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Stephen Baldwin and Kevin Costner Embroiled in BP Lawsuit

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The Deepwater Horizon explosion -- that killed 11 men, injured 17, and spewed nearly 5 million barrels of crude oil into the Gulf of Mexico before the gusher was finally capped in July 2010 -- was the source of many a lawsuit.

The tragedy implicated a “who’s-who” of the petroleum industry. Among those responsible in some capacity for the spill were BP (BP), BP partners Aandarko and the MOEX subsidiary of Mitsui & Co (MITSY), drilling rig contractor Transocean (RIG), and the company in charge of cementing the well, Halliburton (HAL).

Now, even Hollywood celebrities are getting sued for their part in the worst offshore oil spill in US history. Though his involvement was beneficial in nature that served to facilitate the cleanup effort, Kevin Costner has been put in the legal hot seat this week by none other than the second least famous Baldwin brother, Stephen.

Baldwin has slapped Costner with a securities fraud and misrepresentation lawsuit involving oil-separating centrifuges developed by Costner in Nevada Corporation and marketed by Ocean Therapy Solutions (OTS) to BP.

Call it Bio-Dome v. Waterworld.

Jury selection began Monday. The federal suit alleges that Baldwin and his friend Spyridon Contogouris, who both joined the marketing side of the venture, were duped into selling their combined $2 million in OTS shares after Costner landed a secret contract with BP. Claiming they were deliberately left out of a June 2010 meeting between Costner, OTS’ CEO Patrick Smith, and BP, the plaintiffs were not made privy to a $52 million deal for 32 of the devices. Costner then used BP’s $18 million deposit on the order to buy the men out of the company.

“It was designed to give us a fighting chance, to fight back the oil before it got us by the throat,” Costner  said in 2010 about his invention.

Baldwin and Contogouris believe they were entitled to shares of the BP deposit and are seeking $21 million in damages. But Costner’s version of events has him completely unaware that Contogouris had agreed to sell his shares.

“Not only did Costner not know that Plaintiffs were negotiating to sell their OTS interests,” says Costner’s filing, “he was surprised and offended by the idea that Contogouris and Baldwin would walk away from OTS with almost $2 million in cash despite having invested no money in the company, and at a time when a contract with BP was uncertain to materialize.”
POSITION:  No positions in stocks mentioned.