Secret Chevron Arbitration Faces Pressure for Sunlight

By Adam Klasfeld, Courthouse News Service
8 April 2015

The Permanent Court of Arbitration should open up this month's hearings in Washington between Chevron and Ecuador to the news media "in the interests of justice," the Reporters Committee for Freedom of the Press said in a letter today.

Signed by executive director Bruce Brown, the two-page letter "strongly supports" a request by Courthouse News to let the press and public attend the hearings, currently scheduled to take place in Washington between April 20 and May 8.

A three-member tribunal will hear whether to make Ecuador pay for a more than $9 billion verdict its judiciary reached against Chevron four years ago, for oil contamination to the Amazon rainforest.

Chevron and its predecessor Texaco have attacked the judgment – which stemmed from a lawsuit that has spanned three continents and over two decades – as a "shakedown" that should never have been heard under the terms of a disputed-investment treaty.

Ecuadorean President Rafael Correa has publicly commented that Chevron's arbitration could "bankrupt" his government – based on false accusations – and leave the oil giant off the hook for decades of Texaco's drilling in jungle lands.

On Monday, Courthouse News formally filed a letter seeking access to the upcoming arbitration hearings.

The Reporters Committee backed that request in a strongly worded letter pushing for transparency "in the interests of justice, due to the immense public interest in this case and the unique circumstances of this dispute."

"Openness of judicial or quasi-judicial proceedings is vital to the legitimacy of the rule of law and gives assurance that proceedings are being conducted fairly," the letter states. "Public access to proceedings helps guard against corruption, the appearance of corruption, and decisions based on bias or partiality. Because of the high stakes in this case for the nation of Ecuador and the Chevron Corporation, secrecy will only breed distrust among the public."

The media advocacy group noted that Chevron's litigation in the Ecuadorean city of Lago Agrio is "one of the most highly publicized and most contentious environmental lawsuits in history."

"The case involves thousands of Ecuadorians, claims of environmental destruction of the Amazon rainforest, a multibillion-dollar judgment against one of the largest companies in the world, and allegations of extortion and public corruption," the letter states. "Citizens around the globe have a continued interest in the outcome of this dispute."

The letter is addressed to a deputy secretary general and senior legal counsel for the Permanent Court of Arbritration, based in The Hague, Netherlands.

Roughly two years ago, PCA's secretary-general Hugo Siblesz commented in a speech that its tribunals have a "mixed" record of providing transparency, ranging from "webcasting" proceedings to keeping "even the existence of an arbitration in the strictest confidence."

Chevron's arbitration with Ecuador has taken the form of closed-door proceedings, with at least one development only coming to light through an unauthorized disclosure.

The Reporters Committee wrote that this arbitration deserves public airing particularly because of "urgent legal questions about the interplay of arbitration proceedings pursuant to international treaties and the courts of sovereign nations."

"Because arbitration is an increasingly popular method of dispute resolution, journalists, legal scholars, and the public have a particular interest in the effect arbitration can have on the rulings of the highest courts in countries around the globe," the letter states.

"The public will be best served by being able to observe the upcoming arbitration proceedings," the group adds.

The PCA, its panelists and lawyers for the parties have not yet responded to the pending request for press access.

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