Chevron, Ecuador and the $2.2 Million Man

By David R. Baker, San Francisco Chronicle
27 January 2012

In the sprawling legal drama surrounding Chevron Corp. in Ecuador, Diego Borja has played one of the strangest roles.

In 2009, Borja and a colleague used amateur spy equipment to secretly record two meetings with the Ecuadoran judge presiding over a massive oil-field pollution lawsuit against Chevron. Chevron used the videos to claim that the judge had already decided to fine the company and was involved in a $3 million bribery scheme. The judge denied the accusations but quickly stepped down. (One of his successors finally ruled against Chevron last year, and an appeals court this month upheld the $18 billion verdict.)

Questions soon arose about Borja, an Ecuadoran contractor who had worked for Chevron in the past, and his colleague, an American named Wayne Hansen.

Investigations revealed that Hansen pleaded guilty in 1986 to participating in a plan to smuggle 275,000 pounds of marijuana into the United States. And one of Borja's friends secretly taped a conversation in which Borja bragged about having dirt on Chevron that would cause the oil company to lose the lawsuit if he ever made his information public.

Chevron insisted that it did not pay Hansen or Borja for their videos, claiming the two acted as good Samaritans after learning of the possible bribery scheme. But the company did acknowledge paying Borja a stipend after he moved to the United States with his wife in late 2009.

So how much has Borja received? At least $1.19 million, according to new information from the legal team suing Chevron.

That figure covers monthly stipends for both Borja and his wife, plus the cost of renting and furnishing homes for them, first near Chevron's San Ramon headquarters, then in the Houston area. The company also paid the couple's taxes, both to the state of California and the federal government.

"The exorbitant amounts of money paid by Chevron to a low-level Ecuadorian worker is clearly hush money designed to buy silence from a many who can expose the company's corruption and is a likely witness in pending legal proceedings," said Karen Hinton, spokeswoman for the Ecuadorans suing Chevron.

Hinton's team assembled its figures from invoices and check stubs obtained last fall as part of the marathon legal fight. You can see a summary of the payments here, and some of the supporting documentation here, here, and here. The figures only cover money paid from June of 2009 and September of 2011.

The amount Chevron has allegedly spent on Borja jumps to $2.24 million if you include his legal bills, paid by the company. The people suing Chevron have been fighting to gather more documents from him, hoping to find the incriminating information he bragged about on tape.

"If Borja has nothing to hide, then why spend $1 million to prevent us from seeing his documents?" Hinton said.

Both Chevron and its opponents have used motions in U.S. courts to obtain previously confidential material from the other side. Chevron has used the tactic to devastating effect, winning access to the personal diary of the other team's former lead lawyer as well as outtakes from a documentary film about the case. (In one infamous outtake, the plaintiffs' former lead lawyer, Steven Donziger, calls evidence in the trial nothing but "smoke and mirrors and bulls**t.") Armed with those outtakes, Chevron has filed a counter-suit in the United States, accusing Donziger and his associates of extortion and racketeering.

Chevron spokesman Kent Robertson said Hinton was using the payments to Borja as a way to distract public attention from the fraud her team has committed.

"Rather than address the problem, they go after Borja," Robertson said.

He also pointed out a 2009 e-mail in which one member of the opposition's legal team tells colleagues that Chevron's payments to Borja, while lavish, probably don't violate the law. The same lawyer also questions whether Borja does, in fact, have any incriminating evidence against the company, calling the man's tape-recorded boasts "bombast from a trash-talker being prodded into making increasingly grandiose claims."

The case grinds on.  Chevron has appealed to Ecuador's highest court and has asked an international arbitration tribunal to block enforcement of the lower court's judgment. The tribunal is expected to hold meetings on the case next month.