Yesterday, Kellan Howell at The Washington Times published what can only be described as a hit piece against Amazon Watch, our longtime advocacy partner and sometimes client, for AW’s continued support for a cleanup of Chevron’s legacy of contamination in the Ecuadorian Amazon. Apparently, because a federal judge found that one attorney (Steven Donziger) committed fraud in the Ecuadorian pollution trial – a decision which is currently being challenged on appeal – that means that AW should stop advocating for a cleanup.
(I won’t link to the article, but AW’s response is here.)
If I were a snarky blogger, I might respond by saying something like, “Nice to see Kellan Howell take a break from cheerleading Donald Trump’s immigrant-bashing to focus on a genuine issue of corporate accountability!” Or maybe: “Of course The Washington Times is my favorite local newspaper; what other totally respectable news organization would run “photo essays” on the best handguns under $500, and on the disputed title of the “sexiest woman alive,” and then – in a truly masterful stroke – combine these two interests with Hollywood’s hottest gunslingers? If that’s not Pulitzer-bait, I don’t know what is.”
But of course, I’m a sober-minded lawyer, not a snarky blogger, so I’m really more interested in some boring legal issues raised by Ms. Howell’s article.
Is this journalism – or a tort?
Ms. Howell started her investigation (I’m using the term generously) a couple months ago, by emailing a series of Chevron talking points to several AW funders. The emails read, in part:
Amazon Watch has worked closely with lawyer Steven Donziger in the case against Chevron, even letting Mr. Donziger write press releases that contained inaccurate and misleading information about Chevron to be distributed by Amazon Watch.
Last year a US District Court found that Mr. Donziger had fabricated evidence, ghostwritten studies and bribed judges to win the initial case against Chevron. The fraud charges prompted many of the investors in the case to back out. In his 500-page opinion, Judge Kaplan wrote that Amazon Watch worked directly with Mr. Donziger to distribute the false material, lobbied the media and the SEC to investigate Chevron and pressured shareholders and state comptrollers to sponsor shareholder resolutions to pressure Chevron to pay billions of dollars to settle the case.
Given this information, what I am interested in learning from the foundation is
1. does the foundation still give money to Amazon Watch?
2. Is the foundation aware of Amazon Watch’s involvement in the Chevron case and its close connection with Mr. Donziger?
3. Did the foundation know that its contributions to Amazon watch was being used to perpetuate false evidence in this case?
4. If so, what is their reaction? Does that bother them and why keep funding the organization?
As I pointed out to Ms. Howell in an email at the time, this is not what I think of as journalism – it’s trying to generate a reaction, rather than reporting on facts in the world. But that’s not the biggest problem with it – the biggest problem is that it’s demonstrably false. The centerpiece of Ms. Howell’s email is: “Did the foundation know that its contributions to Amazon Watch were being used to perpetuate false evidence in this case?” (Full disclosure: I altered that quote to correct the capitalization and grammar.) As I wrote to Howell, this is not true:
First, Judge Kaplan did not actually find that Amazon Watch had said anything that was false. He faulted Amazon Watch for repeating an estimate that the Ecuador cleanup would cost $6 billion after the author of that estimate disavowed it, but Judge Kaplan did not make a factual finding that the cleanup would in fact cost less than $6 billion – in fact, the Ecuadorian court found that it would be more expensive than this. He also faulted Amazon Watch for repeating Donziger’s estimate that the oil spilled in Ecuador was 30 times the size of the Exxon Valdez spill, but Judge Kaplan made no factual findings as to how large the amount of oil spilled actually was. In fact, Judge Kaplan could not have made any factual findings about the extent of contamination in Ecuador or the cost of a cleanup, because those issues were excluded from the Chevron v. Donziger trial. If he had addressed the issue, he would have considered the deposition testimony of Bill Powers – the same expert that Kaplan relied on to suggest that the 30 times estimate was misleading – who said that “the amount of toxic liquids that should not have been in the environment in Ecuador was at least 30 times the quantity or the volume of crude that was spilled in the Exxon-Valdez disaster.”
Second, neither of these statements – the $6 billion estimate or the Exxon Valdez comparison – was submitted by Amazon Watch in court, and therefore neither constitutes “evidence.” While AW has engaged in extensive public advocacy in favor of a cleanup of Chevron’s documented environmental catastrophe in Ecuador, AW has not been directly involved in submitting any evidence, let alone “false evidence,” in either the Lago Agrio litigation or the Chevron v. Donziger case. Your email suggests that AW was a participant in one or both of these cases, which is false. AW did not participate in the Chevron v. Donziger litigation, and Judge Kaplan’s findings, which are currently being reviewed on appeal, would not be legally binding on Amazon Watch because it was not a party to that litigation.
Third, you sent your emails apparently without regard to what projects had been funded. You have no basis on which to assert that any particular funder’s contributions were used by Amazon Watch for its Clean Up Ecuador campaign, which is only one of many Amazon Watch activities.
Ms. Howell’s statement might be considered libel, but there’s another more specific tort for this context – it’s called “interference with business relations.” If someone lies to a company that you’re doing business with, and the company stops doing business with you as a result, you can be held liable.
Of course, virtually all of AW’s funders either ignored Ms. Howell’s misinformation entirely or indicated their ongoing support for AW. But Ms. Howell reports that at least one partner – Pura Vida – was taken in by her lies. So both Ms. Howell and The Washington Times might be held responsible for any losses to AW from the loss of their relationship with Pura Vida.
What about libel?
What about libel, indeed? While the initial emails included false information – and therefore might be libelous – most of what’s in the final article is simply misleading rather than flat-out lies. For example, Ms. Howell focuses extensively on the fact that AW kept repeating an estimate made by environmental engineer David Russell that the Ecuador cleanup might cost $6 billion, after Russell disavowed the estimate:
In his opinion [Judge] Kaplan faulted Amazon Watch for continuing to use a “flawed” $6 billion estimate to “attempt to convince Chevron that it was facing multibillion-dollar exposure in Ecuador and that the time had come to settle.”
Ms. Howell included part of the response to this (my statement that “Judge Kaplan did not make a factual finding that the cleanup would in fact cost less than $6 billion. In fact, the Ecuadorean court found that it would be more expensive than this”), but still left out some key facts that I had emailed her:
Kaplan’s opinion indicates that – a year before he told AW to stop using his damages estimate – Russell “left the LAP team . . . because, among other reasons, the LAP team owed him money and refused to pay it.” If you had investigated this, you would also learn that, in his trial testimony, Russell admitted “that after the consultant underwent a falling out with Donziger, Russell turned around and offered his services to Chevron.” (www.bloomberg.com/bw/articles/2013-10-18/a-swag-surprise-in-the-19-billion-chevron-case). So, you have a consultant who, while he was working for Donziger, did in fact prepare a $6 billion cleanup cost estimate. Then he has a dispute with Donziger over money, he quits, offers his services to Chevron, and disavows his earlier estimate. And you’re suggesting that AW’s funders are supposed to think they did something wrong by ignoring Russell’s about-face and continuing to use the estimate he had prepared? To be clear, Kaplan made no findings about whether Amazon Watch knew or believed Russell’s estimate to be false; Amazon Watch was not a party to the Chevron v. Donziger trial.
Even though she did not report the full story, which had been pointed out to her in advance, Ms. Howell’s writing here is probably not libelous; it’s just biased reporting.
But other statements are more problematic. Ms. Howell writes that “an analysis produced by the accounting firm KPMG concluded that Mr. Donziger’s team and his funders donated over $500,000 to Amazon Watch.” As far as I can tell, that’s pretty clearly wrong. The KPMG accountant, Troy Dahlberg, submitted testimony that he had “confirmed” payments of $11,181 to AW from the attorneys, and had found some “evidence” of additional payments of $243,173 for which there was no hard evidence. I don’t know what the real figure is, but I have no idea where Ms. Howell got her numbers. As far as I can tell, that’s false.
Is it libelous? The law breaks libel down into falsehoods that actually harm someone’s reputation, and “libel per se” – false statements that are so bad they are presumed to cause harm. This might not be libel per se, because – even though Ms. Howell clearly intended to imply that this is scandalous – there’s actually nothing wrong with AW accepting any amount of funds from the Donziger and other lawyers. If, however, it causes some harm to AW (such as if a funder withdraws its support), then Ms. Howell might be liable.
There’s another statement, though, that’s far worse:
“Amazon Watch is a key player in a fraudulent scheme concocted by a group of lawyers in an attempt to extort billions of dollars from Chevron. They have been paid to promote knowingly false and misleading information about the company to the media, the U.S. Securities and Exchange Commission and government officials in an effort to pressure Chevron into a settlement,” said Morgan Crinklaw, a spokesman for the oil giant.
Now, if that’s false (and everything that I know leads me to believe it is), it’s libel per se. It doesn’t actually matter that Ms. Howell is quoting a Chevron spokesperson. As one newspaper handbook explains, “The fact that a person is quoted accurately is not in itself a defense to a subsequent libel action, if the quoted statement contains false information about someone.” The reporter and newspaper are liable for repeating the false statement. That’s especially true here, because the falsity of the statement was pointed out to Ms. Howell before she published, so it was deliberate.
To be clear, there’s absolutely nothing wrong with “an effort to pressure Chevron into a settlement.” And in the only legal proceedings that Amazon Watch actually participated in, a federal court found that ” Even if this Court assumes that Amazon Watch was the mouthpiece for [Steven Donziger], there is nothing to suggest that Amazon Watch’s campaigns and speech were more than mere advocacy and were likely to incite or produce imminent lawless action. . . . All that Chevron has shown this Court is that Amazon Watch has been very critical of Chevron’s operations in Ecuador.” Ms. Howell knew this, because I told her.
From the beginning of Chevron’s campaign against the Ecuador case, they have argued that the entire case is a “fraudulent scheme,” as Crinklaw states. They weren’t willing to try to prove it at trial, though. While they did try to prove that Steven Donziger had committed misconduct, they made no attempt to show that Chevron was not responsible for massive contamination in Ecuador.
Amazon Watch’s campaign against Chevron would only be illegitimate if they knowingly said false things, or if they knew that the whole campaign was an effort to pressure into settling pollution claims that were false. As noted above, the best that AW’s critics can do is point to the continued use of a cleanup estimate that 1) was actually issued by the scientist that they attributed it to; 2) was asked to be withdrawn after a dispute over payment of the scientist’s bill, after which he switched sides; and 3) was ultimately less than found by the Ecuadorean courts. And the pollution claims aren’t false; no court has even suggested that they are.
So, shocking as it may be, we’ll continue to stand by Amazon Watch – along with pretty much everyone else.
Photo CC by faungg