated 12 November 2010

8 GCCF On-Line Claim Status 21 October 2011 9 GCCF Denial Letters dated 06 May 2011and 27 August 2011

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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 or destruction or loss of real or personal property or 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 the claim. 

The Claimant stated he estimated he spent a week’s time researching, drawing and 

proving his ideas.10 The NPFC requested he provide support of the time he spent.

11 The 

Claimant’s response to the request provided no explanation or supporting documentation 

for his loss computation. Subsequently, the NPFC claims staff spoke with the Claimant. 

The Claimant stated that he did not keep track of his time. The amount of the claim was 

an estimate.12

NPFC requested that the Claimant describe exactly the work he did and explain how the 

Deepwater Horizon oil spill caused his loss.13 The Claimant’s response did not describe 

his work or explain how the oil spill caused his alleged loss. The Claimant stated that his 

design to cap the oil spill was not used.14

The Oil Spill Liability Trust Fund (the Fund) is available to pay claims for 

uncompensated removal costs approved by the Federal On Scene Coordinator and 

consistent with the National Contingency Plan (NCP), and damage claims include: (1) 

damages for injury to, or economic losses resulting from the destruction of real or 

personal property recoverable by any person owning or leasing that property; (2) 

damages equal to the loss of profits or impairment of earnings capacity due to the injury, 

destruction, or loss of real or personal property or natural resources, which shall be 

recoverable by any claimant. 33 U.S.C. § 2702(b)(1) and (2)(B) and (E). 

Claimant’s asserted that he developed a cap for the Deepwater Horizon incident that was 

not used. The Claimant asserted that he incurred costs to research and develop his idea 

although the cost associated with this submission is not an OPA compensable damage. 

Further, even if Claimant’s alleged damages were OPA-compensable, he has provided no 

detailed information on the associated costs or expenses with his cap. 

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

that there was an alleged loss in the amount claimed, (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, and (3) the amount claimed is not an OPA 

compensable damage.

10 Letter from Claimant dated 21 October 2011 in response to NPFC’s requested for additional information 11 See NPFC’s letter to Claimant dated 19 October 2011 requesting additional information on his claim. 12 Based on telephone conversation between Claimant and NPFC staff person 24 October 2011 13 See NPFC’s letter to Claimant dated 19 October 2011 requesting additional information on his claim. 14 Based on telephone conversation between Claimant and NPFC staff person 24 October 2011

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Claim Supervisor: Claims Adjudication Division

Date of Supervisor’s Review: 25 October 2011

Supervisor’s Action: Denial approved

Supervisor’s Comments:

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