Lawyers for Ecuadorian plaintiffs from an Amazon village are appealing a 2014 ruling in favor of Chevron
By Kaelyn Forde and Paul Beban, Al Jazeera America
23 April 2015
A decades-long legal battle between villagers in the Ecuadorian Amazon and Chevron Corporation over widespread pollution in the rainforest could face further legal rounds, a U.S. federal appeals judge suggested this week.
From 1964 to 1992, a Texaco-led consortium drilled for oil in the Amazon, spilling thousands of barrels of oil and billions of gallons of toxic wastewater, Ecuadorian villagers claim. Chevron, which bought Texaco in 2001, was ordered to pay $9.5 billion in 2013 by Ecuador's Supreme Court but maintains that the verdict was the product of fraud.
The case currently before federal judges in Manhattan, however, is not about whether Texaco polluted the Amazon. It's an appeal by Steven Donziger, the Ecuadorian plaintiffs' longtime attorney, against claims that the victory in Ecuador was "procured by fraud."
On Monday, Chevron attorneys urged the 2nd U.S. Circuit Court of Appeals in Manhattan to uphold a 2014 ruling finding that Donziger used "corrupt means" to secure the $9.5 billion judgment.
"What happened here was a fraud on the Ecuadorian courts," said Theodore Olson, an attorney for Chevron.
In a further twist to the long-running dispute, judge Richard Wesley asked attorneys for both sides whether they would support a retrial in the United States of the Ecuadorian ruling. That raises the prospect of yet more court battles ahead and further delays to litigation that already spans more than two decades.
Paul Paz y Miño, Director of Outreach and Online Strategy at Amazon Watch, an environmental advocacy group, said he worries that the longer the court battle lasts, the greater the cost to the victims.
"Caught in the middle and still standing there waiting for someone to come clean up the toxic waste are the 30,000 people affected in Ecuador," he said, adding that 1,400 people have already died from cancer. "The estimate is 10,000 people are going to get cancer because of what Texaco [which Chevron bought] did. So they stand there, and for them, justice delayed is completely justice denied. Some have spent a whole lifetime waiting on this case."
The original case centers on the Lago Agrio region of Ecuador, a part of the Amazonian rainforest roughly the size of Rhode Island that villagers claim was polluted with thousands of barrels of oil and billions of gallons of toxic wastewater. Chevron purchased Texaco in 2001 and assumed all of its liabilities. In 2013, Ecuador's Supreme Court upheld a lower court's ruling and ordered Chevron to pay the $9.5 billion judgment. But Chevron maintains that the Ecuadorian court's verdict is the product of fraud and has refused to pay, a claim the plaintiffs, their attorneys and human rights groups deny.
"Chevron claims that the Ecuadorians and their lawyers fabricated a case against them, and the sites they claim to have remediated are now clean. But anyone can go to Ecuador today and see the contamination is still there," said Paz y Mino. "This is 18 billion gallons of toxic waste. It's hard to picture that much, but it is way bigger than the Exxon Valdez spill or the BP oil spill – and this was deliberately done over decades."
In 2014, U.S. federal judge Lewis Kaplan ruled that Donziger and his colleagues had used "corrupt means" in their case against Chevron. And while Kaplan's ruling in favor of Chevron did not overturn the Ecuadorian court's decision, it currently prevents the Ecuadorian plaintiffs from using U.S. courts to collect the $9.5 billion judgment from the California-based oil company. Additional litigation by Ecuadorian plaintiffs is pending in Canada and Brazil, where Chevron also has assets, attorneys said.
Donziger says he is confident Wesley and the other judges will overturn Kaplan's ruling on appeal. He called the 500-page ruling against him – which stated that he submitted fraudulent evidence, coerced a judge and paid a consulting firm to "ghost-write" a court-appointed expert's report – an intimidation tactic.
"We had our trial on the merits. It lasted 11 years: eight years in trial, three years in appellate proceedings," Donziger said. "It's over. The villagers have won the case. This case is over. The only thing left to do – because they don't want to pay the judgment – is to collect the judgment. And we are not going to get distracted by what is essentially a sideshow, and that is their constant attacks on lawyers."
Donziger's attorney, Deepak Gupta, said retrying the case in U.S. courts would set a dangerous precedent.
"It's not a realistic option. There already has been a trial, and that trial took more than 10 years and consisted of many judicial inspections of the sites," Gupta said. "So the idea of an American court two decades later trying to decide an environmental case under Ecuadorian law is fanciful. They have to write an opinion and set some law here, and it can't be that anyone who loses a case anywhere else in the world can come to New York and get a do-over."
But Burt Neuborne, an attorney representing two Ecuadorian plaintiffs, Hugo Gerardo Camacho Naranjo and Javier Piaguaje Payaguaje, said he would "absolutely be in favor" of a retrial.
"I have asked the court to separate the fate of the lawyers from the fate of the victims, and that's what most of my argument was premised on during Monday's hearing," Neuborne said. "I agreed to step into this case a year ago, and it was clear to me Chevron had successfully diverted everyone's attention from their responsibility to remediate the land, to essentially a distasteful horror story over how badly the lawyers behaved."
Chevron's attorney, Theodore Olson, declined to be interviewed by Al Jazeera America as he left the courthouse on Monday. When asked if Chevron intended to make good on the $9.5 billion judgment, Olson replied: "Very good. Nice try." Neither Olson nor Chevron returned Al Jazeera America's calls for further comment.
About 30,000 Ecuadorian villagers living in the Lago Agrio region have claimed that the contamination from Texaco's waste has caused health problems, including cancer, and led to premature deaths.
Chevron has insisted that a $40 million cleanup by Texaco and an agreement Texaco signed with the government of Ecuador in 1998 have absolved Chevron of further liability. But Amazon Watch said it has spent more than a decade accompanying Amazonian communities that are still fighting for a full cleanup.
"The people of Ecuador are still drinking this contaminated water, and they don't have any other choice. They're bathing in it; they are washing their clothes in it. And they have been waiting a lifetime at this point for someone to come and clean it up. And now, Chevron points the finger back at them and says they're the ones who are responsible for fraud," said Paz y Miño. "Everyone knows the emperor has no clothes here, but Chevron is clinging to that defense."
Last week, Amazon Watch released videos it says were leaked to them by a whistleblower at Chevron. One video, which Amazon Watch said was filmed at the Shushufindi 21 site, a former Texaco well in the Lago Agrio region, purportedly shows employees and paid consultants finding contamination in 2005 and 2006 at sites Chevron claimed had been cleaned up years ago, and laughing about it.
According to Amazon Watch, the recordings arrived on DVDs at the nonprofit's office in 2011 with no return address and a note that read, "I hope this is useful for you in the trial against Texaco/Chevron. [Signed] A friend from Chevron."
Chevron does not deny the videos belong to the company, but a spokesman for Chevron told Al Jazeera America that the videos have been taken out of context.
"These edited video clips demonstrate the process used to identify the perimeters of pits at oil field sites, which is standard practice in environmental testing," wrote Morgan Crinklaw, a spokesman in Chevron's policy, government and public affairs division, in an email. "A variety of samples were taken inside and outside the pits to determine their borders. There was nothing ‘secret' about this process, and pre-inspection sampling was performed by the plaintiffs as well."
Chevron's spokesman added that it is not possible to know which locations are being tested in the videos. Texaco's consortium also included the state-owned oil company, Petroecuador.
"[T]hese edited clips do not indicate what site was being tested or whether the site was the responsibility of Texaco or Petroecuador, the state-owned oil company," wrote Crinklaw. "The judgment against Chevron in Ecuador has been found by a U.S. federal court to be the product of fraud. If there was evidence to support their claims against Chevron, the plaintiffs and their lawyers would not have had to resort to bribery, extortion, ghostwriting and other corrupt means."