Chevron in Ecuador

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Chevron Again Trying To Exclude Key Lawyer In Ecuador Case From U.S. Trial

Fearing Its Misconduct Will Be Exposed, Oil Giant Pushes Hard to Keep Donziger and Keker Out of Court

Amazon Defense Coalition

Amazon Defense Coalition
Contact: Karen Hinton at +1.703.798.3109

New York, NY – Chevron is again trying to exclude American lawyer Steven Donziger and his powerhouse attorney John Keker from a controversial trial in U.S. federal court over the company's $18 billion liability in an environmental case in Ecuador, according to court papers and representatives of the plaintiffs.

In court arguments made over the last several weeks before New York Judge Lewis A. Kaplan, Chevron again has claimed that Donziger – despite working 18 years on securing the judgment and being the lead target of Chevron's allegations – has no right to fight the company in a civil racketeering trial scheduled for November where the oil giant is seeking to prove that Ecuador's entire judicial system is broken. Donziger previously insisted on a jury trial to contest what he called Chevron's "outrageous" allegations; at that time, Chevron amended its lawsuit to drop Donziger as a defendant.

"Chevron clearly fears going head to head against Steven Donziger and his legal team before a jury where the company's environmental crimes and fraud in Ecuador will be laid bare," said Karen Hinton, the U.S. spokesperson for the 30,000 Ecuadorian rainforest residents who brought the lawsuit.

Chevron hopes a ruling by Kaplan in its favor will render the $18 billion judgment unenforceable. Numerous international legal scholars and Professor Burt Nueborne, a highly respected jurist at New York University, have said such a decision by Kaplan would violate international law and the U.S. Constitution and also would be an exercise in futility given that the U.S. judge would have no power to stop enforcement actions by the Ecuadorian plaintiffs in the dozens of countries where Chevron has assets.

The plaintiffs also believe that Kaplan is biased and already has decided to rule against Ecuador while he goes through the motions of conducting a trial in a personal attempt to survive appellate review, said Hinton. In an unusual move, the Second Circuit Court of Appeals has decided to hear a request for Kaplan's recusal and separately to determine whether the trial can go forward. Oral argument is scheduled for September 16 in Manhattan.

"Judge Kaplan has on numerous occasions expressed his deep-seated animosity toward the Ecuadorian indigenous people who have struggled for decades to right the terrible environmental wrongs Chevron committed on their ancestral lands," said Hinton. "He continually has denied or obstructed their right to submit evidence that challenged his pre-formed opinions of the case.

"Given Judge Kaplan's overwhelmingly hostile decisions that ignore the basic facts, combined with his utter lack of respect for the court system of a foreign sovereign and U.S. ally, it is clear to the Ecuadorians that this judge is planning a home-cooked judicial bailout for an American corporation that got held to account for its gross misconduct," she added.

Hinton emphasized that Chevron asked that the trial be held in Ecuador instead of the U.S., and for years praised Ecuador's court system. Now the company has sour grapes and wants a "do-over" because it lost in Ecuador, she said.

"Chevron is engaged in judge-shopping to the extreme," Hinton said.

In the meantime, Chevron has convinced Kaplan to bar Donziger and Keker – known as one of the nation's toughest litigators and the man who successfully prosecuted Oliver North – from having a fair chance to challenge the company's allegations. For example:

  • After Chevron's racketeering case was filed on Feb. 1, Keker called Chevron's bluff and demanded an immediate jury trial. Rather than face Keker in court, Chevron dropped Donziger as a defendant.
  • Judge Kaplan, after saying from the bench that the 18-year-old Ecuador litigation was no more than a "game" dreamed up by American lawyers, suggested to Chevron that it shelve the RICO case and proceed on a narrow declaratory judgment claim that would allow the court to condemn Ecuador's entire judicial system while providing a basis to exclude Donziger from the trial. Chevron quickly complied with the judge's request
  • After Chevron dropped him as a defendant, Donziger filed a motion to intervene as a full party. Chevron opposed it, and Kaplan denied Donziger's motion.
  • At Chevron's urging, Kaplan refused to let Donziger conduct discovery of Chevron even though Kaplan earlier had ordered Donziger to turn over to Chevron his entire case file with approximately 300,000 documents. In the meantime, neither Donziger nor the Ecuadorian plaintiffs have obtained a single document from Chevron via discovery.
  • In July, Donziger again asked Kaplan to reconsider his earlier denial of Donziger's right to fully participate in the trial. Predictably, Kaplan denied that motion as well.
  • In a telephonic court hearing last week, Kaplan invited Keker to participate and then ordered him not to talk when he tried to press a point on behalf of Donziger, according to a transcript of the proceeding.

With Kaplan's trial proceeding at a breakneck pace, Chevron has submitted 29 expert reports while the two Ecuadorian plaintiffs who are participating in the proceeding are struggling to find experts and have not taken a single deposition.

The Ecuadorians and Donziger have charged that Chevron contrived the latest legal action to distract attention from the fact that company management is under enormous pressure from institutional shareholders because of the size of the Ecuador judgment. In a detailed 188-page decision that followed an eight-year trial, a judge in Ecuador found on February 14 that Chevron's predecessor company Texaco systematically discharged billions of gallons of toxic waste into the waterways and forests of the Amazon when it operated there from 1964 to 1990.

The pollution decimated indigenous groups and caused an outbreak of cancer and other oil-related diseases that affect tens of thousands of people, according to the evidence.

For years Chevron has laid the groundwork to evade paying the judgment in Ecuador by stripping its assets from the country and forcing the Ecuadorian plaintiffs to look elsewhere to enforce any final judgment. Chevron's former top lawyer, Charles James, said publicly the company would "fight the case until hell freezes over and then skate it out on the ice."

Chevron made billions in excess profits from Ecuador by using sub-standard production methods that had been outlawed in the U.S. for decades before the company entered the South American nation, according to an expert report before the Ecuador court.

According to the U.S. State Department and other neutral analysts, Ecuador's court system is better than average for Latin America and far better than the court system of Venezuela, a country where Chevron has large investments and where the oil giant has never complained about the judiciary. Contradicting its own claims about Ecuador's courts, Chevron itself recently won large lawsuits in Ecuador, including one against Ecuador's state-owned oil company, according to a legal brief submitted to the Second Circuit.

Once it realized it would lose the environmental trial in Ecuador based on the evidence, Chevron began to attack Ecuador's court system and tried to engineer a political solution by hiring lobbyists in the U.S. to cancel Ecuador's trade preferences which account for 300,000 jobs in the country, said Hinton.

Both Donziger and the Ecuadorians are asking the appeals court to rule that a U.S. trial court has no right to judge the entire judicial system of a foreign nation, especially when the case in question is under appeal in that nation and no enforcement action has been initiated.

Hinton also said Chevron inappropriately steered the latest case to Kaplan, who in previous discovery-related matters had disparaged Donziger and the Ecuadorians.

Kaplan has openly mocked the Ecuadorians from the bench, calling them the "so-called" plaintiffs and questioning their very existence. Without conducting even an evidentiary hearing, Kaplan wrote decisions that purported to resolve key factual issues that already were being heard by the judge in Ecuador based on a trial record of more than 200,000 pages accumulated over eight years of hard-fought litigation.

Most of the Ecuadorian plaintiffs reject the jurisdiction of the U.S. court and intend to lawfully enforce any final judgment in countries around the world where Chevron operates, said Hinton.