Chevron prevails in Ecuador pollution battle at US Supreme Court

Pierre Vaugeois
Juin 20, 2017

Attorney Steven Donziger had claimed a federal appeals court had exceeded its authority by letting CVX use a USA racketeering law to block enforcement of Ecuador's $8.6B award, but the appeals court said Donziger and his team of lawyers engaged in "a parade of corrupt actions". Judge Kaplan said the case had been corrupted by American lawyer Steven Donziger and Ecuadorean lawyers, who allegedly submitted fraudulent evidence and coerced and bribed an Ecuadorean judge to rule in their favor in 2011.

An Ecuadoran court in 2001 held the oil giant responsible for the incident and ordered it to pay $8.6 billion in damages.

The Supreme Court's action appears to end one tumultuous chapter in the fight - but does not stop the fight itself.

"The facts of the Ecuadorian judicial extortion scheme and the illegality of the plaintiffs' lawyer misconduct have been finally and conclusively affirmed by the legal system of the United States", R. Hewitt Pate, Chevron's general counsel, said in a statement. "Today's decision is an important step toward bringing this illegal scheme to a final conclusion". Ecuadorian authorities had certified Texaco's successful cleanup, according to Chevron.

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Shares of Chevron were lower during late-morning trading on Monday.

Chevron sued against Donziger, alleging racketeering and evidence fabrication.

In the decades-long legal battle, Ecuadorian villagers had argued that from 1964 to 1992 Texaco - which was later purchased by Chevron - dumped polluted wastewater into open pits across vast swaths of Lago Agrio in the Ecuadorian jungle, contaminating the water used by locals.

The lawsuit, based in the Ecuadorean town of Lago Agrio, became an worldwide cause célèbre and the subject of a 2009 documentary film, "Crude". One scene showed the team working with a court-appointed technical expert, Richard Cabrera, who was supposed to be neutral.

In March 2014, U.S. District Judge Lewis Kaplan sided with Chevron, saying Donziger and his colleagues had obtained the judgment against Chevron through fraud.

Chevron in 2011 sued Donziger in the U.S. District Court for the Southern District of NY, accusing him and his colleagues of running an extortion scheme.

The judge blocked the fine against Chevron, a decision upheld by August's appeals court decision and Monday's denial at the Supreme Court.

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