In this Chevron Ecuador Update, the Argentine Appeals Court rejected the plaintiffs Ecuadorian judgment in the ongoing lawsuit against the San Ramon-based energy company. The simple reason is because Chevon was never in Ecuador to start with, either directly or financially.
“The local courts lack international jurisdiction to hear the main claim because there is no reasonable point of connection between the case and the forum,” the Chamber of Appeals said in its decision on July 3 2018.
R. Hewitt Pate, vice president and general counsel for Chevron said “Just weeks after favorable court decisions in Brazil, Canada, and Gibraltar, the extortion scheme against Chevron continues to collapse. Argentina’s court of appeals has tossed out this case, and any court that respects the rule of law should do the same.”
The Argentine Appeals Court decision also completely reverses Argentina’s orginal November 2012 action where Argentina Civil Judge Adrian Elcuj Miranda ordered up to 40 percent of Chevron’s bank accounts in Argentina to be held in escrow after the original Ecuador decision against the California-based company.
The Slow End Of A Long, Fraudulent, Lawsuit
This is the latest in a string of losses racked up by plaintiffs lawyers led by American attorney Steven Donziger, in a desparate attempt to enforce the fraudulently-obtained Ecuadorian judgment in other jurisdictions. As to what the Ecuadorian judgment is, it was borne of the 2011 Ecuador Court decision against Chevron, and for a fine of $19 billion. At first read, the World believed the court outcome. And any summary of the proceedings from 2011 would read something like a complete slam dunk against Chevron.
In 2011, the Supreme Court in Ecuador wrongly ruled and reported that Chevron, which was the owner of the non-Ecuadorian asssets held by Texaco up to 1992, had deposited oil in jungles, waterbodies, roads and farmlands adjacent to Ecuadorian communities. The leavings included approximately 880 Olympic pool-sized pits filled with petroleum waste; 650,000 barrels of crude oil spilled in the jungle and on farmland; and an estimated 60 billion gallons of toxic waste dumped into waterways. In addition, the Ecuador court determined that more than 3,000 miles of kilometers of Amazonian roads have been covered in crude oil in recent decades.
(The fact is, none of that was Chevron or Texaco’s fault – the blame fell to the Ecuador-run PetroEcuador, but that’s the way it was presented and part of a constant and at times massively silly effort to blame Chevron. Keep that in mind, because when you learn the truth, you’re mind’s going to be altered, and you will understand why the word “fraud” consistently comes up when this Ecuador lawsuit is mentioned in the media today.)
The Steven Donziger-led plaintiffs also filed what they claimed was substantial evidence of elevated cancer rates, other health problems, and contamination of traditional food supplies, providing the basis for an initial judgment of more than $17 billion. The lower Ecuador court decision was affirmed by an Ecuadorian appeals court, and reduced to $9.5 billion by the National Court of Justice of Ecuador. Because Chevron had no assets in Ecuador, Donziger and the plaintiffs went around the World, seeking compensation from the company’s other international operations via court action. And losing in court – but that was a few years later. We’re still at 2011 – 2012.
It was then that the entire case that seemed to go in Steven Donziger’s favor fell apart, and fast.
First, it was found that the Ecuador Court judge in the case, Nicolas Zambrano, was being paid to find a ruling favorable to Donziger and against Chevron. Moreover, Alberto Guerra, the Ecuador Appeals Court Judge, later told the U.S. Court in the Racketeer Influenced and Corrupt Organizations Act (RICO) lawsuit Chevron filed against Donziger in 2013, that he met with Donziger in 2009 and other representatives at a restaurant in Quito, Ecuador. There, Guerra said that Donziger thanked him for the work he was about to do: ghost-writing the Zambrano decision (and it was later found with Donziger’s help) against Chevron. For that, Guerra was paid $1,000 a month by members of Donziger’s team. To make it plain and simple: Donziger had engaged in bribing the Ecuadorian judges.
Here’s Donziger, in an outtake from the movie “Crude” explaining that he was, indeed, intimidating and adding pressure to judges in Ecuador. It was Guerra who confirmed that Donziger also paid money to those same judges, even though Donziger had denied it in the RICO-case court:
Second, The so-called environmental damage evidence you saw above and from the 2011 decision turned out to be entirely falsified by consultants hired by Donziger. Christopher Bogart of Burford Capital, which gave Donziger up to $15 million to finance his case against Chevron, pulled out because “There was quite a lot of disturbing information coming out,” said Bogart.
Bogart told the 2013 RICO court that emals between Donziger and the other plaintiffs lawyers and bimself were enough to tell him the case was dirty.
And David Russell, an engineering consultant working for Donziger told the RICO Court he was asked to make up an exaggerated cost estimate for the Ecuador environmental clenup.
In all, it was found and primarily in the Racateer-Influenced RICO case where U.S. Judge Lewis Kaplan eventually ruled againast Donziger and his team. On February 28 of this year, and regarding what Donziger owes in court costs to Chevron, Judge Lapham summarized his original decision of 2014:
“This Court found after a lengthy trial that Steven Donziger and his co-conspirators attempted to extort billions of dollars from Chevron Corporation. They did so by, among other things, violating the Racketeering Influenced and Corrupt Organizations Act (“RICO”), foisting fraudulent evidence on an Ecuadorian court, coercing Ecuadorian judges, illegally writing all or much of the Ecuadorian court’s purported decision, and then procuring the signature of an Ecuadorian judge on a $19 billion judgment against Chevron that the co-conspirators had written, in part by the promise of a $500,000 bribe. This Court found also, and independently of RICO, that Donziger’s actions were wrongful under the common law.”
That judgement was the beginning of the slow end of Donziger’s attempt to, as he once said, get billons from Chevron – he even expected to get rich from the fraudulent effort.
This year, Donziger told Judge Kaplan that Chevron’s attempt to recover court costs was frivolous and violated the first amendment. The response by Judge Kaplan is classic and worth reading. Forbes Michael Krauss has the summary as follows:
Donziger’s claim regarding Chevron’s purported corruption of the judicial process is frivolous for three reasons. First, “What judicial bodies? In what proceedings? Held in abeyance until when? And what possible relevance might these speculative possibilities, if any there are, have to the taxation of costs in this case?” Second, “the [impugned] testimony of Guerra was far from indispensable to the judgment rendered in this case. As the Court’s opinion makes clear, this Court would have reached precisely the same result in this case even without the testimony of Alberto Guerra.” Third, that result was a finding that Donziger and his co-conspirators had, among other misdeeds, “(1) blackmailed [Ecuadorean] Judge Yanez to abandon the judicial inspections and to appoint Cabrera as the global expert, (2) corrupted Cabrera, (3) wrote Cabrera’s report, (4) falsely passed off Cabrera’s report as the work of an independent and impartial expert, and (5) ghost-wrote former [Ecuadorean] Judge Zambrano’s purported decision which demonstrably relied on the fraudulent Cabrera report notwithstanding its disclaimer.” Alberto Guerra’s testimony was irrelevant to the first four delicts and was superfluous to the evidence of the fifth. Guerra testified that Zambrano had been bribed, which was not one of the five grounds for refusal to enforce the Ecuadorean judgment. In any case, the judge found Guerra largely credible, despite the fact that living expenses had been paid by Chevron.
2) Donziger’s First Amendment claim has been rejected by every court that ever heard it.
3) The fact that an ethics referral has apparently been made to New York State authorities is no grounds for recusal of a judge as regards taxation of costs. The contrary claim is utterly frivolous.
4) “[I]t came out at trial that Donziger received cash and real estate worth $1.8 to $1.9 million from “family estate related matters” during the two years prior to trial, i.e., in the period from October 2011 until October 2013,69 during which payments to the Keker firm appear to have stopped or fallen well behind. Other evidence showed that Donziger personally received somewhere between $958,000 and $1.3 million from litigation funders before trial, and the figure could well have been higher because the records from which that information was gleaned were incomplete. There simply is no factual basis from which the Court responsibly could conclude that Donziger is unable to pay costs in the full amount taxed by the Clerk or that the amount of any such judgment should be reduced to avoid undue financial hardship.” In any case, the Ecuadorean litigation was third-party funded, likely to the tune of over $32 million, and Donziger controlled that funding, admitting spending over $21 million on the case.
So, it is obvious that Donziger cleaned up and became a millionaire – maybe not the billionaire he envisioned himself to be on the path to become, but from this report, he collected a healthy haul for himself, and all from the successful litigation financing of his fraudulent lawsuit against Chevron.