Company also hid dirty samples from Court; New boost to villagers as they seek Chevron assets
18 June 2014 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109
New York, NY – A new report prepared by a team of prominent American scientists after the end of the Lago Agrio trial found that Chevron caused "widespread" toxic contamination to indigenous ancestral lands in Ecuador's rainforest that persists to this day, directly contradicting the company's defense in the Ecuador environmental litigation and providing a new boost to efforts by villagers to seize Chevron's assets abroad.
The report – published by the Louis Berger Group (LBG), a consultancy that has worked for several U.S. government agencies – also found that Chevron engaged in an elaborate cover-up to hide the information from the Ecuador court during the Lago Agrio trial, which lasted from 2003 to 2011. The report has the potential to shake up the long-running case in favor of the rainforest villagers as they pursue Chevron's assets in Canada, Brazil and Argentina to pay for a clean-up.
The LBG scientists who wrote the report spent several weeks in Ecuador in 2013 to inspect 18 of Chevron's former well sites, which are spread out over a 1,500 sq. mile area of rainforest just south of the Columbia border. The report was prepared at the request of the American law firm Winston & Strawn for a private international arbitration where Chevron is seeking – thus far without success – to shift the clean-up liability to Ecuador's government.
The LBG scientists chose the sites based on a representative sampling of the estimated 375 polluted wells and production facilities built and operated by Chevron's predecessor company Texaco between 1964 and 1992. Many of the same sites also were inspected by the Ecuador court during the Lago Agrio trial, which resulted in a finding of liability against Chevron for deliberately discharging billions of gallons of scalding, toxic-laced production water into rainforest waterways and abandoning hundreds of unlined waste pits which contain cancer-causing hydrocarbons.
The findings of the LBG report essentially confirm the findings of the Ecuador trial court that Chevron is responsible for widespread pollution, as follows:
- At well sites in Ecuador that had been operated only by Chevron and closed before the company left in Ecuador 1992, LBG's scientists found extensive pollution that still – more than two decades after Texaco left Ecuador – poses a significantly increased risk to the local population of cancer and other oil-related health problems, such as immune system deficiencies and spontaneous abortions.
- Based on a separate review of the scientific data submitted to Ecuador's courts by Chevron and the villagers, the LBG group concluded that the oil company's own evidence proved the case against itself by documenting extensive levels of pollution at sites that only the company operated – even though Chevron's lawyers tried desperately to hide some of its own damning sampling results from the court. The review included more than 64,000 chemical sampling results considered by the court.
- The LBG scientists found illegal levels of toxins – including Total Petroleum Hydrocarbons, heavy metals, and brine – in soil, sediment, and surface water at each of the Chevron sites tested. They concluded that their results were consistent with high levels of pollution found by Chevron in its secret "pre-inspection" sampling that the company hid from the Ecuador court. (LBG managed to access Chevron's secret pre-inspections data through independent discovery litigation in U.S. federal courts related to the international arbitration dispute. The villagers were not a party to those litigations and thus did not have access to any of the new data until Ecuador's government made a portion of it available to the general public.)
- The team also found that Chevron had installed gooseneck pipes in the sides of its waste pits that "continue to this day to allow contamination to flow out of pits and away from sites"; and that LBG's sampling demonstrates that "contamination flowed vertically down to the water table and then emerged in springs or the sides of streams" that the local population relies on for its drinking water.
In sum, the team found that Texaco violated Ecuadorian law, generally-accepted international standards in place during the time it operated, and its own contract with Ecuador's government that required it to not pollute the environment. Notably, none of the extensive evidence of environmental contamination confirmed by LBG and considered by the Ecuador court was reviewed by New York Judge Lewis A. Kaplan when he found in Chevron's favor in a deeply flawed RICO trial against the villagers that concluded this year.
The LBG report also found that during the Lago Agrio trial Chevron artificially lowered toxic levels it reported to the court by deliberately using a flawed test that severely underestimated oilfield contamination. It also employed "composite sampling" where dirty soil samples from well sites were mixed with clean samples from the nearby forest to lessen the apparent impact. The villagers have called such methods "junk science" and long asserted they are part of an elaborate hoax designed by Chevron scientists, led by Sarah McMillan and John Conner, to deceive courts around the world.
"The weight of the evidence is overwhelming," said a summary of the report submitted by Winston & Strawn to the international arbitration panel, available here. "[Chevron's] contamination has caused and continues to cause massive human health and environmental impacts" severe enough to easily justify the $9.5 billion damages award, according to the legal brief.
The human health impacts of the pollution, which has lasted for almost one half-century in an area that is home to numerous indigenous tribes, were also a subject of the LBG inquiry. Scientists from the group reported observing children and others playing and bathing in streams clearly contaminated with oil. One of the experts used by LBG, Dr. Phillippe Grandjean, concluded based on various independent studies that cancer rates in the area where Chevron operated were high – including up to 47 times higher than the norm.
"The human health impact from the contamination is significant," said the summary. "As a result of [Chevron's] contamination, anyone who lived at this site in the past, who lives there currently, or who may live there in the future will faced significantly increased risk of cancer" and other oil-related health problems such as impaired kidney and liver function, a weakening of the central nervous system, reduced immune function and increased risk of spontaneous miscarriages.
Previously, expert evidence submitted by Dr. Daniel Rourke (formerly of the RAND corporation) in the Ecuador trial found that upwards of 10,000 people in the region will contract cancer in the coming years even assuming a comprehensive clean-up in the near term. This is partly due to the long latency period for cancer, which often is two to three decades or longer.
Notably, the summary of the LBG report made available to the public is partially redacted because Chevron succeeded in convincing various courts to seal embarrassing information that it found dirty soil samples during the "pre-inspections" process. See this Huffington Post report that calls on the company to release the information, saying U.S. courts should not help an oil company block the release of internal reports pointing to its own corruption.
The significance of the LBG report – even in its redacted form – can hardly be overstated.
The Ecuadorian villagers say they will use it in foreign courts to defeat Chevron's claims the judgment was based on "sham" litigation as they try seize Chevron's assets to pay for a clean-up. Separately, the villagers also plan to use the newly disclosed evidence about Chevron's sampling results as yet another layer of corroborating science that confirms the validity of the underlying Ecuador judgment, which has been affirmed unanimously by two separate appellate courts in the country.
"This new information shows that Chevron not only polluted the Amazon, but is still committing fraud on various courts around the world by trying to cover up adverse evidence," said Juan Pablo Saenz, an Ecuadorian lawyer who represents the communities. "It is becoming even more obvious that Chevron's management and legal team are engaging in fraud and racketeering to avoid paying a valid legal judgment.
"Given the ongoing human suffering in Ecuador, this strategy is not only immoral," he added. "It is sickening."
The LBG report also appears to severely undermine Chevron's recent verdict in a non-jury "racketeering" trial before Judge Kaplan, who issued a "findings" in favor of the company without even reading the Ecuador trial record. That proceeding – which Kaplan used to try to discourage foreign courts from seizing Chevron assets – has been criticized for the judge's open bias in favor of the oil company and for violating various international law principles.
Chevron has been trying to use the tainted Kaplan ruling to influence foreign courts to block enforcement of the Ecuador judgment, but the villagers assert it will backfire against the oil giant because the proceedings were so clearly infected by Kaplan's bias and his many comments disparaging the villagers and their country's judiciary. (For background on Kaplan's bias, see legal petitions here and here.) In any event, lawyers for the villagers predict Kaplan's decision will be overturned on appeal in the U.S., rendering it a nullity.
Saenz, who has represented the Ecuadorians since 2006, said the LBG report and the evidence of the pre-inspection sampling will help the villagers in their two-decade battle for a comprehensive remediation of their ancestral lands.
"We are clearly getting closer to bringing this company to justice," he said. "For any objective observer, this report is the final nail in Chevron's coffin in terms of its responsibility for wrecking the Amazon rainforest of Ecuador."
The secret information from the pre-inspections also will be devastating for Chevron in the coming months in enforcement courts, said Saenz. "More and more of this information will come out in the weeks ahead as the redactions are lifted," he predicted, noting that the government of Ecuador has thus far not released thousands of pages of notes taken by Chevron technical experts in Ecuador.
As an example of Chevron's malfeasence, the new information demonstrates that the company's technical workers discovered four unlined oil waste pits at the Lago Agrio 2 well site during their secret pre-inspection. It then reported the existence of only one such pit during the official judicial inspection when the judge was present. "Based on its PI results, Chevron misleadingly elected to avoid identification of those locations it knew would demonstrate the existence of its contamination," the legal brief noted in paragraph #90.
At another site, called SS-25, the LBG team "confirmed that the contamination documented by Chevron in 2004 [in its pre-inspection] still exists and is continuing to spread… groundwater continues to transport the petroleum hydrocarbons into the stream and sediments." The group confirmed that residents used the stream as a primary source of drinking water (see paragraphs #102-103).
The executive summary of the LBG report can be read here; the redacted report can be read here, with the site investigation findings here and accompanying opinions here, here, here and here; and a summary of the report's findings is on pp. 37 to 56 of this legal brief.