Chevron Using Deep Pockets to Manufacture "Proof" in $27 Billion Environmental Trial

Army of Paid Consultants Seeks Favorable Media Coverage

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Washington, D.C. – Chevron is using its deep pockets to hire three public relations firms to strengthen a misinformation campaign to evade a $27.3 billion judgment against the company in Ecuador for creating the worst oil-related contamination on earth in the Amazon rainforest, said spokesmen for dozens of Amazonian communities in the South American nation.

Plaintiffs have charged that Chevron's public relations team undermines the rule of law in Ecuador and interferes with U.S. foreign policy goals in the region, which encourage U.S. investors to respect local laws. Chevron has taken out several large advertisements in Ecuadorian newspapers attacking the judge and various court-appointed experts – advertisements which would violate the law in the U.S. -- and has announced it will not pay any adverse judgment, despite the fact it stipulated to a U.S. court that it would abide by any ruling in the country.

"Chevron is violating the rule of law in Ecuador and its American public relations firms are leading the charge," said Andrew Woods, an American lawyer who advises the local communities.

The three public relations firms used by Chevron are Edelman, Hill & Knowlton, and Sard Verbinnen. Separately, Chevron also has hired numerous lobbyists to pressure the Obama Administration to cancel trade preferences for Ecuador's government to retaliate for the fact its citizens are suing an American company, a strategy that to this point has failed.

"Chevron is gouging American consumers at the pump and then using the profits to pay public relations specialists to undermine a trial because the evidence is stacked against it," said Chris Lehane, a member of the legal team suing the company.

"Chevron has gone from using the Ecuadorian army to suppress indigenous protest to using an army of lobbyists and public relations executives to suppress justice," he added.

The public relations agencies bring controversy of their own. Hill & Knowlton has been caught lying on behalf of its corporate clients, including the tobacco industry when the agency created fake research denying a link between nicotine and lung cancer, and in 1991 when it coached a witness to lie before the U.S. Congress to justify the first Gulf War. Edelman is known for selling "green washing" services to corporate polluters – among them Chevron and the British coal company EOn -- to soften their negative image on environmental matters.

The lead on Edelman's Chevron account is Charles Bakaly, the former spokesman for special prosecutor Ken Starr during the Monica Lewinsky scandal. At the time, he was formally accused of leaking grand jury information to the media to damage President Clinton and is a darling of the far right of the Republican Party.

"Chevron's use of Hill & Knowlton, Edelman, and a notorious Ken Starr political operative reflect the company's own warped sense of ethics," said Karen Hinton, a spokeswoman for the communities suing the oil giant in Ecuador. "Chevron's lawyers know the evidence has proven the company's guilt, so they now operate in the court of public opinion. The only card they have left is to play a game of smoke and mirrors."

Chevron faces a judgment in Ecuador of up to $27.3 billion based on a 4,000-page environmental damages assessment prepared by a team of 15 court-appointed experts. Most of the scientific evidence in the report comes from an estimated 50,000 chemical samplings results produced by Chevron that document extensive cancer-causing toxins at its own well sites, which were mostly built in the early 1970s.

Chevron is accused in the lawsuit of systematically dumping more than 18 billion gallons of toxic waste into Amazonian waterways from 1964 to 1990, when Texaco (now Chevron) was the exclusive operator of a large oil consortium covering roughly 2,000 square miles in Ecuador's Amazon rainforest. Several independent news organizations, including 60 Minutes and The Washington Post, have recently documented how Texaco left hundreds of oil-filled waste pits that still use pipes to run toxic waste into nearby streams.

Given the quantity of evidence against the company, Chevron has begun to place favorable "news" that can be cited as evidence in court, said Hinton. Most of this "news" is published on the editorial pages of various pro-business newspapers where Chevron advertises, such as the Latin American Business Chronicle and Investor's Business Daily. These outlets write about the Ecuador case using Chevron's talking points without contacting the plaintiffs.

Chevron suffered a major shareholder revolt over the Ecuador liability at its annual meeting in May, while New York Attorney General Andrew Cuomo recently announced he is investigating the company to determine if it is misleading shareholders about Ecuador. Hinton said pressure from shareholders explains why Chevron hired Sard Verbinnen, which boasts on its website that it maintains "close relationships" with financial journalists and institutional investors.

Examples of Chevron's ethically questionable public relations campaign include:

  • In April, Chevron produced a 13-minute video designed to look like an "objective" CNN news report and narrated by former CNN correspondent Gene Randall, but never disclosed it was funded by the company. The tactic was harshly criticized by the Columbia Journalism Review (CJR).
  • The CJR said the Randall video raises "ethical questions" and quotes Norman Solomon, a media critic, as saying "the whole [Randall] effort by Chevron is just another attempt at media spin by a huge corporation with plenty to hide – with the added twist of a hiring a former journalist to implicitly pretend that he's being a journalist while flaking for Chevron to defend the indefensible."
  • Chevron has taken several internet journalists and bloggers on all-expense paid trips to Ecuador in return for favorable coverage on their sites, without disclosing the fact they are paid. The company's lawyers then cite information on the blogs as "evidence" in their court papers. The practice of paying seemingly independent journalists is considered highly unethical.

The trial is taking place in Ecuador at Chevron's request. To avoid trial in the U.S., where the case originally was filed in 1993, Chevron submitted fourteen sworn affidavits to a U.S. federal judge praising the fairness of Ecuador's courts and stipulated it would be bound by any ruling in Ecuador as a condition of the case being transferred there. A final decision on the case is expected in several months.

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