$16 Billion Chevron Liability Could Rise If Groundwater and Surface Water Damage Included, Plaintiffs Say
New Criminal Indictment of Chevron Lawyers
Amazon Defense Coalition
16 September 2008 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109
QUITO, Ecuador (BUSINESS WIRE) - An independent court-appointed expert in the environmental trial against Chevron in Ecuador should impose additional damages on the oil giant for groundwater and surface water contamination that could significantly increase the current $16.3 billion liability estimate, lawyers for the plaintiffs say.
In a response to the expert's 4,000-page report, the plaintiffs today submitted papers to the court asking the expert to calculate how much it would cost to remediate the damage to groundwater and surface water, both of which were not included in the expert's assessment. The surface water contamination comes from Chevron's deliberate discharge of 18.5 billion gallons of toxic "produced water" into the Amazon from 1964 to 1990, when it was the exclusive operator of an oil concession that covered an area the size of Rhode Island.
"There is significant evidence of groundwater and surface water contamination in the record, yet there are no damages imposed to remediate the impacts," said Pablo Fajardo, the Ecuadorian lawyer for dozens of Amazon communities and five indigenous groups who are suing Chevron.
Fajardo said it was up to the expert to calculate the amount of the additional damages, but he estimated the number could be significant if the expert accepts the request. An earlier assessment by a plaintiff's expert had estimated groundwater clean-up alone at more than $2 billion.
A final decision in the case, which Chevron has fought for years to delay since it was filed in 1993 in U.S. federal court, is expected in the coming months. If the Ecuador court expert's damage assessment is accepted by the judge, Chevron could be hit with the largest environmental damages claim in history-not unexpected, according to the plaintiffs, given that scientists believe the magnitude of damages is the largest ever for an oil-related contamination.
In any event, any Ecuador judgment likely will be enforceable in the U.S. because Chevron voluntarily submitted to jurisdiction there as a condition of having the case transferred to Ecuador in 2002. At the time, Chevron submitted ten sworn affidavits from legal experts praising Ecuador's courts as transparent and fair.
The plaintiff's response to the expert report is based on a technical review by over a dozen prominent scientists from the U.S., Ecuador, and Spain. In additional, Richard Cabrera, the court-appointed expert, worked with a team of 14 scientists who reviewed roughly 64,000 chemical sampling results and more than 200,000 pages of trial evidence, and conducted their own field analyses.
In all, more than 25 scientists - most from the U.S. or Ecuador - were involved in either preparing the Cabrera report or reviewing it.
In its response, the plaintiffs made the following points:
- The overall damages assessment, once the excluded categories are included, is a reasonable amount and consistent with damages imposed in other large environmental disasters around the world. Several examples were cited.
- The report underestimated the number of deaths from cancer due to the oil contamination by failing to take into account population growth in the region. Cabrera estimated 428 excess cancer deaths due to oil contamination, while the plaintiffs believe the number of cancer deaths could be at least three times that high if current population data is used.
- An amount for "unjust enrichment" - $8.3 billion - should be added to actual damages because it is simply impossible, from a clean-up standpoint, to restore the rainforest to its original condition given the extent of the damages. That amount raises the total damages award to $16.3 billion plus the additional categories, said Fajardo.
The Cabrera report, released last March, estimated Chevron's damages in the long-running trial between $7.2 billion and $16.3 billion. The lower number covers actual damages, which includes soil cleanup, a water system to provide clean water, health care services, compensation for cancer deaths, and the buying back of ancestral land of indigenous groups.
The higher number - called "unjust enrichment" - includes $8.3 billion for the disgorgement of monies Chevron saved by using sub-standard production practices that violated Ecuadorian law and industry custom. At the time Chevron began operating in Ecuador, for example, it was customary to re-inject the formation waters into the ground instead of dumping them where they could poison fresh water sources.
Lawyers for the plaintiffs also blasted Chevron for using "junk science" in its own rebuttal. Chevron claimed Cabrera used "fabricated" evidence to reach "erroneous" conclusions.
In fact, most of the scientific evidence used by Cabrera was provided by Chevron itself.
"Chevron has been trying for years to deceive the court by manipulating its interpretation of lab results for litigation purposes," said Fajardo. "The company has never even funded a health evaluation after more than four decades of contaminating the rainforest, but it spends millions to attack those like us who dare to try to hold the company accountable."
"There is no court in the world that is good enough for Chevron if that court acts independently," he added.
Cabrera was paid by Chevron in an earlier part of the trial when he served as a court-appointed expert for a judicial inspection. Chevron did not object to his qualifications at the time.
The court submission comes just days after two Chevron lawyers, including a high-level executive based in Miami, were indicted in Ecuador on fraud charges for allegedly lying about the results of a purported remediation of the contamination. The lawyers, Ricardo Reis Veiga and Rodrigo Perez Pallares, are continuing to supervise Chevron's defense in the civil trial.
About the Amazon Defense Coalition
The Amazon Defense Coalition represents dozens of rainforest communities and five indigenous groups that inhabit Ecuador's Northern Amazon region. The mission of the Coalition is to protect the environment and secure social justice through grass roots organizing, political advocacy, and litigation.