The latest is Michael L. Dourson, Trump's pick to head the EPA's Office of Chemical Safety and Pollution Prevention, the government's chemical safety program. Media reports reveal that the toxicologist is under intense scrutiny for his extensive ties to the chemical industry and a resumé dotted with some of the biggest names in the field: Koch Industries Inc., Chevron Corp., Dow AgroSciences, DuPont and Monsanto.
Three California municipalities filed lawsuits Monday against 37 of the world's biggest fossil fuel companies, including Chevron, Exxon and Royal Dutch Shell. The legal challenges, brought by Marin and San Mateo counties and the city of Imperial Beach, allege that the companies knew about the harm of burning fossil fuels and therefore should pay for current and future damages to the municipalities due to climate change.
New research claims that just 100 fossil fuel producers are to blame for 71 percent of industrial greenhouse gases since 1988, the year human-induced climate change was officially recognized through the establishment of the Intergovernmental Panel on Climate Change (IPCC).
Despite the landmark establishment, the oil, coal and gas industry has expanded significantly and has become even more carbon-intensive since 1988, according the 2017 Carbon Majors report from the environmental not-for-profit CDP.
The U.S. oil giants worry that the bill, which overwhelmingly passed the Senate 98-2 last month, could shut down oil and gas projects around the world that involve Russian partners, according to Market Watch.
By Kathy Mulvey
In preparation for their annual meetings on May 31, both Chevron and ExxonMobil opposed every climate-related resolution put forth by their shareholders. In a previous post, I wrote that Chevron continues to downplay climate risks while attempting to convince shareholders that the company's political activities—which include support for groups that spread climate disinformation—are in shareholders' long-term interests.
Cleanup efforts are underway after a failed Chevron Corporation pipeline released about 4,800 gallons of oil into an intermittent stream on public land in northwestern Colorado and killed some wildlife.
The breach happened on Bureau of Land Management (BLM) land and was first detected on March 5 by a Chevron consultant. The pipeline was shut down after discovery of the leak and the oil is now trapped in a berm and siphon dam in a dry ravine, according to the Associated Press.
As it happens, the leak occurred around the same time that the conservation group Center for Western Priorities found that Chevron was behind 31 reported spills in Colorado last year, ranking the energy corporation as the fourth highest oil and gas spiller in the state.
2016 Colorado Oil and Gas Toxic Release TrackerCenter for Western Priorities
Chevron spokeswoman Erika Conner said that while there are no public health concerns after the March 5 incident, some animals have died. Two mallard ducks covered in oil were found at the spill site and were transferred to Colorado Parks and Wildlife on March 5 but died the day after. Two other small birds and several mice have also been found dead by cleanup crews.
"The U.S. Fish and Wildlife Service has been notified," Conner told The Daily Sentinel. "We regret the impact the release has had on the affected animals and are working diligently to avoid any additional impacts to wildlife."
Colorado Department of Natural Resources spokesman Todd Hartman told the AP that the failed section of pipeline is being analyzed to determine a cause.
The spill involved a 6-inch-diameter oil gathering pipeline, BLM spokesman David Boyd told The Daily Sentinel.
In its recent report, the Center for Western Priorities calculated available data from the Colorado Oil and Gas Conservation Commission and determined there were 509 reported spills in 2016—that's more than one a day in Colorado.
The number of spills in 2016 are less than the 615 reported spills and incidents in 2015, reflecting the decrease in drilling activity. However, the group expects spills to increase as the state ramps up oil and gas production.
"As drilling and production increase in Colorado—which is expected as the price of oil and gas may increase in the coming years—we also expect to see spills increase," the report said. "Monitoring these incidents help to inform Coloradans about the impacts of oil and gas development within the state."
In response to the report, Chevron said in a statement that it "aggressively manages the risk of spills through a rigorous ongoing asset integrity program wherever we operate."
"For example, Chevron has undertaken a comprehensive, multi-year, multi-million-dollar project to streamline and upgrade facilities and systems at our largest Colorado asset in Rangely," the company continued. "The program will continue through 2018. To date, approximately 11 miles of pipes have been removed from service."
In the wake of a controversial U.S. court ruling that a $9.5 billion Ecuador judgment against Chevron is fraudulent, the oil giant has been touting loudly its innocence of any environmental crimes in the South American country.
Chevron's lawyers even successfully pressured some CBS News corporate suits to yank a damning 60 Minutes piece from the network's website about the deliberate contamination of the Ecuador rainforest from 1964 to 1992 by Texaco, which Chevron later bought.
(See the dead link here. You can see the segment on my company's web site. So sue me, CBS.)
Instead of succumbing to Chevron's pressure tactics, CBS' lawyers should grow a backbone and demand to see contamination "playbook" documents that Chevron has been forced to produce in an international arbitration proceeding.
They are explosive and prove 60 Minutes got it right, and the U.S. judge got it wrong.
The playbook details how the company hid evidence of contamination during an eight-year Ecuador trial resulting in a $9.5 billion damage award that the Ecuadorians are waiting for Chevron to pay.
Meanwhile, Chevron is claiming in arbitration that the Republic of Ecuador should pay the judgment, and the two parties are duking it out before a panel of corporate trade lawyers who rent office space at The Hague and act as "judges"—more about them later.
The playbook took center stage in a recent arbitration filing by Ecuador. It appears the country's lawyers have gotten their hands on much of, if not the entire, playbook, but the corporate trade lawyers are requiring Ecuador to redact or cover up the really damning evidence.
Even so, a recent rejoinder filed by Ecuador reveals enough to demonstrate what a morally bankrupt company Chevron is.
Here's what we know about the playbook, pieced together from the filings of both the Ecuadorians in U.S. court and the Republic of Ecuador in arbitration.
In 2011, the Ecuadorians obtained a few pages from the playbook and tried to enter them into evidence during Chevron's "fraud" trial, but Federal Judge Lewis Kaplan refused to allow any evidence of contamination into the record, including the small excerpt from Chevron's playbook.
During the Ecuador trial Chevron's paid experts wrote the playbook to document how to handle the contamination they found at the well sites in soil and water tests.
Without the knowledge of the Ecuador court, Chevron's experts conducted unofficial and secret pre-inspections of the sites so they could avoid the badly contaminated areas during the official judicial inspections. (page 63 in the rejoinder)
Their pre-inspection findings would have been devastating to their case had they been turned over to the court. So they never were. (page 63)
Instead, they used the results to avoid the contaminated areas and test at clean spots, usually from soil and water at elevations higher than the huge, unlined and open pits Texaco built to store permanently pure crude and toxic water.
Quick backgrounder: Texaco explored for oil in Ecuador from 1964 to 1992 and was the sole operator of the well sites during that time. The Ecuadorians filed their original lawsuit in the U.S. against Texaco in 1993, one year after Texaco left Ecuador. A U.S. judge dismissed their lawsuit ruling in 2001 at Texaco's urging the litigation should be heard in Ecuador. That year, Chevron bought Texaco. In 2003, the Ecuadorians re-filed their case in Ecuador but not before the U.S. 2nd Circuit Court of Appeals instructed Chevron that it must accept Ecuador's jurisdiction, which it did.
Chevron routinely used deceptive methods, such as mixing clean soil with dirty and undercounting hydrocarbons, to hide or reduce toxic chemicals in samplings. (pages 66-72)
This table below, taken from the arbitration filing, reflects just a few of the thousands of pages of playbook notes Chevron's experts and field personnel took, describing the contamination and advising the company about ways to avoid it during the official judicial inspection:
It's heavily redacted. If it's true—as Chevron says it is—that the oil giant is innocent, and the truth is what it seeks, then why won't Chevron release the un-redacted, unedited playbook for all to see?
Maybe it has something to do with the 1995 remediation agreement that Chevron argues is its get-out-of-jail-free card.
The agreement, between Texaco and the Republic of Ecuador, released Texaco from government liability in exchange for a cleanup of a relatively small number of pits. It did not, however, release Texaco from third-party claims.
During the Ecuador trial, tests found contamination levels at the so-called remediated Texaco pits as high or higher than the ones not cleaned. The Ecuadorians accused Texaco of simply throwing dirt on top of the contamination to hide it.
Chevron's playbook backs that up.
At pits Texaco said it cleaned, Chevron—according to its own playbook—found contamination during its secret pre-inspections. To avoid or reduce the contamination Chevron, during the official judicial inspection, took soil only from the top layer.
Ecuador's rejoinder references the playbook notes of Shushufindi 24, Sacha 21 and Lago Agrio 6, all three well sites that Texaco said it cleaned.
In its secret, pre-inspections Chevron discovered otherwise. (pages 68-69)
The rejoinder reads: "During the JIs (judicial inspections) Chevron's experts sought to avoid finding pollution by sampling only to depths that it knew to be clean. For example, at Shushufindi 24, the soil boring log at pit 2 shows that during its PI, (pre-inspection) REDACTED "Then at the JI, Chevron strategically chose to take surface soil samples only—avoiding the known contamination below."
Chevron: What did you find at Shushufini 24, Sacha 21 and Lago Agrio 6?
If you found little or no contamination, then all is well. If you found contamination and withheld it from the court, then your remediation agreement comes unraveled as does your entire legal case.
Chevron will say today that pre-inspections were allowed, but that's not what its attorneys said during the trial. Chevron wrongfully accused the Ecuadorians of pre-inspections, telling the court that pre-inspections were a "violation of legal security and due process of law," and "no technical team from ChevronTexaco Corporation has performed any secret tests here."
The rejoinder reads:"Yet by that time, Chevron's experts had conducted PIs at least REDACTED (number of) sites and taken over REDACTED (number of) samples." (page 65)
Chevron wants its shareholders to believe the Ecuadorians are history, even though enforcement lawsuits are underway in three countries and an appeal of the U.S. ruling is pending before the Second Circuit Court of Appeals, which reversed an earlier Kaplan attempt to stop enforcement of the Ecuador judgment.
And, while the Republic of Ecuador is aggressively fighting Chevron's arbitration claim, it is doubtful the arbitration panel will rule against the oil giant.
Brought in 2009, Chevron's arbitration action is based on alleged violations of Ecuador's Bilateral Trade Agreement with the U.S.
For some time now, multi-national corporations have been abusing these trade agreements. Allowing it to happen are the corporate trade lawyers who sit on arbitration panels as judges and then rotate off as lawyers representing corporations before panels composed of their trade lawyer buddies.
Best example is the successful claim by Phillip Morris against Australia because the country placed warning signs on cigarette packs about the dangers of smoking after Phillip Morris began selling cigarettes there.
International arbitration is fraught with serious conflicts of interest, and some countries are considering ending bi-lateral trade agreements due to numerous upside down arbitration rulings that have put the interest of corporations above a country's residents.
The Ecuadorians' best bet is in Canada, Brazil and Argentina where they have filed enforcement lawsuits to seize Chevron's assets in those countries as payment for the judgment.
Who knows? The entire Chevron playbook may see the light of day in one of those courtrooms soon. Or, 60 Minutes could stand by its work and demand to see it.
Ironically, during Chevron's "fraud" trial, Kaplan quoted former Supreme Court Justice Louis D. Brandeis' famous maxim that "sunlight is said to be the best of disinfectants" but when it comes to the allegations leveled by the Ecuadorians and their lawyer, Steven Donziger, Kaplan and the corporate trade lawyers hanging out at the Hague prefer the dark side of the moon.
By Adam Chimienti
“This is the Court of Chancery … which gives to monied might the means abundantly of wearying out the right, which so exhausts finances, patience, courage, hope, so overthrows the brain and breaks the heart …" — Charles Dickens, Bleak House
The court proceedings in the case of the 21st century, between multinational oil giant Chevron and the Ecuadorian Amazon communities affected by oil contamination, are reminiscent of the muddled legal saga around which Dickens' Bleak House is centered. As with the parties in the 1853 novel, the plaintiffs have been denied justice over the course of many years. Their plight will continue into 2014.
Of course, this could've been the year when one of the world's most profitable corporations realized that it was no longer worth dragging its feet and finally figured out a way to rectify the damage that Texaco (acquired by Chevron in 2001) committed while exploiting the major oil reserves in the country beginning in the late 1960s.
This could've been the year when U.S. judges rebuked Chevron and discouraged any further attempt to deny the damage the company is responsible for.
This was the year when Ecuador's Supreme Court reduced the judgment back to the original amount of $9.5 billion, less the punitive damages applied after Chevron refused to apologize.
This was also the year when proceedings in other countries took some interesting turns, like the recent decision in the Ontario Court of Appeal, lifting the hopes of the affected populations. This latest ruling, which overturned an earlier decision that Chevron Canada's assets are not directly owned by the U.S. corporation, will likely result in the case being brought before the Supreme Court of Canada.
Chevron relies on armies of lawyers and its allies in the press to confound the issues. Yet, in this peculiar case, there is so much more than meets the eye. For example, Chevron has capitalized on the Ecuadorian government's hypocrisy when it comes to environmental matters. In 2013, it became increasingly evident that the progressive environmental language in the 2008 constitution is not nearly as essential as the extractive agenda of President Rafael Correa's administration.
This 21st century struggle reveals what is and what is no longer possible in the battle over resources and life, between the excessively wealthy and their victims.
Here are eight essential elements of the case you should understand.
1. The History of Texaco in Ecuador
Texaco was first invited to Chevron in the early 1960s and began exploring for oil in 1964 in the Lago Agrio region of northeastern Ecuador. During roughly two decades of extraction and major profits, a consortium initially consisting of Texaco and Gulf Oil, with a 25 percent share later acquired by the Ecuadorian state oil company, CEPE (now Petroecuador) built a pipeline to carry crude across the Andes for export. Texaco, which was widely regarded as a world leader in the oil business, did not use costly techniques such as re-injecting wastewater underground. Instead, much of its waste was pumped into unlined pits and crude oil was poured everywhere, including the streets of Lago Agrio.
In the late 1980s, several earthquakes would cause extensive damage to the pipeline and lead to organizing efforts by indigenous groups and environmental activists. Those living near the oil-drenched forests were emboldened by support they received throughout the country and around the world.
These complex networks developed quickly and in November 1993, shortly after Texaco departed the South American nation, affected Ecuadorian citizens began to seek legal action in New York. That first lawsuit was eventually thrown out due to jurisdictional matters. Despite complaints by the plaintiffs that Ecuador's courts were ill equipped to handle such a case, Texaco, then acquired by Chevron in 2001, was happy to have the case moved to Ecuador and praised the court system there in a series of affidavits. The New York court required that the oil giant submit to the jurisdiction and judgment of the Ecuadorian court, although many argue Chevron believed it would be successful in controlling the outcome there.
2. The Record Judgment
The new case Aguinda vs. Chevron began in May of 2003 and ended Feb. 14, 2011, when the Lago Agrio court found Chevron guilty of the contamination and required an apology. The $8.6 billion for an environmental remediation and services to address the various needs of the communities, based largely on a 1999 study by the Spanish doctor Miguel San Sebastian, doubled to more than $18 billion after the company failed to apologize, and later increased to $19 billion in July 2012.
Chevron has repeatedly stated that the plaintiffs will never receive a dime of the company's vast assets, estimated at around $244 billion. The firm has spent significant sums of money fighting the judgment it believes is fraudulent, asserting that the state oil company is responsible for the remaining pollution in the forest.
Most recently, the judgment has been cut in half to $9.5 billion by the Ecuadorian Supreme Court. Meanwhile, the Lago Agrio judge who passed down the verdict in 2011, Nicolas Zambrano, has been depicted as corrupt for allowing the verdict to be ghostwritten in return for an alleged $500,000 kickback from Donziger's legal team. Chevron's star witness Alberto Guerra, the former judge who presided over the case and now claims he helped negotiate the bribery scheme involving Zambrano, corroborated this claim. Hardly credible himself, Guerra has admitted to extensive bribery schemes in the past and is now openly being paid by Chevron to live in the U.S. with “$10,000 a month in living expenses, a $2,000 monthly housing allowance, health insurance coverage for himself and family members, a leased automobile, payment for an independent attorney, payment for an immigration attorney and moving expenses."
3. The Legal Proceedings
There are now six cases in as many countries and on three different continents.
- The original Aguinda vs. Chevron case recently made its way before the Ecuadorian Supreme Court where the judge removed the punitive damages, cutting the judgment by half. Chevron has no assets in the country and therefore the plaintiffs are forced to look elsewhere to seize company property to sell.
- The first attempt to seek assets abroad was in the Ontario Superior Court in Canada. In early May of this year, a Canadian judge found that the subsidiary, Chevron Canada, could not be subject to the Ecuadorian ruling. However, a three-judge panel in the Ontario Court of Appeal overturned the decision in December. Justice James MacPherson drew attention to the confidence of Chevron, referring to a comment about the company's willingness to “fight this until hell freezes over" and then “fight it out on the ice." The Canadian judge then wrote, “Chevron's wish is granted. After all these years, the Ecuadorian plaintiffs deserve to have the recognition and enforcement of the Ecuadorian judgment heard on the merits in the appropriate jurisdiction. At this juncture, Ontario is that jurisdiction."
- The Argentine Supreme Court also weighed in on the matter, overturning a lower court's decision to freeze Chevron Argentina's assets there, thereby clearing the way for a major shale oil investment by Chevron. Plaintiffs have indicated they would appeal this ruling.
- Brazil's Superior Tribunal of Justice is also considering the case, although Chevron's extensive production there (33,000 bpd of crude) is a factor.
- Chevron vs. Donziger et al, is a racketeering or RICO case that was heard from Oct. 15 through late November in the Southern District of New York. Steven Donziger, the lead adviser to the Ecuadorian plaintiffs in Aguinda-turned defendant, unsuccessfully attempted to get Kaplan removed for bias and now the U.S. judge is set to deliver his verdict in early 2014. This case has already featured remarkably broad subpoenas including access to email data from firms such as Google, Microsoft and Yahoo!, 600 hours of video footage from an award-winning documentary, and a failed attempt to acquire environmental NGO Amazon Watch's internal documents and testimony. Donziger's legal team will likely appeal the unfavorable verdict they expect to the U.S. Court of Appeals for the Second Circuit.
- Finally, the Permanent Court of Arbitration at the Hague is hearing Chevron vs. Ecuador to determine whether Ecuador's government should have intervened to stop the Aguinda trial from proceeding due to a Bilateral Investment Treaty (BIT) signed with the U.S. in the 1990s. The Ecuadorian government points out that the treaty was signed in 1993, went into effect in 1997 and can not retroactively apply to the damages caused by Texaco when they left the country in 1992.
There may soon be additional litigation before courts in Colombia, Panama and Venezuela.
4. The Lawyers
Steven Donziger has been the lead adviser for the plaintiffs since the first trial in New York against Texaco. The Manhattan attorney, once a basketball cohort of President Obama, is depicted as having an ego that may be too big for his own good. He is often the most high profile name directly involved in the case, serving as a lightning for Chevron and its supporters in the financial press. Paul Barrett, a chief reporter for Bloomberg Businessweek, who recently finished up a book on the trial, also finds Donziger a colorful character through which to explain this case. Unfortunately, this focus ignores many of those whose lives have been deeply affected.
It appears much more difficult for Chevron to malign the name of the lead attorney for the plaintiffs, Pablo Fajardo. Along with his Ecuadorian colleague Luis Yanza, Fajardo won the Goldman Environmental Prize in 2008 and he was the CNN “Hero of the Year" in 2007. Both Fajardo and Yanza hail from the Oriente and have spent much of their lives in communities that have been affected by irresponsible oil drilling practices.
Meanwhile, Patton Boggs, a prominent U.S. law and lobbying firm, joined the plaintiffs' legal team in early 2010. They immediately began planning the best way to effect a settlement but that seems unlikely. In fact, the battle has only become nastier as Gibson Dunn, Chevron's LA-based firm retained in 2009, has portrayed Patton Boggs and the entire Ecuadorian legal team as guilty of defrauding Chevron. One legal ethics expert pointed out that, “Patton Boggs is a firm of recognized standing. This is accusing them of fraud, and that's going to be bitterly fought."
5. The Media and the Documentarian
Donziger also worked to attract allies through media outlets. His strategy was to land favorable coverage in major news outlets such as BBC Newsnight, 60 Minutes and others. In 2007, the Vanity Fair's annual “Green Issue" featured a lengthy piece about the case attracted celebrities and other moneyed interests to the cause. Some notable entertainers, such as Sting and his wife Trudie Styler, have remained involved and continue working on related environmental issues in Ecuador.
However, this strategy backfired somewhat when the 2009 documentary Crude, directed by Joe Berlinger, produced unintended consequences. Throughout much of the footage and in the final film, Donziger was again a focus and the attorney had a bad habit of embarrassing, if not potentially incriminating, himself on camera. In one troubling scene, the international NGO Amazon Watch's founder Atossa Soltani responds to a plan by Donziger to assemble an “army" (Soltani points out that this is an especially troubling term in military coup-plagued Ecuador) of protesters. She asks about the likelihood of Berlinger's video footage being subpoenaed saying “I just want you to know it's illegal to conspire to break the law." Donziger more or less dismissed her concerns about possible subpoenas, yet within months, Chevron had obtained the footage and their own high-priced army of lawyers set about examining and distributing it.
Well-versed in public relations itself, Chevron created its own views and opinions website devoted to the case, which served as a blog/aggregate for news reports and right-wing commentary. Forbes (where Donziger himself was published), The Wall Street Journal, Bloomberg Businessweek, Fortune (CNN), and other publications that followed the case tended toward Chevron's side of the story, while other major news outlets like The New York Times, Washington Post and San Francisco Chronicle are more nuanced in their approach.
6. The Governments
One of Chevron's main contentions is that Texaco's agreement to remediate its share of concessions with the Ecuadorian government in the mid-1990s exonerates the multinational from any environmental damages. These arrangements took place under President Sixto Duran Ballen, a dual U.S./Ecuadorian citizen who had been advancing neoliberal reforms begun in the previous decade. Many Ecuadorian observers close to the case believe the Duran Ballen government's numerous corruption indictments effectively nullified the remediation and note that Chevron was released before remediating a single site. Furthermore, as many critics of neoliberalism have pointed out, the Washington Consensus and the conditional assistance programs from International Financial Institutions (IFIs) came about as a result of coercion and corruption often involving the U.S. and other Western governments.
In the early 1970s, Henry Kissinger, fresh from his role in “making the Chilean economy scream", was personally involved in negotiations and disputes between the Texaco consortium and the government in Quito. At that time, the military regime in power depicted itself as revolutionary and nationalist, promising progressive policies. Coinciding with a shift to markedly increased dependence on the oil sector, oil prices began an upward climb that would last into the early 1980s. Since Ecuador was one of the newest and smallest members of OPEC at the time, it perceived a hostile approach on the part of the U.S. government and feared it was going to be made an example of for other countries.
Three decades later, a lobbyist for Chevron would argue that "We can't let little countries screw around with big companies like this-companies that have made big investments around the world." A la Dickens, this corporate mentality obscures the more compelling realities of this case.
7. The Scientists
In early 2013, Chevron claimed a victory when the Colorado-based scientific consulting firm Stratus withdrew their support for the plaintiffs. The environmental experts disavowed the environmental damages assessment conducted by Richard Cabrera. In his role as an independent court-appointed expert, Cabrera was reportedly in close contact with the plaintiffs and their allies at Stratus and this was corroborated by videos subpoenaed from Berlinger. Cabrera's report, allegedly ghostwritten by the plaintiff's allies, is portrayed as lacking in requisite scientific credibility.
Considering the immense destruction of Amazonian habitat, such an assessment may not even be possible. Kelly Swing, a professor working via Boston University in a research station in Yasuni National Park, offered among the most poignant explanations I have heard regarding oil contamination in northeastern Ecuador. Swing explained to me that this region is among the most biodiverse, or megadiverse, in the world. This is due to the Andean-Amazon corridor (with it's abundance of fresh water) as well as the proximity to the equator.
Look at a map however, and you'll quickly notice that the section of Yasuni where Dr. Swing and others are doing their research is well over 100 kilometers south of the equator, meaning that the richest biodiversity in Ecuador (and the world) was likely in the same region that was first reached by missionaries and then oil companies. “We may have already lost the pinnacle of species [near Lago Agrio] without even noticing," Dr. Swing lamented.
Confounding the situation, the government in Quito announced this summer that it has no choice but to move ahead with oil exploration in Yasuni, sparking widespread protests from students, environmentalists and indigenous organizations. Under the Correa Administration, poverty has declined significantly as a result of increased social spending. However, in exchange for what amounts to under two weeks worth of global oil usage in Yasuni's reserves, many more hectares of Ecuador's remaining virgin rainforests will be compromised if the government proceeds with its ambitious extractive agenda.
8. The Affected Population
At a press conference in the Amazon in September, Ecuadorian President Rafael Correa, held up an oil-soaked hand and addressed the camera as if there were Chevron executives directly behind it:
“I believe that this is an exemplary case, not only of the injustice but of the immorality of the world order, world institutions, where everything is on the side of capital, where there is a total supremacy of capital, of multinationals over people, over societies, over nations, and this inspires us and drives us and helps us to see much more clearly the mission to reform this world order as much as possible to be on the side of justice."
While this sounds impressive, many of the affected in the Lago Agrio region direct their complaints at state-owned firms Petroecuador and Petroamazonas. Several farmers in the region explain that water is the most critical issue facing the people of the Lago Agrio region. Many believe that the government isn't seriously addressing the contamination despite the government's own irresponsible practices.
A question remains: Is the Correa administration, celebrated as progressive around the world, simply another government that puts the rights of indigenous peoples and the environment after the needs for capital and investment? Many activists here would say yes.
While the Ecuadorian government now appears ready to use its resources to join in the plaintiffs' struggle, its critics can't help but notice that these efforts come on the heels of the controversial decision to move forward on exploiting the oil blocks in the Yasuni-ITT region. It is likely that the government will have considerable difficulty maintaining the guarantee that state oil companies or their foreign partners can avoid causing similar damage to the people and habitats of the rainforest. Factored alongside various other environmentally destructive megaprojects being planned or carried out to advance development, such political moves and cynical attitudes are to be expected.
Ecuador, like many other developing countries, is in a difficult position regarding its own future. Its government, despite the revolutionary rhetoric and unorthodox views of its leftist president, is mired in the paradigm of extracting and exporting natural resources with all its attendant problems. Texaco, in its decision-making several decades back set the stage here for a long, drawn-out tragedy. An increasing dependency on fossil fuels, will wreak further damage that cannot be quantified nor qualified. Genuine remediation is a rather difficult goal to achieve.
In a visit to New York in September, Ecuador's Minister of Minister of Foreign Affairs Ricardo Patino recently argued that ChevronTexaco is responsible for the destruction of the vast swaths of rainforest and diseases and deaths of many Ecuadorians. These are serious charges. Chevron will continue to convey the message that this is all a scheme by Ecuador to extort funds from its famously deep pockets. These statements demonstrate for posterity how legal battles over environmental destruction fall far short of responsible action and how complex arrangements within the highly centralized corporate/nation-state structures plague the periphery.
Today, debates about fracking, tar sands, exploiting oil in extreme locations such as the Arctic and the future of nuclear energy are unavoidable. The enduring lesson from the willful destruction of the Ecuadorian Amazon will prove to be more about a system of capital, extraction and laws that is thoroughly flawed and broken. It is clear that the system is currently incapable of remediating the destruction it makes. Just what would Dickens make of this bleak 21st century story?
Indigenous and farmer communities in Ecuador scored a major victory over Chevron yesterday when an Ontario appeals court ruled they have the right to pursue enforcement of a $9.5 billion Ecuadorian court judgment against Chevron's assets in Canada.
The court also ordered Chevron's two Canadian subsidiaries to pay $100,000 in costs to the Ecuadorians.
"After all these years, the Ecuadorian plaintiffs deserve to have the recognition and enforcement of the Ecuadorian judgment heard in an appropriate jurisdiction," said the decision issued by a three-judge panel of the Court of Appeal of Ontario. "At this juncture, Ontario is that jurisdiction."
The decision was lauded by the leaders of the Ecuadorian communities and their lawyers.
"This order will allow us the opportunity to hold Chevron accountable for fleeing the scene of its environmental crimes in Ecuador after a valid judgment was entered against it," said Pablo Fajardo, the lead Ecuadorian lawyer for the villagers.
Humberto Piaguaje, a Secoya indigenous leader who is the director of the Assembly of Affected Communities, said: "This decision is momentous. It proves Chevron cannot hide behind legal technicalities to avoid justice."
Members of roughly 80 indigenous and farmer communities in Ecuador's northern Amazon region, the villagers won their judgment in 2011 after a hotly-contested eight-year trial that Chevron insisted take place in the South American nation. But Chevron has refused to pay the judgment and has stripped most of its assets from Ecuador to avoid collection, forcing the villagers to file lawsuits to satisfy the judgment in places where Chevron has assets.
The Ecuadorians have launched such proceedings in Brazil and Argentina as well as Canada.
Just last month, Ecuador's Supreme Court affirmed the finding of liability against Chevron but cut the damages amount roughly in half, to $9.5 billion. By contrast, BP's liability for the relatively smaller Gulf of Mexico spill is approaching $40 billion.
Rainforest Action Network
The Canadian appellate panel took wry note of Chevron's long history of forum shopping, citing the company's earlier promise to U.S. courts to abide by any adverse judgment in Ecuador as a condition of the case being moved there in 2001. The Ontario court also took a veiled swipe at U.S. federal judge Lewis A. Kaplan for trying to issue an injunction purporting to block the Ecuador judgment. A U.S. appeals court unanimously reversed Kaplan just last year.
"The picture from the above history is an obvious one," the panel wrote. "For 20 years, Chevron has contested the legal proceedings of every court involved in this litigation—in the U.S., Ecuador and Canada. Chevron even sought, and briefly obtained, a global injunction against enforcement of the Ecuador judgment.
"In these circumstances, the Ecuadorian plaintiffs should have an opportunity to attempt to enforce the Ecuadorian judgment in a court where Chevron will have to respond on the merits," the panel ruled.
The panel ruled that jurisdiction over Chevron in Canada "properly opens the door to this hugely significant decision of Ecuador's highest court possibly being recognized and enforced in a jurisdiction, Ontario, where enforcement may be significant to the parties."
The latest decision represents a stunning reversal of fortune for the oil giant, which just finished a six-week trial in New York before Judge Kaplan where it alleged the Ecuadorian plaintiffs and their lawyers had obtained the Ecuador judgment by fraud. The Ecuadorians assert that Chevron is using the fraud allegations to distract attention from its environmental crimes and growing liability in Ecuador. Counterclaims have been filed against Chevron in the New York case.
Chevron's subsidiaries have an estimated $15 billion of assets in Canada, more than enough to pay for the entire Ecuador judgment which just last month was unanimously affirmed by Ecuador's Supreme Court. The villagers hope to use any funds collected to clean-up the billions of gallons of toxic waste Chevron was found to have dumped in their ancestral lands from 1964 to 1992, when the company operated almost 400 well sites under the Texaco brand.
The decision technically reverses a trial court decision that imposed a stay after finding that the villagers could establish jurisdiction over Chevron, but could not target the assets of Chevron because they were held by wholly-owned subsidiaries. The panel did not make a final ruling on whether the Ecuadorians could seize the assets of subsidiaries to satisfy a judgment against the parent company, saying that issue would have to be decided during the enforcement action.
"The appellate decision represents a significant step forward in the two-decade battle by Ecuadorians for justice against one of the world's most profitable corporations," said Anton Tabuns, a Canadian lawyer who represents the villagers.
"We look forward to moving into the merits of recognizing the legitimate judgment from Ecuador in Canada," he said. "Chevron's two-decade history of forum shopping and obstructionism must end now."
Chevron is expected to appeal the ruling to Canada's Supreme Court, but it is unclear whether that appeal—even if accepted—will stay the enforcement proceeding. Under Canadian law, enforcement proceedings are heard by a judge and not a jury.
The trial court decision in Ecuador, which came down in 2011, was based almost entirely on Chevron's own scientific evidence documenting the company's substandard practices. In addition to dumping billions of gallons of toxic waste water into the environment, the company abandoned more than 900 open-air toxic waste pits gouged out of the jungle floor. Rates of cancer in the area where Chevron operated have skyrocketed, according to evidence before the Ecuador court.
In Canada, each party had been given three hours to make their case during oral argument in October, underscoring the significance of the matter to Canadian courts—in the U.S., appellate arguments are often limited to ten minutes.
The latest decision also underscores that the separate fraud action in New York federal court initiated by Chevron will not impact foreign enforcement actions, which take place in accordance with each country's laws where the actions are filed. In the New York case, Judge Kaplan has come under criticism for his displays of bias against the Ecuadorians.
Kaplan, who presided over the case from the bench after Chevron dropped damages claims to avoid a jury, also has no authority to block the Ecuador judgment from being enforced in other countries, according to prior decision of New York's federal appellate court.
Enforcement actions from the Ecuadorians have become a major disruptive influence on the oil giant's operations outside the U.S, which collectively account for approximately 75 percent of the oil giant's annual revenue. In Argentina, a trial court froze part of the revenue stream of a Chevron subsidiary pending a judgment recognition ruling. Though the ruling was lifted, recognition actions against the company both there and in Brazil are ongoing.
In Canada, Chevron subsidiaries can produce anywhere between $2 billion and $4 billion annually in dividends for the parent company, according to estimated by the plaintiffs.
Chevron also has been forced to hire major law firms in Venezuela and Colombia in anticipation of enforcement actions being filed in those countries, according to sources. A Chevron comptroller, Rex Mitchell, recently testified under oath in the New York case that the enforcement actions would cause "irreparable harm" to the company's global operations.
The Ontario judges who signed the order are James C. MacPherson, Eileen E. Gillese and C. William Hourigan.
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