Gowen Group Law Office
13 June 2014 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109
Quito, Ecuador – Leaders of the Ecuadorian rainforest communities who won a $9.5 billion environmental judgment against Chevron have terminated a fee award to the American law firm Patton Boggs because it prejudiced its former clients and agreed to turn over confidential client information to the oil company.
Under terms of the Patton Boggs retainer agreement with the Ecuadorian communities – whom it represented against Chevron since 2010 until withdrawing on May 7 – the law firm was entitled to roughly 5% of any gross recovery in the case. That interest no long exists even though Patton Boggs had promised to assign it to Chevron as part of its controversial settlement agreement with the company, said Pablo Fajardo the lead Ecuadorian lawyer for the communities.
"The communities have exercised their right to terminate the fee agreement with Patton Boggs in light of the firm's withdrawal from the case and its unfortunate betrayal of its clients in Ecuador," said Fajardo, the winner of the prestigious Goldman Environmental Prize.
"The Patton Boggs fee is now in the hands of the affected communities and it will be used to clean up Chevron's contamination of our lands and waters once a recovery occurs," added Fajardo. "This move is not only fair and just in light of the circumstances, but it ensures that Chevron will never benefit from its misconduct by taking control of the Patton Boggs fee."
In a letter sent to Patton Boggs Managing Partner Edward Newberry, representatives of the communities said that by terminating its retainer Patton Boggs has given up any "right, claim, title, or interest" in its fee.
"It should be clear that Patton Boggs has no remaining interest in the Aguinda v. Chevron judgment or related litigation to assign to Chevron or anyone else," said the letter, which is available here. The letter also criticized the firm for refusing to send a notice of its withdrawal in writing and for ignoring previous correspondence from the villagers.
Fajardo said the rainforest communities are continuing to insist that Patton Boggs scuttle its settlement agreement with Chevron until certain provisions can be re-negotiated to conform to the ethical rules, as expressed in this letter and this legal motion currently pending in federal court.
The communities also have threatened to sue the law firm (now known as Squire Patton Boggs after a recent merger) for damages if it does not cure the ethical violations in its settlement agreement, according to this letter sent to the firm's management committee.
In its agreement with Chevron, Patton Boggs promised to turn over its entire fee interest to the oil company as well confidential and privileged client information. The firm then imposed on the villagers the burden of procuring new counsel to protect their privileges in light of the violations that Patton Boggs promised Chevron it would committ as part of its agreement with the company.
The Ecuadorian communities have accused Chevron and its main law firm, Gibson Dunn & Crutcher, of using intimidation tactics to drive lawyers and consultants such as Patton Boggs away from their case so that the villagers will be left defenseless. A Patton Boggs team led by partner James Tyrell scored a number of important victories over Chevron in U.S. appellate courts, provoking the company's ire and prompting the oil giant to retaliate by suing the law firm.
"Chevron knows it has lost the Ecuador case on the evidence, so it is going after the lawyers to try to win by might what it cannot win by merit," said Fajardo. "Patton Boggs is just the latest target."
The $9.5 billion Ecuador judgment against Chevron – which issued in February 2011 – was affirmed unanimously by two separate appellate courts, including Ecuador's highest court, The National Court of Justice. Because Chevron refuses to pay the judgment, the villagers have filed judgment enforcement actions to seize Chevron assets in Canada, Brazil and Argentina.
The Ecuadorians are represented by separate counsel in the enforcement jurisdictions. In Canada alone, where the case will be heard by that country's Supreme Court in November, Chevron has roughly $15 billion in assets.
The villagers also blasted U.S. federal judge Lewis A. Kaplan, who ruled in March in a non-jury trial that the Ecuador judgment was procured by fraud even though Chevron's numerous complaints about the trial process already had been litigated and rejected in Ecuador. Kaplan, a pro-corporate jurist who has long been accused of bias against the Ecuadorians, based his ruling on the testimony of an admittedly corrupt former Ecuadorian judge who was given upwards of $1 million by Chevron and who repeatedly changed his story as forensic evidence disproved earlier versions.
For background on the overwhelming evidence against Chevron in the underlying pollution case, see this document; for evidence of Chevron's human rights violations, see this video; and for independent confirmation of the pollution, see this 60 Minutes segment.
For background on how Chevron made a mockery of justice in U.S. courts and how the company's RICO decision will backfire against it in international courts, see here.