Chevron in Ecuador

The archive of the Clean Up Ecuador campaign website

More Pressure On SEC To Investigate Chevron For Hiding Massive Environmental Liability In Rainforest

Amazon Watch

Amazon Watch
Contact: Karen Hinton at +1.703.798.3109

Click for full text of follow-up letter to the SEC

San Francisco, CA - Chevron distorted the results of a court report in Ecuador to hide a multi-billion liability it faces in a landmark environmental trial in the Amazon over what locals dub the "Rainforest Chernobyl", Amazon Watch has informed the Securities and Exchange Commission in a follow-up letter to a complaint the environmental group lodged with the regulator last month.

Chevron is defending itself in Ecuador in a class-action lawsuit brought by 30,000 residents, who charge that over 25 years the company dumped more than 18 billion gallons of toxic waste water across an area the size of Rhode Island. Experts regard the resulting contamination as possibly the worst oil-related disaster in the world. Two indigenous tribes, the Cofan and Secoya, are on the brink of extinction, and cancer rates in the area have skyrocketed in recent years.

The case, filed in 2003 and expected to conclude next year, is the first ever against an American oil company in the Third World for significant environmental damages. The locals are represented by a team of Ecuadorian and American lawyers.

The environmental group, Amazon Watch, charged in the SEC letter that Chevron issued a misleading press release on February 2 that falsely claimed a court report concluded that there was no danger to public health at one well-site, known as Sacha-53. Sacha-53 is one of the 350 contaminated well sites the company left in the rainforest, according to the lawsuit.

In their latest letter to the SEC, Amazon Watch Executive Director Atossa Soltani and legal counsel Sarah Aird write: "Chevron's misinformation campaign was launched within minutes of the release of this court report, when the company posted on its website, and mass-emailed to hundreds of media outlets, a press release that distorted the reports' findings."

They added: "Chevron's misleading press release is just one example of many in which it appears Chevron has not abided by its legal duty to communicate honestly with shareholders and the public markets in general."

Last month, Amazon Watch sent the SEC a letter calling for an official investigation of Chevron for failing to disclose its Ecuador liability in its public filings. The plaintiffs estimate clean-up costs could surpass $10 billion

The latest Amazon Watch letter pointed out that the court report actually found Total Petroleum Hydrocarbons (TPHs), a widely regulated bundle of toxic petrochemicals, at concentrations over 1,000 times higher than permitted by Ecuadorian law. Cadmium, another toxin, was found at concentrations 10 times higher than permitted by Ecuadorian law. Crucially, the report authors refused to express any view about whether these levels were in violation of any norms or standards, leaving that determination to the judge.

That conclusion was grossly misrepresented by Chevron's claim that the report "validated" its defense at trial, according to the letter.