The following is published with permission of the author.
Just when you thought the extreme leftists in government couldn't find a more sleazy way to extort money from businesses, we find the New York state comptroller's office (NYCO) finding a creative way to capitalize on the Deepwater Horizon oil spill. How is it that one of the states farthest away from the tragedy managed to do this? Why, sue them for lost investment, of course! "(The) New York's state comptroller said its pension fund will sue BP for what he called the company's "disastrous" management of the oil spill in the Gulf. The New York State Common Retirement Fund, with $132.6 billion in assets, owned more than 19 million shares of BP on April 20, when an explosion on a rig leased by BP killed 11 workers and left an undersea well spewing out of control. BP's shares since then have lost about half of their value. The stock is widely held by pension funds. "BP misled investors about its safety procedures and its ability to respond to events like the ongoing oil spill and we're going to hold it accountable," said New York Comptroller Thomas P. DiNapoli."
For just a second, put aside the fact that BP screwed up. Really, really screwed up. It's definitely not an easy thing to do, particularly if you're from a Gulf state or even had vacation plans in one this year. There definitely is no excusing their incompetence in mitigating the risks on this project and I'm not sad to see them forced to compensate the people and businesses they adversely impacted. Fair is fair. However, once you are able to set aside this fact, consider the basis of this frivolous tort: An enterprise (NYCO) invested money (colloquially referred to as "risk capital"; notice the word "risk") in the market, specifically betting on the performance of a particular company (BP). As a result of a major accident, the market price of the stock decreased. Now, the spurned investor wants their money back. This is absolutely brilliant! Just think, on the basis of this lawsuit, no one should ever lose money in the stock market.
Next time I put money into a biopharmaceutical stock, I'll just have to remember to sue the company for the lost delta in my investment when their drug doesn't make it through phase II clinical trials. Next time Microsoft releases a new version of Windows and then has to release a patch to the software (which always causes a downward adjustment), I'll just sue Ballmer and crew to get my money back. If Nike sees civil unrest in a country where its clothes are manufactured, I'll be on the phone to my lawyer that very afternoon. Maybe we can even extrapolate this to my next trip to Las Vegas. "Yes, I know I threw the dice, but I was expecting a seven or eleven, not boxcars. Now, gimme my money back or I'll sue your ass!"
The worst part is that as angry as I am with BP (and I am pretty angry with them), I can't stomach the actions of NYCO. Ultimately the people that will be adversely impacted by this will be the consumers, as BP will need to adjust their pricing to offset the losses caused by such a lawsuit. In other words, gas prices will go up in the Gulf states in order to pay for the money that was extorted by the government workers in the state of New York. Talk about adding insult to injury.
Written By Jay Radke
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