Chevron’s False Allegations


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“Through scorched-­earth litigation, executed by its army of hundreds of lawyers, Chevron is using its limitless resources to crush defendants and win this case through might rather than merit. There is no sign that Chevron wants a trial on the merits.”

John Keker,  2013


Unclean HandsWith its options narrowing and on the verge of losing the Ecuador case, in 2009, Chevron launched a cynical strategy to evade its impending liability for contaminating the Amazon rainforest. Rather than comply with the law and clean up the toxic waste it had dumped, Chevron decided to invest millions of dollars in an abusive legal, public relations, and lobbying strategy to distract attention from its misconduct. 

The centerpiece of this strategy has been a vilification campaign against the individuals who played key roles in holding the oil major legally accountable for its crimes in Ecuador. One of the primary targets has been Steven Donziger, the only lawyer still working on the matter since the claims of the injured communities were filed in 1993 in U.S. federal court. But the Chevron retaliation campaign also targeted almost anybody who has tried to help the Ecuadorian communities – other lawyers, funders, scientific experts, journalists, bloggers, and human rights and environmental activists among them. Chevron even attacked the villagers themselves with preposterous allegations that they forged their signatures on the lawsuit. Four years later, Steven and some of his colleagues, along with the affected communities in Ecuador, have withstood one of the best-funded, longest-running corporate retaliation campaigns in history.

Chevron’s Long-Term Strategy: Demonize Donziger

Chevron press operative Chris Gidez put it succinctly in an internal company memo in 2009, two years before the judgment was issued: “Our L-T [long-term] strategy is to demonize Donziger.” And indeed the company has, while also hiring spies to follow him and his family in Manhattan and taping his every public movement in Ecuador. Even Chevron CEO John Watson called lawyers for the Ecuadorians “criminals” on one of the company’s public quarterly earnings calls with analysts and shareholders. To carry out its unprecedented retaliation campaign, Chevron has used six public relations firms, at least 200 private investigators, and hundreds of lawyers.

The goal of Chevron’s scheme is  to avoid paying for the massive devastation caused by its oil operations in Ecuador.   The company likely fears that if it does pay its obligations in Ecuador, it might open the floodgates to similar lawsuits by the many victims of Chevron’s shoddy and sub-standard operations around the world.  In 2011, after an eight-year trial that produced more than 220,000 pages of evidence, the Ecuador court found Chevron liable for $19 billion in compensatory and punitive damages for dumping billions of gallons of toxic waste water into the waterways of the Amazon. The Court also found that Chevron abandoned more than 900 toxic waste pits — most built in the 1970s —  that still dot the Amazon jungle in the area where it operated.  An appeals court in Ecuador unanimously affirmed the trial court  judgment. Punitive damages were imposed after the court found that Chevron engaged in a bad faith attempt to undermine the administration of justice in Ecuador, including threatening trial judges with jail if they did not rule in its favor.

Chevron’s Three-Pronged Attack

Chevron’s strategy to evade accountability in Ecuador involves three main avenues of attack designed to create a “record” used to file retaliatory lawsuits and otherwise try to block enforcement of the Ecuador judgment. They are:

  • fabricating and distorting evidence of corruption in Ecuador to falsely portray Chevron as a victim of an unfair trial;
  • misrepresenting the mountains of scientific evidence which clearly established Chevron’s liability; and,
  • leveling false claims of misconduct against Steven and others to damage their reputations, chill their Free Speech rights, and instill fear of economic harm such that they abandon their clients.

Chevron’s RICO Trial: Massive Denial of Due Process

Just days before the Ecuador court decided the case, Chevron returned to the same New York federal court where the plaintiffs had brought the original suit against the company nearly 20 years before (the case had been transferred to Ecuador in 2001 after Chevron filed sworn affidavits praising Ecuador’s judicial system as independent and fair). Chevron filed a sweeping, unprecedented, and clearly retaliatory racketeering lawsuit against the Ecuadorian rainforest villagers and their lawyers. Chevron’s fantastical theory is that Steven (working from his Manhattan apartment) and lead Ecuadorian lawyer Pablo Fajardo (working from an office in the Amazon town of Lago Agrio) led a global conspiracy involving lawyers, clients, and environmental groups designed to extort billions of dollars from the company via a “sham litigation.” Chevron’s trumped-up claims were filed under a civil RICO law that Congress had intended to be used to target organized crime groups like the Mafia.

The trial over Chevron’s retaliatory RICO case is set to begin in mid-October before Judge Lewis A. Kaplan in New York. However, Steven and the Ecuadorian Plaintiffs have filed a motion to have the case terminated due to stunning evidence of misconduct and corruption by Chevron. This includes the offer by Chevron lawyer Andres Rivero of a $1 million bribe to the Ecuador judge who found the company guilty, and other improper and exorbitant payments made by Chevron for favorable witness testimony. And Chevron has decided to drop roughly $60 billion in damages claims against Steven and his clients just to avoid presenting its “evidence” to a jury of impartial American citizens.

Fighting for a Fair Trial in Judge Kaplan’s Courtroom

It is clear why Chevron would prefer that Judge Kaplan decide this particular case alone.  In his long career, Judge Kaplan has earned a reputation as a judge who is eager to take on complex issues and who can be capable of handling them adroitly.  But in the Ecuador case, the villagers and Steven believe that the record suggests that Judge Kaplan has fallen short of the standards expected of an impartial jurist. Judge Kaplan’s decisions and comments from the bench about the Ecuadorian villagers and their country have generated considerable controversy. He repeatedly has called the Ecuadorians the “so-called” plaintiffs, suggesting they might not really exist.  Judge Kaplan also has said the villagers’ case is nothing more than “a giant game” whose purpose is for American plaintiffs’ lawyers to help “fix the balance of payments deficit” of the United States. He also said the Ecuador lawsuit was not “bona fide” litigation.  Judge Kaplan has been heavily criticized by international lawyers and academics for his approach to the case and for his lack of respect for the sovereignty of a foreign nation considered to have one of the better judicial systems in Latin America. (Chevron has won multiple civil lawsuits in Ecuador against the country’s state-owned oil company.)

A federal appeals court already unanimously reversed Judge Kaplan’s decision in an earlier part of the case that purported to impose an unprecedented global injunction blocking the Ecuador judgment. Famed trial lawyer John Keker has publicly called out Kaplan, saying he has allowed Chevron’s RICO case to degenerate into a “Dickensian farce” and that the judge has shown nothing but “implacable hostility” toward Steven.  Though determined to continue to defend the case, Steven has made his feelings clear: “There is simply no way that I nor my clients can get a fair trial in Judge Kaplan’s courtroom,” he said recently.  “But I will fight for a fair trial.  My hope is that Judge Kaplan will put his prior conclusions aside, let the full truth come out, and  carefully consider all of the evidence.”

Specific Responses to Chevron’s Allegations

Chevron’s strategy has been to use its superior resources to try to crush Steven and the Ecuadorians financially so it can win via might what it could never win on merit. Chevron’s strategy and Judge Kaplan’s bias have hamstrung their ability to mount a meaningful defense. For example, Chevron has asked the court to deny Steven and his clients the right to present the voluminous evidence of Chevron’s toxic dumping in Ecuador that the court in that country relied on to find the company liable. Judge Kaplan has barred Steven and his clients from presenting evidence of Chevron’s attempts to corrupt the Ecuador court and to bribe Ecuador’s government to illegally quash the environmental lawsuit. Judge Kaplan also has decided to limit most references to Chevron’s lobbying and pressure campaign designed to undermine the lawsuit, and he has determined that Chevron’s surveillance of Steven and his colleagues is privileged and cannot be discussed at the trial.

Chevron has also attacked the government of Ecuador to try to obtain taxpayer-funded bailout of its legal obligations in the country. Chevron is pleading with a secretive “international arbitration” panel of private lawyers to find that Ecuador’s government should pay for the clean-up.

In defending against this lawsuit, the Republic of Ecuador has retained an American law firm that has had ample resources to investigate and respond to many of Chevron’s allegations. Some of these responses include a written submission to the international arbitration panel; an expert report on the science in the case brought by the villagers; and annexes that correspond to specific allegations.  While these materials do not capture the entire story of Chevron’s malfeasance in Ecuador and abusive litigation practices, they do provide critical and helpful perspective to understand the company’s allegations.

These documents are as follows:

Republic of Ecuador Counter-Memorial: This document, submitted in February 2013,  provides a comprehensive summary of the overwhelming evidence against Chevron and explains why the Ecuador court’s decision is reasonable and based on the evidence.

Louis Berger Group Report on Scientific Evidence:  This expert analysis of the scientific evidence in the Ecuador case concludes that:  a) Chevron proved the case against itself; b) the overwhelming weight of the scientific evidence is against Chevron; and c) the amount of damages found by the court is reasonable in light of the evidence.

Donziger’s Response to Chevron’s Motion for Summary Judgement:  Demonstrates that hundreds of specific Chevron allegations against Steven and his colleagues are either false, distorted, incomplete or disputed.

Annexes from the Republic of Ecuador’s Counter Memorial:

  • ANNEX AResponse To Claimants’ Allegations Regarding Judicial Independence: addresses Chevron’s allegations that Ecuador’s judiciary lacks independence.
  • ANNEX B—Response To Claimants’ Allegations Regarding The Criminal Proceedings Against Messrs. Veiga And Pérez: explains why criminal charges were filed in Ecuador against two Chevron lawyers.
  • ANNEX CResponse To Claimants’ Bribery Allegations: explains Chevron’s false allegations that an Ecuador judge was involved in a bribery scheme.
  • ANNEX D—Response To Claimants’ “Ghostwriting” Allegations: addresses Chevron’s false “ghostwriting” allegations as they relate to the Ecuador judgment.
  • ANNEX E—Response To Claimants’ Allegations Regarding Messrs. Calmbacher And Cabrera: addresses Chevron’s allegations with respect to two experts in the case, Charles Calmbacher and Richard Cabrera.
  • ANNEX F—Response To Claimants’ “Collusion” Allegations: Responds to Chevron’s allegations of “collusion” between the Ecuadorian villagers and the Republic of Ecuador.
  • ANNEX G—Response To Claimants’ Allegations Of Legal Error: addresses each of Chevron’s false allegations of legal error committed by the Ecuador trial court.
  • ANNEX H—Summary Of Lago Agrio’s First Instance And Appellate Court Decisions: provides a comprehensive and detailed summary of the legal decisions in Ecuador.

 

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