By Abby Ellin, The New York Times
8 May 2003
A group of American lawyers representing more than 30,000 indigenous people in Ecuador filed a $1 billion lawsuit against the ChevronTexaco Corporation yesterday.
The suit was filed in Ecuador on behalf of 88 plaintiffs in Lago Agrio, a small oil town in northern Ecuador, and asserts that during two decades of operation, from 1971 to 1992, ChevronTexaco dumped over four million gallons a day of toxic wastewater, contaminated with oil, heavy metals and carcinogens into open pits, estuaries and rivers.
It also says the company left behind nearly 350 open waste pits that killed people and animals.
"We believe that what ChevronTexaco did in the Ecuador rain forest was not only negligent but might rise to the level of reckless behavior," said Joseph Kohn, a lead lawyer for the plaintiffs and a partner in Kohn, Swift & Graf in Philadelphia.
ChevronTexaco denies any wrongdoing and maintains that its practice was consistent with the practices of Ecuador's national oil company, Petro Ecuador, as well as internationally recognized standards.
The case, in litigation for almost a decade, has been dismissed four times. In August 2002, the United States Court of Appeals in New York ruled that the case should be sent to Ecuador, as ChevronTexaco originally wanted. It also ruled that American courts could step back in if the plaintiffs were unable to bring their case or if ChevronTexaco did not adhere to the Ecuadorean court's final decision.
The suit filed in Ecuador yesterday is the first step in adhering to the appellate court's direction.
Typically, cases against multinational corporations tried in developing countries languish there, as most plaintiffs cannot afford to sue in third world countries or do not have proper legal representation. If a corporation does lose, it often contends that the case was unfair or that "the proceedings in the foreign county did not adhere to our notions of due process," said Michael P. Van Alstine, a professor of international commercial law at the University of Maryland.
This case is significant, legal experts say, because it could create a new way for multinational corporations to be held financially accountable for environmental abuses in foreign countries.
Chris Jochnick, a lawyer and founder of the Center for Economic and Social Rights, a human rights organization with offices in New York and Ecuador, said: "The case has become something of a symbol for the abuses and lack of accountability of U.S. multinationals abroad, and of the efforts of local communities to organize and try to bring pressure to bear on those companies. You have both sides represented."
Any financial penalty imposed on ChevronTexaco is enforceable in the United States, which "adds an additional layer of security for the plaintiffs," Mr. Jochnick added.
In 1993, ChevronTexaco hired environmental consulting firms to conduct audits and identify the need for any remediation, said Chris Gidez, a spokesman for ChevronTexaco in Fairfield, Conn. In 1995, ChevronTexaco began a $40 million cleanup of about 250 drilling sites, which the Ecuadorean government deemed complete in 1998, Mr. Gidez said.
Mr. Gidez added that the oil operations took place over about 6,400 acres, or less than 1 percent, of the Ecuadorean rain forest. "The Ecuadorean government," he said, "encouraged growth - colonization, building of roads - in that area. To ignore all that activity as having a contributing impact on the environment is like walking around with blinders on."
This weekend, Amazon Watch, a nonprofit environmental group in San Francisco, plans to bring a group of 13 indigenous leaders from Ecuador to San Ramon, Calif., the world headquarters of ChevronTexaco. The organization plans to stage protests and hold educational forums to "raise awareness with community members of what their neighbors are doing in the rain forest," said Leila Salazar, an organizer with Amazon Watch's ChevronTexaco campaign.
With 2.1 billion barrels of proven reserves, Ecuador is an important player in the Latin American oil business. "It's going to be interesting to see how a country that's so dependent on oil development is going to hold this corporation accountable," Ms. Salazar said.