The battle pits
Chevron Corp., the giant American oil company hit with a record $19 billion fine by an
Ecuadorean court in 2011 for fouling the
Amazon rain forest, against
Steven R. Donziger, the colorful and well-known New York lawyer who orchestrated the monumental
Amazon case. The lawyer even starred in a documentary in which he was portrayed as the hero who brought justice to impoverished Indians in the
Amazon whose health and homes were destroyed by a
Chevron subsidiary’s oil drilling operations there in the 1960s.
The case is playing out in the U.S. District Court in Manhattan, which ruled this summer against bids by
Mr. Donziger to delay a trial scheduled for October and to lodge countercharges against
Chevron for ruining his reputation and livelihood.
Chevron is brandishing evidence based in part on outtakes of the Hollywood-made documentary “Crude,” in which
Mr. Donziger seems to admit to fabricating evidence and other frauds in his drive to win the
Amazon case.
Also playing a bit part in the drama is Ecuadorean President
Rafael Correa, who has been the leading cheerleader for the judgment against
Chevron, which found the company liable retroactively for damages from not having conducted a more thorough cleanup of the
Amazon than required by the laws on the books at the time the company was drilling there.
Chevron said its subsidiary
Texaco, which the company acquired after the
Amazon incident in 2001, obtained a certificate from the
Ecuadorean government saying it fulfilled its legal obligation to conduct a cursory cleanup of the 16 billion gallons of toxic drilling waste dumped in the rainforest and streams of the
Amazon during the years it drilled there, releasing the company from any future liability.
After two decades of seemingly endless litigation over the drilling incident in
Ecuador, the action is centered in New York as
Chevron seeks to undermine the widely questioned and oversized Ecuadorean verdict. Environmental groups say
Chevron has spent more than $1 billion and hired an army of 2,000 attorneys from 60 top law firms to prosecute the case but spent only about $40 million to clean up the
Amazon after a decadeslong wave of contamination there that dwarfs all other environmental spills in size.
Attorney Pablo Fajardo, Joe Berlinger and attorney Steven Donziger attend the Sundance ... more >
A favorable ruling by the
Manhattan court might render uncollectable the giant $19 billion 2011 verdict against
Chevron, which
Mr. Donziger and Ecuadorean groups are seeking to enforce with motions to seize
Chevron assets in
Canada,
Argentina and
Brazil.
Chevron has refused to pay any of the fine on the grounds that the verdict in
Ecuador was a fraud. If it loses the case, the consequences for
Chevron also could be severe, giving impetus to the Ecuadorean case against the company in international courts.
Mr. Donziger recently complained to the
Manhattan court that the barrage of charges and court filings
Chevron has levied against him in the civil racketeering case may bankrupt him and “devolve into a mockery of justice and due process.”
Chevron has dropped $60 billion in damage claims against two co-defendants of
Mr. Donziger from
Ecuador, but it is still seeking the huge sum from the attorney.
Despite charges of foul play, District Judge
Lewis A. Kaplan has largely sided with
Chevron to the point that
Mr. Donziger’s original legal team in the case resigned this year, citing bias by the judge.
Mr. Donziger also fell behind in paying his legal bills.
The judge noted that
Mr. Donziger — in one of the many rich subplots in the case — at one point gained millions of dollars in financing for the legal battle from a hedge fund and
Patton Boggs, a deep-pocketed Washington law firm, in exchange for a share of the huge settlement against
Chevron. The hedge fund,
Burford Capital, backed out of the transaction after providing an initial payment of $4 million, citing the allegations of fraud against
Mr. Donziger.
Chevron has been delighted by a sympathetic ear from the New York court and several other courts in the U.S. that have looked into the matter during years of litigation.
“There is abundant evidence before the court that
Ecuador has not provided impartial tribunals or procedures compatible with due process of law,” Judge
Kaplan said in an early ruling in the racketeering case.
Chevron is charging
Mr. Donziger with fraud and misconduct for, among other accusations, ghost-writing the
Amazon verdict after bribing an Ecuadorean judge, who has admitted to the fraud in an affidavit; paying off witnesses; and engineering a bogus report providing critical scientific evidence that led to
Chevron’s conviction.
The research firm that wrote the scientific report,
Stratus Consulting, later renounced all its conclusions that
Chevron had contaminated the drinking water of thousands of
Amazon natives, leading to deaths, cancer and other serious health problems. In exchange for recanting its testimony,
Chevron withdrew fraud charges against the consulting company.
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