Chevron in Ecuador

The archive of the Clean Up Ecuador campaign website

Ivonne Baki Tried to Help Chevron Bribe Ecuador's Government to Thwart $18 Billion Environmental Case, Court Documents Suggest

Chevron Admits In Legal Papers That It Used Baki Repeatedly As Part of Its Lobbying Effort To Destroy Lawsuit

Amazon Defense Coalition

Amazon Defense Coalition
22 December 2011 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109

New York, NY – Ivonne Baki, an Ecuadorian government official in charge of one of the world's most celebrated environmental initiatives, has had numerous contacts with Chevron's U.S.-based lawyers to assist the oil giant's illegal attempts to thwart a historic environmental case in Ecuador where Chevron was found liable for $18 billion in damages, according to Chevron's legal filings in a U.S. federal court case and sources within Ecuador's government.

Baki is caught up in a burgeoning scandal in the South American nation following the publication of a blog this week in the Huffington Post on-line newspaper that accused her of promoting a "billion dollar bait-and switch" whereby Chevron would pay hundreds of millions of dollars to Baki's Yasuni project in exchange for an agreement that Ecuador's government would quash the legal case. The blog was written by Mitch Anderson, a campaigner with the U.S. environmental group Amazon Watch.

Pablo Fajardo, the lead lawyer for the Ecuadorian plaintiffs who won the judgment, said separately that he had confirmed from high-level sources in Ecuador's government that Baki was floating an idea where Chevron would pay $1 billion – half of it to the Yasuni project, and half of it to the government to help with an environmental clean-up – in exchange for the government exercising its political influence to stop the case.

There is no evidence anybody in Ecuador's government considered accepting the proposal, which would have violated the legal rights of tens of thousands of victims of Chevron's pollution and violated the country's Constitution, said Fajardo.

"Chevron and Baki think Ecuadorian officials are still running a banana republic government willing to sacrifice the rights of their own citizens for a small bribe," said Fajardo. "Chevron just doesn't get that it cannot bribe government officials."

The news that Chevron has been trying to use its longtime ally Baki to end-run its legal liability has created a media firestorm in Ecuador. Unflattering articles about Baki based on the Huffington Post blog have appeared, with Baki deepening her woes by falsely claiming she has no ties to Chevron. See here, here and here.

In the meantime, Chevron has disclosed in a U.S. federal court proceeding that it has had extensive contact with Baki over the environmental case, contradicting Baki's public statements. See here.

Chevron's response to various interrogatories in that action mentions Baki by name in describing four meetings to discuss the case – three when Baki was a former government minister and one in 2008 with Correa cabinet minister Gustavo Larrea. Chevron also describes several meetings in 2010 with officials from Correa's government without mentioning the names of the individuals.

There were also meetings in 2011 between Chevron's U.S.-based lawyers and Baki, and a Chevron representative in Venezuela and an Ecuadorian government official believed to be Baki, according to sources in Ecuador's government. Chevron either covered up those meetings or forgot to mention them in the U.S. court documents even though it was obligated to do, said Fajardo.

Fajardo also confirmed via sources in Ecuador's government that Baki in recent weeks was floating a proposal from Chevron whereby the oil giant would pay $500 million under the guise of a "donation" to her Yasuni project, and a small additional amount to be used for environmental remediation. Chevron was working through Baki to convince Ecuador's government to quash the legal case in exchange for the money, according to Fajardo's sources.

"Chevron used Baki to try to bribe Ecuador's government to violate the rule of law and kill off the historic legal case," said Karen Hinton, the U.S.-based spokesperson for the Ecuadorians. She said the team was still investigating the extent of Baki's role.

"Information we have thus far suggests a series of bribes were offered by Chevron that were disguised as donations or clean-up monies, the totality of which would allow the company to escape its legal liability for pennies on the dollar," Hinton said.

Even with her checkered history of helping Chevron and its predecessor company Texaco, Baki is now the head of Ecuador's Yasuni-ITT initiative because of her supposed array of international contacts that Ecuador wants to use to raise money for the environmental project. Baki served as Ecuador's ambassador to the United States in the late 1990s when she tried to help Chevron kill the legal case. She later served as Ecuador's representative to the Andean Parliament.

The Yasuni project seeks to keep more than one billion barrels of crude permanently in the ground in a biodiverse area of Ecuador's Amazon rainforest in exchange for payments over ten years of $350 million annually from foreign nations and donors.

Ecuador President Rafael Correa has set December 31 of this year as the deadline to obtain $100 million as a down payment or drilling rights in the area could be quickly auctioned on the international market, potentially threatening two non-contacted indigenous groups thought to be living in the isolated area. Baki has come up with virtually no money for the project, despite her public statements saying she was garnering support, said Fajardo.

Environmental leaders in Ecuador blasted Chevron and Baki.

"We are not about to give Chevron a get out of jail free card by donating to the Yasuni," said Esperanza Martinez, who heads up Ecuador's leading environmental organization Accion Ecologica, in an interview with the Huffington Post. "Not only would such a donation violate the rights of thousands of Ecuadorians who are victims of Chevron's misconduct, it would also violate the very spirit of the initiative.

"In short, Ecuador is not interested in Chevron's blood money," she added.

Kevin Koenig, a spokesman for Amazon Watch, also blasted Chevron for trying to engage in a "multi-billion dollar bait and switch."

"It's illegal, and can't be allowed," he said, referring to Chevron's proposed "donation" to the Yasuni. "We are calling on Ms. Baki to disclose all meetings between herself and Chevron officials, and the terms and conditions of any offer from the company."

The court in Ecuador found in February that Chevron deliberately discharged more than 16 billion gallons of toxic waste into Ecuador's Amazon when it operated an oil concession from 1964 to 1992, leading to a spike in health problems and decimating indigenous groups.

Chevron's latest attempt to maneuver its way out of the case comes at a time when its legal position has weakened considerably. Not only did the company lose the Ecuador trial in February of this year, but it was sternly rebuked by a federal appeals court in the United States in September for trying to invalidate the Ecuadorian judgment in U.S. federal court.

Chevron faces other potential legal jeopardy in the coming months. An Ecuadorian appellate court is preparing to rule on the underlying trial and the Second Circuit Court of Appeals in New York is expected to issue a decision about legal attacks Chevron has waged against the Ecuadorians in U.S. federal court.

Baki has a long and checkered history in Ecuador – particularly as it relates to the legal case against Chevron.

In 1998, when she served as Ecuador's Ambassador to the United States under the rightist government of Jamil Mahuad, she signed an official letter to a U.S. federal judge in New York that had been requested by Chevron. Ecuador's President at the time rebuked Baki for failing to inform the country's Attorney General that she was writing the letter, which was quickly disavowed.

When Baki served as Commerce Minister under the rightist government of Lucio Gutierrez, the rainforest residents staged a sit-in in her offices to demand that she stop undermining the legal case against Chevron.

In 2008, Baki bragged to lawyers for the plaintiffs that she had arranged a private meeting for top-level Chevron officials and Gustavo Larrea, at the time an influential minister in Correa's cabinet.

Baki also has been active in Chevron's lobbying efforts in the United States to cancel U.S. trade preferences for the country in retaliation for the lawsuit, which is taking place in Ecuador at Chevron's request. A cancelation of the preferences would cost Ecuador upwards of 300,000 jobs, according to Ecuador's government.

"In my opinion Baki is a political mercenary of the highest order," said Luis Yanza, a community leader in the Amazon. "She is precisely the kind of unsavory character that Chevron feels comfortable dealing with as it engages in acts of trickery to avoid being held accountable by the law."

Chevron has been accused of numerous acts of corruption in Ecuador during the trial, forcing the court to fine its lawyers and impose punitive damages on the company.

The acts of corruption include lying about the results of a fraudulent remediation in the 1990s to secure a government release; fabricating evidence during the trial to minimize evidence of contamination; using a hidden video recorder to try to entrap a judge who Chevron thought would rule against it; threatening judges with jail time if they failed to grant Chevron's motions to delay the trial; and permitting the lawyers for the plaintiffs to be victimized by death threats and mysterious robberies of their offices.