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Ecuador judge orders Chevron to pay $8.6 billion in pollution case

By Matt Glenn

[JURIST] A judge for the Provincial Court of Sucumbios in Ecuador ordered US oil company Chevron [corporate website; JURIST news archive] to pay $8.6 billion in damages, finding that Texaco, which was acquired by Chevron in 2001, polluted large areas of the country's rain forest. Chevron vowed to fight the ruling [press release], calling it "illegitimate and unenforceable" and "the product of fraud." The plaintiffs' lawyer said he also plans to appeal [NYT report], after the court awarded far less than the $113 billion for which the plaintiffs reportedly asked. It is unclear when, if ever, the Chevron will pay the judgment [WSJ report]. Chevron has no assets in Ecuador, and it recently won rulings from a panel of arbitrators [order, PDF] at the Permanent Court of Arbitration [official website] in The Hague and a judgement [order, PDF] in the US District Court for the Southern District of New York [official website] temporarily barring the enforcement of any judgment against Chevron.

Earlier this month, Chevron filed a lawsuit [press release] against plaintiffs' lawyers and consultants in the case, claiming that professionals for the plaintiffs were attempting to extort Chevron. In July, the US Court of Appeals for the Second Circuit upheld [LAT report] a May ruling [NYT report] by the Southern District of New York ordering filmmaker Joe Berlinger to turn over to Chevron certain outtakes from his 2009 documentary Crude [film website]. Chevron claims the outtakes show plaintiffs' lawyers discussing illegal and unethical tactics, including ghost-writing a court appointed expert's report, intimidating a judge and colluding with government officials. Chevron claims to have evidence that the plaintiffs influenced a court appointed expert who, in 2009, recommended Chevron be found liable [Forbes report] for $27 billion. The suit was re-filed in Ecuador [AP report] in 2003 after being dismissed by the Southern District of New York in 1996. Chevron claims that a 1995 cleanup agreement between Ecuador and Texaco that was completed in 1998 at a cost of $40 million absolves Chevron of all liability. Plaintiffs originally filed suit against Texaco, which operated the oil fields from the 1960's until the early 1990's, in the Southern District of New York in 1993.

Full post as published by JURIST - The Paper Chase on February 15, 2011 (boomark / email).