Amazon Judge's Data Secretly Scanned in $9.8B Chevron Fight

"It was a huge gamble and it did not pay off for [Chevron]. The hard drives prove what [Ecuador] has insisted all along: Judge Zambrano wrote the Lago Agrio judgment, and nothing Guerra says can be believed."

By Adam Klasfeld, Courthouse News Service
27 February 2015

Beneath the redactions of a legal brief before a tribunal in the Netherlands, lawyers for the Ecuadorean government unveiled a new piece of evidence to support their citizens' embattled $9.8 billion environmental judgment against Chevron.

Provided exclusively to Courthouse News, the leaked text describes a still-secret forensic report analyzing the computer hard drives of Ecuadorean Nicolas Judge Zambrano, who issued a verdict in Lago Agrio finding Chevron liable for oil devastation to the Amazon jungle.

It has been nearly a year since New York's U.S. District Judge Lewis Kaplan found that the judgment had been "procured by corrupt means."

Kaplan had based his finding largely on allegations by Zambrano's predecessor Alberto Guerra, the first Ecuadorean judge to hear the Chevron case.

Now a key Chevron witness, Guerra testified that the Ecuadorean's lead attorney Steven Donziger and his colleagues promised him a $500,000 cut of the potential award to ghostwrite the judgment for Zambrano.

The Ecuadoreans have long attacked Guerra, who has a contract with Chevron for various perks, including at least $326,000, an immigration attorney and a car, as a "paid-for" participant in the oil giant's self-styled witness-protection program.

While noting that "Guerra's credibility is not impeccable," Kaplan wrote that his account was "corroborated extensively by independent evidence."

The evidence hunt meanwhile labors on before an arbitration tribunal in The Hague that is considering Chevron's claims against the Ecuadorean government for allegedly supporting the fraud against it.

The Latin American nation's Nov. 7, 2014, legal brief shows that the tribunal granted Chevron permission to search two of Zambrano's judicial computers, over Ecuador's "vociferous objection."

"It was a huge gamble and it did not pay off for [Chevron]," an unredacted version of that brief continues. "The hard drives prove what [Ecuador] has insisted all along: Judge Zambrano wrote the Lago Agrio judgment, and nothing Guerra says can be believed."

The brief contrasts Guerra's testimony with the summarized findings of Christopher Racich, the founder of the Vienna, Va.-based forensic consultant Vestigant, whose website boasts a clientele of "Fortune 500 companies, law firms, individuals and government agencies."

"It is hard evidence, not self-serving testimony, that carries the most weight," the brief states.

Guerra told the New York court that he cribbed and then edited a draft of the final judgment by attorney Pablo Fajardo, who argued the case in Ecuador for residents of Lago Agrio, where Chevron's predecessor Texaco drilled between 1972 and 1992.

"But there is absolutely no forensic evidence in respect to either Mr. Guerra's or Judge Zambrano's hard drives that offers any hint that Mr. Guerra actually drafted or edited even a single sentence of any of these orders," the unredacted brief states. "Nothing."

While Guerra testified that he transferred the ghostwritten judgment onto Zambrano's computer through a flash drive, Racich found no metadata indicating that any Ecuadorean court document entered either of Zambrano's hard drives through a USB port, the brief says.

Racich found that the file was created when Zambrano resumed jurisdiction over the case in October 2010, according to the brief.

Both Chevron's expert and Racich "agree that a file containing several progressive drafts of the judgment was created on Judge Zambrano's computer in October 2010," according to the brief. "The document was saved and edited hundreds of times on Judge Zambrano's computer."

The Microsoft Word document that became the judgment "contained appropriately increasing amounts of judgment text over the four-month period" between Zambrano's hearing the case to his issuance of the judgment, the brief states.

Racich's other findings supported Zambrano's testimony in New York, where the Ecuadorean judge strained to remember details of his 188-page judgment.

Chevron's spokesman Morgan Crinklaw said in an email that Zambrano's poor performance on the witness stand undermined the judgment.

"Judge Zambrano did not write the Ecuadorian judgment against Chevron," Crinklaw said. "This fact was confirmed when he could not answer basic questions about it when he testified under oath in a U.S. federal court."

On the stand, Zambrano could not recall what his judgment called "statistical data of highest importance in delivering this ruling" - a study by Miguel San Sebastian or the English abbreviation for the mixture of hydrocarbons in crude oil (TPH).

At the time, lawyers for the Ecuadoreans decried Chevron for using "poor translation and semantics" to get "misleading 'gotcha' moments" in court.

For example, the Spanish translation for total petroleum hydrocarbons is HTP, Ecuador's lawyers noted in their brief.

Acknowledging Zambrano's "evident lack of preparation," Ecuador's lawyers contend Racich's report supports his testimony that his teenage assistant performed extensive legal research online.

Zambrano's computer showed searches for the citations on Google, Bing, Lexis Ecuador, Cervantes Virtual Library and, an Ecuadorean legal database likened to Westlaw.

Citing the confidentiality of his work, Racich declined to comment over the phone about the report, which remains sealed before The Hague's arbitration tribunal.

Courthouse News received the text of the still-confidential brief from a source who obtained it from a contact inside Ecuador's attorney general's office. Both wanted to remain anonymous in light of the tribunal's confidentiality order.

Ecuador's Attorney General Diego Garcia and Chevron's lawyer Ted Olson have meanwhile received letters over the past month from Donziger, the Ecuadoreans' lead attorney, demanding the release of the report.

Donziger's Feb. 9 letter to Chevron's lawyers reminds them that their "ethical duties commit [them] to a continuing duty of candor" to provide exculpatory evidence.

Chevron spokesman Crinklaw pointed out that multiple forensic studies of Zambrano's hard drives have been submitted to The Hague.

"This report is one of several that have been submitted to the International Arbitration Tribunal, all of which have been kept confidential at the republic of Ecuador's request," Crinklaw said in an email. "Chevron is not going to comment on these reports, certainly not one that has been taken out of context in isolation."

Crinklaw noted that Chevron's expert in the New York trial found similarities in internal files from the Ecuadoreans to that of the final judgment.

"Donziger and his few remaining supporters have yet to explain the evidence that proves they ghostwrote the judgment, including how their internal work product was found word-for-word, typos and all, in the decision," Crinklaw said.

Ecuador's lawyers countered in their brief that Chevron's "near-limitless access" to their adversaries' files "uncovered no draft of the judgment, nor any suggestion that [their] attorneys' ever prepared one."

While Chevron declined to reveal what their expert at The Hague said, Ecuador's legal brief maintains that Chevron's competing analysis argued only that the computer analysis revealed inconsistencies within Zambrano's testimony. The analysis never contradicted Racich's findings, according to the brief.

The brief also sidelines a purported claim by Chevron's expert to have found signs of document destruction when Zambrano copied files between his new and old computers. Racich found that this was "almost definitely associated with normal computer use," according to the brief.

"In light of the competing forensic expert reports," Ecuador asked the tribunal to allow its appointee to investigate the hard drives further, the brief states.

Donziger's appellate attorney Deepak Gupta said he would consider all options that the report presents, including bringing it to the attention to the judges at the 2nd Circuit, which recently scheduled the appeal of Kaplan's ruling for April 20.

"This latest development shows that the facts are anything but settled - and underscores why American courts are ill-equipped to inject themselves into litigation thousands of miles from our shores," Gupta said in an email.

Since the Racich report never entered the New York record, one avenue for submitted the evidence would be seeking judicial notice. The Ecuadorean government recently used this maneuver to bring new environmental evidence to the court's attention.

The report could also help the Ecuadoreans in Canada, Brazil and Argentina, where they are seeking to collect Chevron's assets, Donziger's spokeswoman Karen Hinton said.

Meanwhile, observers of the case noted that New York appeal may come down more to the law than analysis of the facts of the case.

In early 2012, the 2nd Circuit dissolved what it called a "radical" injunction blocking collection of the judgment anywhere in the globe. Kaplan had no authority to dictate the actions of other courts, the panel found.

Kaplan's new order does not prevent other judiciaries from enforcing the judgment, but blocks the attorneys for the Ecuadoreans named in the lawsuit from collecting any fee from it.

Gupta predicted that this too would be considered an overreach.

"The bottom line is that a federal trial judge in New York doesn't have a roving power to sit in judgment of another nation's courts," Gupta said. "Now there's further reason to believe that the trial court's decision was flawed not just legally but factually as well."

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