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Ecuadorians: Chevron’s $12b Pollution Liability Will Now Be Decided by Canadian Supreme Court After “Unjust Ruling”

Submitted by: Amazon Defense Coalition - FDA

Categories: Environment, Business Ethics

Posted: May 23, 2018 – 12:50 PM EST

 

TORONTO, May 23 /CSRwire/ - A Canadian appellate court in Ontario today issued a “profoundly unjust” ruling today allowing Chevron to avoid paying a $12 billion pollution judgment owed to Indigenous people in Ecuador simply because it placed its assets in a wholly-owned shell company, said lawyers for the Indigenous peoples who won the environmental judgment in 2013. The appellate decision is unlikely to withstand review by the Canadian Supreme Court, they added.

The Ecuadorians vowed to appeal a decision from the Ontario Court of Appeal to the Canadian Supreme Court, which already ruled unanimously in their favor in 2015 when Chevron tried to block the case on jurisdictional grounds and other technical issues, said Patricio Salazar, the leader Ecuadorian lawyer for the Indigenous plaintiffs. “Canada’s Supreme Court already ruled in favor of the Ecuadorian communities in 2015 when Chevron used a different set of technicalities to try immunize itself from accountability,” said Salazar.

“We will continue to fight not only because of the need to realize environmental justice in Ecuador, but because this decision allows wealthy corporations with creative lawyers to achieve absolute immunity by placing assets in shell companies,” he added. “This decision must be resisted to protect the rights of Indigenous peoples from corporate injustice all over the world,” said Salazar.

“We are disappointed at a ruing that appears to allow a corporate polluter to hide assets in subsidiaries to evade liabilities for environmental harms caused to Indigenous groups and vulnerable communities,” said Luis Yanza, the Ecuadorian community leader who launched the lawsuit against Chevron in 1993. “If allowed to stand, this decision will cause tremendous human suffering in Ecuador and block entry to the courthouse for Indigenous peoples and vulnerable communities around the world.”

The Ecuadorian case – which began in 1993 -- has been broadly supported by Canada’s First Nations movement, which includes more than 600 Indigenous bands. Perry Bellegarde, Canada’s current National Chief who leads the Assembly of First Nations, attended the recent court argument in the case along with Phil Fontaine, the thrice-elected National Chief of Canada. Fontaine visited the impacted area in Ecuador last year along with Canadian Grand Chief Ed John; both were harshly critical of Chevron’s misconduct.

In a speech last month before the United Nations, Canadian Grand Chief Wilton Littlejohn also praised the “historic legal battle” of the Ecuadorian Indigenous peoples to “clean up truly horrendous pollution” left by Chevron on ancestral lands in the rainforest.

Separately, U.S. lawyer Steven Donziger – who has represented the Ecuadorians for 24 years and who has been targeted by a long-running company “demonization” campaign – took aim at the decision, saying the Canadian judges appear to have adopted an erroneous and deeply flawed “racketeering” ruling by U.S. trial judge Lewis A. Kaplan that relied on paid-for testimony from a Chevron witness who later admitted he lied repeatedly on the stand when he claimed Donziger bribed the Ecuador trial judge. Chevron’s misconduct in that case is now the subject of a criminal referral letter to the U.S. Department of Justice. (See here for background on Kaplan’s decision in an article by Greenpeace co-founder Rex Weyler.)

“Respectfully, it is our view that the three judges did not fully own their responsibility to make an independent decision under Canadian law rather than be influenced by a wholly erroneous finding by U.S. trial judge Lewis A. Kaplan, without acknowledging that the U.S. ruling relied on false and paid-for testimony from a Chevron witness who later recanted,” said Donziger. “The Canadian panel essentially let a U.S. trial judge substitute his judgment for their own and in so doing they have thrown up another obstacle to the ability of human rights victims to obtain justice from a private company.

“Our Canadian counsel is confident we will prevail before Canada’s Supreme Court and that’s where our focus will be in the coming months,” said Donziger.

U.S. Judge Kaplan is infamous for noting at the outset of the U.S. proceeding that Chevron was “a company of considerable importance to our economy” and that the Ecuadorian environmental cause was the product of “the imagination” of American lawyers. Kaplan also held undisclosed investments in Chevron during the trial, which was characterized as a “Dickensian farce” by prominent U.S. attorney John Keker prior to withdrawing from the case.

Prior to today’s decision, Chevron had lost three consecutive unanimous appellate decisions in the country after having spent more than two decades and an estimated $2 billion to pay 60 law firms to try to resist enforcement of the Ecuador judgment. After an eight-year trial in Ecuador that produced 220,000 pages of evidence, three layers of courts confirmed that the company deliberately discharged billions of gallons of cancer-causing oil waste into the rainforest when it operated there under the Texaco brand from 1964 to 1992, decimating Indigenous ancestral lands. (See this summary of the evidence against Chevron.)

Chevron, which had willingly accepted jurisdiction in Ecuador to avoid a jury trial in the United States, later vowed never to pay the judgment and threatened the Indigenous peoples with a “lifetime of litigation” if they persisted.

The latest ruling came as a surprise given that Canadian judges had seemed increasingly skeptical of Chevron’s “fraud” defense after evidence emerged that the company paid $2 million to its star witness, who later admitted lying under oath during a U.S. “racketeering” case targeting the villagers and their lawyers. The witness, Alberto Guerra, later admitted he had been coached for 53 days by Chevron lawyers led by Randy Mastro, who is now the subject of a criminal referral letter for his misconduct in the case.

Prior to today’s decision, 21 separate appellate judges in Ecuador and Canada have affirmed all or parts of the judgment against Chevron; only one U.S. trial judge, Lewis A. Kaplan, has sided with Chevron and he did so based largely on Guerra’s false testimony and a limited record that excluded all evidence of Chevron’s pollution in Ecuador. In today’s decision, the three-judge panel seemed heavily influenced by Kaplan, whose decision has been harshly criticized by objective observers and whose trial was called a “Dickensian farce” by prominent litigator John Keker. (See here for a detailed rebuttal of the Kaplan decision.)

In 2014, the Ontario Court of Appeal rejected a Chevron jurisdictional defense; that decision was affirmed unanimously by the Canada Supreme Court in 2015 in a 92-page decision. Last October, the Ontario Court of Appeal called the case “public interest litigation” when it reversed a Chevron attempt to kill off the litigation by imposing a $1 million costs order on the Indigenous groups. 

(For more on Chevron’s discredited U.S. racketeering case, where it paid a witness at least $2 million for false testimony, see here and here. For how Chevron lawyer Lowenstein has tried to mislead Canada’s courts, see here.)

Chevron also ran into trouble in Canada when evidence emerged that the parent company was using its Canadian subsidiary, Chevron Canada, to funnel billions of dollars in annual payments to the governments of Nigeria and Indonesia. Profits from those deals would then flow directly to Chevron in the United States, and not back through Chevron Canada. Chevron had tried to claim its subsidiary was a wholly separate entity that only operated in Canada.

Canada’s Supreme Court is known to be far more sensitive to Indigenous rights than the country’s lower courts, which does not bode well for the oil major, said John Phillips, a prominent Canadian lawyer who is following the case and advising the FDA.

The Ecuadorians also have attracted significant support around the world, with artists such as Trudie Styler, Sting, and Roger Waters backing their cause. Just this week, Waters posted a video excoriating Chevron CEO Mike Wirth for failing to take steps to end the case. Separately, 36 institutional shareholders recently sent a letter to Wirth urging him to settle the case; several accused the company of “materially mishandling” the litigation.

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