By Adam Klasfeld, Courthouse News
26 October 2015
During secret proceedings in Washington, a key witness in undermining the $9.5 billion judgment Chevron faces in Ecuador repudiated much of his explosive testimony, transcripts made public today show.
Since agreeing to testify for the oil giant, Judge Alberto Guerra's fortunes have changed, and so have Chevron's.
Roughly two years ago, Guerra took to the witness stand in a New York federal courtroom and swore that lawyers for rainforest villagers bribed him to ghostwrite a multibillion-dollar Ecuadorean court judgment against Chevron for oil contamination to the Amazon jungle.
About a year before he made a deal with Chevron, Guerra had little more than $100 to his name. He also owed tens of thousands of dollars in debt and could not afford to visit his children living in the United States.
U.S. District Judge Lewis Kaplan had warned early on in proceedings that he did not "assume that anyone's hands in this are clean," yet he credited Guerra's testimony last year in ruling that the Ecuadoreans obtained their award "by corrupt means."
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.
Kaplan's decision conceded that "Guerra's credibility is not impeccable," but found that his account was "corroborated extensively by independent evidence."
Both that credibility and the corroborating evidence came under withering attack this year during closed-door proceedings before an international arbitration tribunal.
Though the hearings took place without press or public access at the World Bank in Washington on April 23 and 24, the tribunal agreed to release transcripts of the proceedings in response to a Courthouse News request that the Reporters Committee for Freedom of the Press supported.
They show Guerra putting a new twist on an old saying. "Money talks, gold screams," Guerra said in a June 25, 2012, meeting with Chevron representatives - a meeting Chevron recorded.
Testifying about this comment at the arbitration hearing, Guerra said Chevron showed him a safe filled with money. He recounted Chevron's representatives telling him: "Look, look, look what's down there. We have $20,000 there."
He remembered replying: "Oh, OK, very well, very well."
Guerra said he had only $146 in his bank account a year earlier, and owed tens of thousands more to finish the construction of his house. He said he could not scrape money for airfare to visit his children in the United States.
Minutes from Guerra's meeting with Chevron that came to light during the tribunal proceedings showed that Chevron's lawyers hoped to find evidence that the Ecuadorean government had pressured the Guerra to rule against the company.
Guerra disappointed by saying that Ecuadorean President Rafael Correa's administration "never butted in" to the process, the transcript shows.
"These guys are idiots, but the truth, the truth, I attest, damn, they never got involved," Guerra added, referring to Correa's government.
The remark appears to undercut the foundation of Chevron's arbitration case, which asks the tribunal to blame the Ecuadorean government for a miscarriage of justice.
Guerra stood by those comments on the arbitration panel's witness stand.
"My position is that the government did not intervene," Guerra said.
The only time an Ecuadorean government official tried to elbow into the case, Guerra testified, was under a prior administration. Correa's predecessors pushed to dismiss the case in Chevron's favor in 2003, he said.
Guerra also acknowledged bluntly on the witness stand that he had lied in telling Chevron's team that attorneys for the Ecuadoreans offered him $300,000.
"Yes, sir, I lied there," Guerra told Eric Bloom, who represents Ecuador for the firm Winston & Strawn. "I wasn't truthful."
Guerra maintains that other attorneys for the Ecuadoreans, specifically Steven Donziger and Pablo Fajardo, offered money in return for ghostwriting the judgment on behalf of Judge Nicolas Zambrano, the final jurist to preside over the case.
Shifting the details of this supposed arrangement, though, Guerra walked back his allegation that Zambrano offered him 20 percent.
"That was my sworn statement in New York, but what I said is that, because of a circumstance, because of a situation, I mentioned 20 percent when it wasn't true, and I think that, as a gentleman, I should say the truth, and we did not discuss - I did not discuss 20 percent with Mr. Zambrano - but we did discuss that he would share with me from what he received," he said.
In his nearly 500-page ruling, Judge Kaplan pointed to bank records, daily planners, shipping records and airplane tickets as corroborating evidence that outweighed Guerra's credibility problems.
Particularly persuasive for Kaplan was evidence that Ecuador's national airline, Tame, certified delivery of packages between Guerra and Zambrano.
Guerra told the arbitrators this spring, however, that all 11 of these packages "had nothing to do with the [Chevron] case."
As for his plane tickets to the rainforest from Aug. 11 and 12, 2010, Guerra said they occurred during an irrelevant time period.
"If I traveled during those dates, it wasn't for me to provide assistance to the Chevron case," he said.
Guerra testified that Chevron representatives told him that they would have raised his pay if he could provide them with the key physical evidence they were looking for: a draft of the judgment.
"We were unable to find the main document," Guerra recalled them saying. "Had we been able to find it, we would have been able to offer you a larger amount, something like that, we have $18,000 for you, and we're going to take the computer with us."
Though Guerra did not have a copy of the judgment, Ecuador's forensic expert Christopher Racich testified that he found a running draft of the judgment against Chevron on Zambrano's hard drives.
Ecuador now argues that this forensic evidence - which Courthouse News reported exclusively early this year - proves Zambrano painstakingly wrote the ruling and saved it hundreds of times throughout the case.
Chevron has not been able to produce emails between Guerra, Zambrano and the purported ghostwriters, Donziger and Fajardo, Ecuador's forensic expert says.
Guerra acknowledged to the arbitrators that that the bounty of physical evidence he promised Chevron fell short.
There are no calendars and day planners marked with meetings scheduled between Fajardo, Donziger or Guerra, he acknowledged.
While Guerra said he had payments from Zambrano from April 2011 and February 2012, he testified that these "had no connection to the Chevron case."
For Chevron, the thousands of pages of transcripts show that the company "proved its case before the International Arbitration Tribunal."
"Witness and expert testimony confirmed that the Ecuadorean judgment against Chevron was ghostwritten by Steven Donziger and his team and that the Ecuadorian government is responsible for any further remediation," Chevron spokesman Morgan Crinklaw said in a statement. "Chevron also proved that Ecuador breached the U.S.-Ecuador Bilateral Investment Treaty and international law."
Donziger, who still works for the Ecuadorean villagers seeking to collect from Chevron, said in a statement that Guerra's latest testimony "demonstrates once and for all that Chevron's so-called racketeering case has completely fallen apart."
"Guerra has been the linchpin of Chevron's entire body of trumped up evidence and he now stands not only as an admitted liar, but also as a shocking symbol of how Chevron's management has become so obsessed with evading its legal obligations in Ecuador that it is willing to risk presenting false evidence in court to try to frame adversary counsel and undermine the rule of law," Donziger added.