Ecuadoreans Blast "Secret" Hague Tribunal Convened for Chevron

By Adam Klasfeld, Courthouse News Service
10 February 2012

New York, NY – A group of Ecuadoreans have taken the offensive against a Hague arbitration panel that they claim will meet in secret, without transparency or accountability, this weekend to determine the fate of an $18.2 billion environmental judgment they won against Chevron.

After failing to block the judgment in the United States and Ecuador, Chevron hopes The Hague will prove more sympathetic. The oil giant claims the award violates the terms of a $40 million settlement it reached with the government of Ecuador in 1995.

Calling themselves "Los Afectados" (The Affected Ones), the Ecuadoreans have called the 1995 cleanup a "sham" that did little to repair the environmental and health fallout from the Amazon's so-called Chernobyl.

Courts in the United States and Ecuador have also rejected Chevron's argument, finding that the 1995 agreement did not extend to the nation's citizens.

Exactly one year ago, however, the Hague tribunal passed an Interim Measures Order that told Ecuador to block its courts from enforcing the judgment.

Ecuador complained that the order flies in the face of its constitution, which enshrines a separation of powers.

Chevron expects the panel to chastise Ecuador for noncompliance this weekend in Washington, D.C.

"The tribunal has scheduled a hearing in Washington this weekend to address Ecuador's failure and refusal to comply with the tribunal's Interim Measures Order directing Ecuador to take all measures at its disposal to prevent enforcement of the Lago Agrio judgment, which the tribunal recently converted into an even more powerful interim award," Chevron spokesman Kent Robertson said in an email. "The hearing this weekend is a result of court activity in Ecuador that is extending the fraud the Lago Agrio plaintiffs' lawyers have perpetrated."

Rejecting Chevron's fraud claims as a distraction, the Ecuadoreans complain that the tribunal will meet in a closed-door, "secret club" hearing, foreclosing public access, press scrutiny or an avenue to appeal.

During a telephone press conference, Public Citizen's Global Trade Watch director Lori Wallach blasted the tribunal as a "kangaroo court" comprised of handsomely paid trade lawyers instead of judges.

Quoting a speech trade lawyer Gary Horlick gave to the National Press Club on Jan. 26, Wallach said arbitral tribunals are "Big Business" whose panelists earn about $3 million in legal fees.

The high paychecks allegedly give panelists incentive to claim jurisdiction.

"It's like ordering a person found innocent to be executed by firing squad and making money off the bullets," Wallach said.

The arbitrators sitting on the Chevron v. Ecuador panel are V. V. Veeder of Essex Court Chambers; Vaughan Lowe, a professor at All Souls College; and Horacio Grigera Naón, a director for the Center on International Commercial Arbitration at American University's Washington College of Law.

On Wednesday, Wallach co-signed a letter - with officials from the Rainforest Action Network and Amazon Watch - calling on the panelists to disclose what they expect to earn on the case and any ties they may have with Chevron or their lawyers.

"We are representatives of civil-society organizations that have worked to educate the public and policymakers about the ways in which the non-transparent, unaccountable investor-state arbitration dispute resolution system - which was designed to adjudicate compensation for government expropriation of foreign investors' property - increasingly is being abused by corporations to undermine fundamental human rights and to evade public-interest regulation and accountability," the letter begins.

"You currently sit as arbitrators in one such case, Chevron Corp. v. Republic of Ecuador, which concerns the historic environmental lawsuit in which more than 30,000 indigenous and other residents of the Ecuadorian Amazon are trying to make Chevron clean up the massive oil contamination at its [predecessor Texaco's] former operations sites. Your arbitration could have a significant impact on whether these people will ever see a meaningful cleanup of their lands and on their fundamental rights to life, health, and judicial protection (specifically, determination of their claims and enforcement of any remedies ordered by the court)." (Brackets added)

Robertson did not reply to questions about the Ecuadoreans' criticisms of the panel's structure or possible ties to Chevron, except to say "the plaintiffs' lawyers and their paid surrogates continue to out-do themselves."

Thursday morning, Pablo Fajardo and Aaron Page, attorneys for Los Afectados, sent another 10-page appeal to the Inter-American Court of Human Rights, asking executive secretary Santiago Canton to block the relief that Chevron is seeking at The Hague.

"Chevron wants the republic to mandate, or otherwise effect through political pressure, that the historic case be shut down or suspended," the letter states. "For the republic to allow, much less instigate, any delay in the implementation of the lawfully determined and ordered remedy that the Afectados have achieved in Ecuadorian courts would be a flagrant violation of Ecuador's binding commitments under the American Convention and the San Salvador Protocol - and would simply be unconscionable in light of the fact that the Afectados suffer the effects of Chevron's contamination on their lives and health every single day."

Supporters of the Ecuadoreans will rally today (Friday) at noon, but they will not be able to enter the hearing that begins on Saturday.