Chevron: Release The Secret Evidence That Proves Your Guilt In Ecuador

Reposted from Karen Hinton on the The Huffington Post

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, 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. (See the redacted rejoinder here.)

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.

(See my recent blog about this legal travesty, and this earlier 2011 press release about the 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. (See 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. (See 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. (See 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 PIs or 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. (See 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." (See 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 fighting aggressively 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 United States.

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. See here.

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.

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Chevron Suffers Major Setback In Ecuador Case as Court Freezes $96 Million In Assets

CEO Watson Forced To Testify Under Oath

That Fourth of July party at Chevron’s headquarters must have been a real dud.

Just before the holiday, news quietly surfaced in Latin America that $96 million in Chevron assets have been frozen in Ecuador at the behest of the indigenous and farmer communities who hold a judgment against the company.  The communities want to use the funds to begin a long-awaited clean-up of their ancestral lands as ordered by Ecuador’s courts, which imposed a $19 billion judgment against the oil giant in 2011.

The asset freeze represents a major setback for Chevron, which has refused to pay the Ecuador judgment even though it promised to do so when it fought to move the trial to the South American nation. The order also came just days after Chevron’s John Watson suffered the ultimate CEO-humiliation by being forced to testify under oath about his company’s malfeasance in Ecuador, exposing him to potential perjury charges.  (More on that below.)

Diverting funds from Chevron to the Amazon – if it actually happens -- might qualify as one of the more inspiring triumphs of indigenous groups over Big Oil in history.

The Associated Press reported that an Ecuador court froze a debt in the amount of  $96 million that Ecuador’s government owes Chevron from an unrelated international arbitration.  If the communities get the money, they could use it not only to start the desperately-needed clean-up but also to hire teams of lawyers around the world to target Chevron assets to collect the full amount of the judgment.  That would allow a comprehensive remediation to take place over an area equivalent to the U.S. state of Rhode Island.

(For background, see here for a video about how Chevron used substandard operational practices and then tried to corrupt the trial; here for a 60 Minutes segment documenting Chevron’s deliberate pollution; and here for a summary of the court evidence against Chevron.).

Given Chevron’s refusal to pay the judgment, which was unanimously affirmed on appeal, the rainforest communities have the legal right to seize Chevron assets wherever they can find them – similar to laws that allow a mother to pursue child support from the assets of a deadbeat father.  For legal purposes, Chevron is now in the same category as a deadbeat debtor and thus is being chased to pay what it owes.

Thus far, the communities have hired top-rated litigators to file seizure lawsuits targeting Chevron assets in Canada, Brazil, and Argentina. Those actions are pending.

The $19 billion judgment came down in 2011 despite incessant efforts by Chevron to corrupt and sabotage Ecuador’s court system and intimidate judges over the course of the eight-year trial.   See this affidavit by Ecuadorian lawyer Juan Pablo Saenz for the chilling details on Chevron’s improper efforts to block the judgment, a summary of which can be read here.

The real danger for Chevron is not that the rainforest communities will begin to remediate the company’s ecological catastrophe.  That clean-up is absolutely critical to save lives.  But the far greater danger for Chevron is that the funds will unleash a torrent of new legal actions around the world.  Such actions would likely bring to fruition the prediction of Chevron Comptroller Rex Mitchell that the Ecuador case will cause “irreparable harm” to the company’s business operations on a global scale.

The Ecuador freeze order was handed down by Dr. Wilfrido Erazo, the presiding judge in the provincial court in the Oriente region of Ecuador where Chevron (under the Texaco brand) operated 378 wells and separation stations from 1964 to 1990.  Erazo’s decision lays the groundwork for the funds to be diverted to a trust fund set up under court order to pay for a clean-up.

Pablo Fajardo, the lead lawyer for the affected communities, told the AP that a further court decision on the final disposition of the funds can be expected in the coming weeks.  Fajardo said the rainforest communities hope to use the funds to clean some of the 916 open-air toxic waste pits left by Texaco when it fled Ecuador in the early 1990s.  (BP’s $40 billion liability for the far smaller Deepwater Horizon disaster is a relevant benchmark for the cost of a clean-up.)

At the time it left Ecuador, Texaco’s internal audits conducted by two environmental consulting firms painted a devastating picture of the nasty impact of the company’s operations – including extensive toxic contamination at 100% of the well sites inspected and an utter failure to implement environmental controls.  Records show that in Ecuador Texaco executives rejected spending even modest sums of money to line its hundreds of open-air toxic waste pits so that they wouldn’t contaminate soils and groundwater.  It also ordered, in a clear act of obstruction of justice, the destruction of documents relating to its many oil spills.

Robert F. Kennedy Jr. visited the disaster zone in the latter stages of Texaco’s operations and wrote a powerful essay describing scenes “reminiscent of war” with rivers running black with oil and toxic waste pits dotting the landscape.  Almost two decades later, Congressman Jim McGovern visited and found the same horrid conditions, as can be seen in this letter that he wrote at the time to President-elect Obama.

In the 1990s, as it faced mounting liability from the original lawsuit filed by the affected communities in the U.S., Texaco attempted a woefully inadequate clean-up that encompassed only 16% of its oily waste pits.  That effort was a fraud pure and simple, as found by the Ecuador court and as confirmed by dozens of independent journalists who have visited the region.

Essentially, Texaco “remediated” by running dirt over a few waste pits to hide their existence and leaving others untouched by claiming that they were being used for fishing by local residents.  See this recent picture of a waste pit to understand what Texaco’s original pits look like today after its so-called “remediation”.  The Ecuador court found that the abandoned pits continue to contaminate soils, groundwater, and surface water – putting at risk the lives of tens of thousands of people who rely on natural water sources for their survival.

The freeze order is not the only bad news of late for Chevron on the Ecuador case.

We reported last week that the crown jewel of Chevron’s defense to the Ecuador judgment – its retaliatory  “fraud” lawsuit against the Ecuadorians and their lawyers -- is now in jeopardy because of the odd rulings of a U.S. federal judge who seems to openly favor Chevron and who has made comments from the bench that the Ecuadorians consider xenophobic.

An appellate court recently ordered Chevron and the judge to submit briefs explaining several rulings in the case that appear to defy established legal authority.  The Ecuadorians and their lawyers are seeking to remove the judge, Lewis A. Kaplan; two of their petitions outlining his bias and outlier rulings can be read here and here.

The appellate court already unanimously reversed Judge Kaplan in 2012 when he tried to impose an illegal injunction purporting to block enforcement of the Ecuador judgment anywhere in the world.  That injunction led to a fair amount of international scorn being heaped on the American judiciary.

The latest setbacks also come on the heels of a furious critique by many large Chevron shareholders of CEO Watson’s mishandling of the Ecuador litigation (see here and here).  Watson was the executive at Chevron in charge of mergers when the company acquired Texaco in 2001 for $36 billion.  Watson clearly did not take into account Texaco’s Ecuador liability in the purchase price, a fact which haunts him to this day and has prompted calls for an SEC investigation.

In what can only be described as a humbling experience for a man surely used to being treated like royalty, Watson was forced to answer questions under oath posed directly by his longtime nemesis, Steven Donziger.  Donziger is a human rights lawyer who with local Ecuadorian counsel spent almost two decades building the case against Chevron.  Chevron now targets Donziger as part of a vicious corporate retaliation campaign that includes surveillance of himself and his family.   Read this affidavit to get a feel for Chevron’s creepy tactics.

See here for how Donziger has sued Chevron for trying to use the New York “fraud” case to cover up its environmental wrongdoing, fraud, and attempted bribes in Ecuador that stretch over several decades.  The existence of Donziger’s claims (even though Judge Kaplan predictably has tried to block them) is a chilling reminder of the ugly truth that Chevron tries to sweep under the rug through distracting litigation and a deceptive corporate advertising campaign.

The transcript from Watson’s deposition has been sealed, at least for now. Given what’s gone on in Judge Kaplan’s courtroom, we cannot say we are surprised.



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Chevron’s Latest “Defense” In Ecuador Case: Hide Assets In Subsidiaries

After a dreadful series of legal setbacks, it sure didn’t take long for Chevron to come up with a new tricked-up defense to evade the $19 billion Ecuador environmental judgment.

Like Chevron’s many other failed defenses in the Ecuador case, this one won’t wash either.

Let’s review how we got here.

The company’s first line of defense in the 1990s was we didn’t really dump billions of gallons of toxic waste into the rainforest.  That lie was put to rest by multiple courts around the world based on overwhelming scientific evidence, as confirmed by numerous independent media outlets such as 60 Minutes.

Then, Chevron tried to claim that the devastated communities in Ecuador sued the wrong party.  According to Chevron, they should have sued Texaco, the company that operated in Ecuador.  That argument was rejected out of hand by appellate courts in Ecuador and the U.S.

Then the company blamed Petroecuador, Ecuador’s state-owned oil company and Texaco’s former partner in Ecuador.  But various courts rejected that defense after evidence surfaced that Chevron’s predecessor company was the exclusive operator of the oil concession in Ecuador.

When that defense failed, Chevron tried to claim Ecuador’s government released it from any clean-up obligations.  But courts found this so-called “release” did not cover the private claims of the rainforest communities, and in any event was a product of fraud.

Left with virtually no options, Chevron then tried to coax New York federal Judge Lewis A. Kaplan to enjoin the villagers from enforcing the Ecuador judgment anywhere in the world.  This unprecedented action caused an international furor, and a U.S. appellate court quickly reversed Kaplan.

When Chevron hired the respected litigator Ted Olson to appeal that setback to the U.S. Supreme Court, the company was rejected yet again.   By this point, nobody seemed to be able to put lipstick on Chevron’s pig.

So what’s left?

Well, now Chevron claims that its 73 revenue-producing subsidiaries around the world should be off-limits to the Ecuadorian villagers as they try to collect on the $19 billion judgment.

Consider the absurdity of Chevron’s latest gambit.  The company discloses in its annual report that almost all of its revenues are generated from subsidiaries around the world which are managed by the parent company from its global headquarters in California.

So according to Chevron, if you win a lawsuit against the parent company it simply won’t pay up.  Yet at the same time, its subsidiaries are off limits because their assets are not really owned by Chevron or connected to its activities in Ecuador.   Chevron already stripped almost all of its assets from Ecuador.

The order by the Argentine court last week to freeze Chevron assets in that country – a shareholder shocker if there ever was one -- was met with an apoplectic response at the company’s headquarters. “The plaintiffs' lawyers have no legal right to embargo subsidiary assets in Argentina," huffed spokesman James Craig.

Yes they do, James.  Hiding behind subsidiaries to avoid paying liabilities is now considered an antiquated notion in the legal world.  It rarely if ever works, particularly when the judgment is out of the country where you wanted the trial held and where you promised to pay up if you lost.

There’s another reason Chevron spokesman Craig is out of sorts.

Chevron discloses that about 80% of its annual revenue comes from subsidiaries outside of the U.S. Chevron’s subsidiaries in Canada and Argentina, two countries where the affected communities have filed seizure actions, produce an annual revenue stream of $2 billion to $3 billion for the parent company.   The rainforest communities can collect the full amount of their judgment in a few years just be diverting those funds to a clean-up.

The arithmetic Chevron-style works like this: when it comes to counting $240 billion in annual revenue collected from subsidiaries around the world, Chevron is as proud as a peacock.  Every penny counts.  But when it comes to paying out its environmental liabilities, there is nothing in the piggy bank.

We now get it. Under Chevron’s twisted logic, after fighting in court for almost two decades, the Ecuadorian who are suffering from cancer and birth defects now have no place to collect their winning judgment.  This is how a large oil company convinces itself that it is entitled to impunity for its human rights crimes.

It is well-documented that Chevron’s management team, led by CEO John Watson and General Counsel R. Hewitt Pate, is mired in conflicts of interest when it comes to Ecuador. Watson gave Pate a 75% raise last year – for a total compensation of $7.8 million -- after he lost the Ecuador case.  The company has admitted under oath that it faces “irreparable harm” from the Ecuador judgment but outside court it claims the risk is no big deal.

Any court in the civilized world that hears this case will not allow Chevron to manipulate the corporate form in this fashion.  The company is acting like a Deadbeat Dad fleeing a jurisdiction to avoid a child support payment.

The day of reckoning for Chevron management is fast approaching.

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Chevron Can't Stop The Lies

In a recent letter to the Canadian newspaper, The National Post, Chevron repeats its lies to distract attention from its own misconduct in the world's largest oil-related environmental disaster in the Ecuadorian rainforest. 


For example, Chevron representatives are fond of claiming that a number of U.S. courts have “found” that there was “fraud” in the litigation in Ecuador. This is completely false. When Chevron made this assertion to one journalist who included it in his story, his publication, Courthouse News, was forced to run a retraction once it realized the reporter had been misled, stating that while “[a]n earlier version of this article quoted a Chevron spokesman as saying that eight federal courts had found the Ecuadorean plaintiffs had committed fraud. In fact, the courts issued crime-fraud exception findings during discovery. Chevron’s fraud allegations against the Ecuadorean plaintiffs remain unproven.” See here.

No U.S. court has made any final determination with respect to Chevron’s fraud allegations. In fact, 13 U.S. courts rejected or otherwise declined Chevron’s invitation to apply what is known as the crime/fraud exception. Such an exception requires a court to make only a prima facie showing that a fraud might have occurred if proven to be true. But no actual factual findings have been made. As one court succinctly put it: “The circumstances supporting [Chevron’s] claim of fraud largely are allegations and allegations are not factual findings."  Another wrote that Chevron was making a "mountain out of a molehill."  See here.

Chevron tries to distract attention from these facts with statements replete with falsehoods; meanwhile, independent journalists have long confirmed the company’s hand in creating this unprecedented catastrophe.  See these recent news reports from the Australia program Sunday Night; the American show 60 Minutes and this extraordinary video from the plaintiffs summarizing the evidence and Chevron’s corrupt attempts to derail the trial.   A story in Vanity Fair on the courageous Ecuadorian lawyer Pablo Fajardo, who was raised in abject poverty and who has been targeted with death threats, can be seen here.

Chevron takes emails and other correspondence out of context and cleverly edits video to make it appear that our own experts do not believe there is contamination. Yet one of the most respected experts in the world on how contaminants travel in groundwater – Dr. Ann Maest -- testified under oath recently that there is massive contamination of water in Chevron’s concession area. See here and here. In a blatant act of deceit, in a blog Chevron leaves the false impression that Dr. Maest agrees with the company that there is no water contamination.  See here.

Chevron’s assertion that the plaintiffs wrote the judgment is a both a fabrication and a final act of desperation. For this argument, Chevron relies on more paid experts who analyze what they call “word strings” from an internal memo from the plaintiffs that appeared in a handful of paragraphs in the 188-page judgment.  Yet arguments from the memo using the same language were submitted to court in numerous motions throughout the eight-year trial.  It is completely plausible for a court to adopt arguments and language from briefs or other materials submitted to the court.

The real and only fraud is Chevron's environmental crimes, its phony remediation, its manipulation of evidence during the Ecuador trial and its abuse of the rule of law by delaying and attempting to derail the trial during the eight-year-long proceeding. See here, here and  here.

These facts, as confirmed by Ecuador’s courts and independent journalists, are bad for Chevron.  More to the point, they explain why the company tried to sabotage the proceedings in Ecuador, and how it will now try to convince courts it Canada that somehow it was the victim of a shakedown by indigenous groups in Ecuador.

Don’t believe it.

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Chevron Blogger Dumped by San Francisco Chronicle for Ethics Lapse

Zennie Among Several Paid By Chevron To Fake Positive News Coverage

The San Francisco Chronicle has finally thrown blogger Zennie Abraham off of its website City Brights after his ties to a Chevron operative were disclosed.

Recently, The Chevron Pit, exposed Zennie and his connections to Sam Singer, a Chevron media consultant based in San Francisco. Singer clearly pays Zennie to write positively about many of his clients, including Chevron. See this post here. Yet, Zennie never disclosed that he was paid to shill for Singer's clients.

The Chronicle’s decision to take a more ethical look and ultimately terminate Zennie should be applauded. Considering that Chevron often uses underhanded methods to buy positive media, the hometown newspaper of the San Ramon-based company is no longer being used as an unwitting instrument of the oil giant.

Chevron has a long and sordid history with writers like Zennie who pretend to be something they are not, so Chevron can circulate its deceptions about the company’s intentional contamination of the Ecuadorian rainforest.

Given the oil giant’s horrific record of contamination in both Ecuador and the U.S, paying for good news is about the only way for Chevron to get any. This year an Ecuador court awarded a group of indigenous tribes $18 billion for damages related to oil contamination left by Chevron in the rainforest. Several months later, a U.S. court denied efforts by Chevron to avoid paying the judgment.

Chevron, though, sees itself above the law of the land and doesn’t hesitate to resort to such tactics as:

Allowing the spouse of a Chevron employee to fake being an independent journalist so he could attack the legal case of the Ecuadorians.

Pro-Chevron blogger, Alex Thorne, tried to pass himself off as a legitimate journalist by emailing questions to environmental groups about their funding of the San Francisco-based Amazon Watch, a supporter of the Ecuadorians. Thorne claimed to be working on an “article” for a publication that he refused to specify. He also did not use his last name in the email, signing it only as “Alex.” The e-mails then asked the funders “if it is time” to “reevaluate” their support for Amazon Watch in light of Chevron’s phony charges of fraud in the lawsuit.

But Thorne failed to acknowledge two major points in his emails to the environmental groups. First, he is married to Kristen Thorne, Chevron’s senior policy advisor on environment and energy issues. Second, he has operated a pro-Chevron website critical of the leaders of the Ecuador lawsuit against Chevron.

After these facts came to light, Thorne closed down his blog.

Trying to pay a journalist to spy on the Ecuadorians.

In 2010, Chevron tried to pay a real journalist $20,000 to spy on sick Ecuadorians to determine if they really had illnesses. Chevron wanted the reporter, Mary Cuddehe, to lie to the Ecuadorians saying she wanted an “interview” about their medical condition when really she would be reporting back to Chevron. Recruited by Kroll – a private investigative firm hired by Chevron – Cuddehe considered the offer. Her conscious got the best of her, though. She turned Chevron down and then wrote about the whole thing, exposing Chevron’s deception.

Faking a television newscast sympathetic to the company.

In 2009 when Chevron learned that a potentially damaging report about the company’s oil contamination in the Amazon rain forest was being prepared by 60 Minutes Chevron executives hired former CNN correspondent, Gene Randall, to produce a misleading report espousing solely Chevron’s point of view but appearing to be objective.

In the video produced by Chevron, Randall, interviewed Chevron’s managers and consultants but completely ignored the arguments of the plaintiffs. The fake news report ends with the deceptive voiceover “Gene Randall reporting.”

The “news cast” remains on Chevron’s web site and appears in Google searches.

As for Zennie, we can only hope that one day he’ll get a real job.

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Once Again Chevron Masquerades As A News Organization

Uses Employee’s Spouse -- A “Stay-Home Dad” -- To Undermine Environmental Group Critical Of Its Contaminated Legacy In Ecuador

In a press release issued today, the Amazon Defense Coalition revealed another example of Chevron posing as an independent “journalist” to send e-mails to funders of a small environmental organization that has been critical of Chevron’s management for refusing to pay the company’s court-ordered $18 billion liability in Ecuador.

This stunning revelation about Thorne’s e-mails comes just days after several large Chevron shareholders blasted Chevron CEO John Watson for displaying "poor judgment" in Ecuador which “has led investors to question whether [Chevron’s] leadership can properly manage the array of environmental challenges and risks that it faces.” The comments from the investors, who manage a combined $156 billion in assets and include New York’s pension fund, are contained in a letter sent to Chevron.

Alex Thorne

Thorne recently sent e-mails to several funders of the U.S.-based environmental group Amazon Watch in which he claimed to be working on an “article” for a publication he refused to specify. He also did not use his last name in the email, signing it only as “Alex.” The e-mails then asked the funders “if it is time” to “reevaluate” their support for Amazon Watch in light of Chevron’s oft-criticized claim that the 18-year legal case is part of an extortion racket.

Thorne is married to Kristen Thorne, Chevron’s senior policy advisor on environment and energy issues. Alex Thorne did not disclose in the emails to Amazon Watch’s funders that he is married to a high-level Chevron employee or that he has operated a pro-Chevron website critical of the leaders of the Ecuador lawsuit.

“Alex Thorne’s phony emails are part of Chevron’s Karl Rove-style campaign designed to intimidate American citizens who are trying to hold Chevron accountable for committing environmental crimes and fraud in Ecuador,” said Karen Hinton, the spokesperson for the Ecuadorian communities who brought the lawsuit.

In one email to the Moriah Fund, which was forwarded to Amazon Watch, Alex Thorne says: “I’m writing an article highlighting Amazon Watch’s top donors which will include mentioning the Moriah Fund… My article highlights organizations such as yours and questions whether it is time to reevaluate your support for Amazon Watch.”

Representatives of the Amazon communities have long charged that Chevron committed environmental crimes in Ecuador and that its “extortion” claim is nothing more than a last-ditch ploy to mislead shareholders. Two Chevron employees are currently under criminal indictment in Ecuador for lying about the results of a purported environmental cleanup that the plaintiffs say was a clear case of fraud.

Amazon Watch, which is based in San Francisco near Chevron headquarters, has a handful of staff members and a $950,000 annual budget. In contrast, Chevron has 62,000 employees and grossed $204 billion last year, or an amount roughly 200,000 times more than Amazon Watch’s annual expenditures.

Despite their lack of resources, Amazon Watch’s staff members have had an outsized impact on Chevron. They have infuriated Chevron’s management by filing complaints against the oil giant with the Securities and Exchange Commission, by confronting the company’s Board of Directors during shareholder meetings, and by organizing protests outside the home of Chevron CEO Watson.

Just last week at Chevron’s annual meeting, Amazon Watch Executive Director Atossa Soltani accused Watson of having a personal conflict of interest over the Ecuador issue while several Chevron Board members looked on in stunned silence.

Along with lawyers for the Ecuadorians, Amazon Watch also has accused Chevron of engaging in a Nixon-style “dirty tricks” campaign in Ecuador designed to sabotage the trial. These activities have been summarized in the sworn affidavit of Ecuador attorney Juan Pablo Saenz, filed in multiple courts and available here.

Chevron’s larger problem is that an Ecuador court in February imposed a cleanup tab of $18 billion for the deliberate discharge of billions of gallons of toxic waste into streams and rivers of the Amazon rainforest, where the company operated (via predecessor company Texaco) from 1964 to 1992. Chevron’s substandard operational practices in Ecuador – admitted to by the company at trial -- decimated indigenous groups and caused an outbreak of cancer and other oil-related diseases that will haunt tens of thousands of people for decades without a comprehensive remediation, according to evidence submitted by the plaintiffs.

For most of 2009, Alex Thorne maintained a website where he regularly attacked the leaders of the Ecuador lawsuit and Hinton.

After Hinton wrote in a press release about his wife’s participation in a “green technology” panel discussion that failed to describe Chevron’s environmental disaster in Ecuador, Alex Thorne created a separate website called “Hinton Communications Watch” that was designed to intimidate Hinton into stopping her work for the Ecuadorian indigenous communities, said Hinton. Alex Thorne later took down the websites and at the time apologized to Hinton.

This is not Chevron’s first attempt to use the image of independent journalists as cover for its campaign to undermine the legal claims of the impoverished Ecuadorian communities, said Hinton.

Last year, Chevron was caught trying to pay American free lance journalist Mary Cudahee $20,000 to spy on the plaintiffs in Ecuador by pretending she was conducting research for an article. Cudahee exposed the effort in The Atlantic.

In 2009, just days before a 60 Minutes segment critical of Chevron’s misconduct in Ecuador was slated to air, the company posted on the internet a pro-Chevron corporate video on Ecuador narrated by former CNN correspondent Gene Randall that was designed to look like a legitimate news broadcast. Chevron hid its role in paying for the production of Randall’s video until it was exposed by The New York Times.

Nor is Chevron shy about pushing the envelope when attacking its many vocal critics on the Ecuador issue.

Chevron CEO Watson ordered the arrest of five shareholder critics at the company’s 2010 annual meeting; Chevron took out newspaper advertisements attacking the U.S.-based Goldman Foundation for awarding its prestigious environmental prize to advocates for the Ecuadorian victims of Chevron’s human rights abuses; and Chevron recently filed a racketeering lawsuit in the U.S. federal court against 47 Ecuadorian villagers and their lawyers that named Amazon Watch as a “co-conspirator”.

Hinton noted that Chevron has been advised by CRC Public Relations, which launched the Swift Boat attacks ads that targeted 2004 presidential candidate John Kerry. CRC has close ties to the far right of the Republican Party and is a darling of the Tea Party movement.

CRC is one of at least six public relations firms and four corporate law firms used by Chevron General Counsel R. Hewitt Pate to deal with negative fallout from the Ecuador judgment, apparently the largest environmental liability in history other than the BP Gulf spill, said Hinton. Pate is a former high-level political appointee in the U.S. Department of Justice under President George W. Bush and is the person responsible for Chevron’s Ecuador litigation strategy, she added.

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More On Chevron’s Lies To Dupe Columbia Journalism Review

In a previous entry, we detailed how Chevron lied to Columbia Journalism Review writer Martha Hamilton about the operation of a well site called Shushufindi 38 in the Ecuadorian rainforest and the amount of toxic contamination at the well to convince her that 60 Minutes had not been fair to Chevron in its coverage of an environmental lawsuit against the oil company for extensive oil contamination.

Chevron told her the government-owned oil company Petroecuador operated the site, and fecal matter, not oil, had contaminated the well. Both statements are flat-out lies that Hamilton accepted as fact but 60 Minutes checked and, as a result, did not report.

Upon further review, it looks like Chevron also lied to her about the drinking water well site near the oil well site.

A water sample taken in the trial directly from this freshwater well showed toxic levels of likely carcinogens and harmful heavy metals that are derived from oil, including benzo[a]pyrene, indeno[1,2,3]pyrene, and cadmium. The U.S. government has determined that each of these chemicals are likely or probable carcinogens, as reflected in a toxic substance registry maintained at the Centers for Disease Control in Atlanta. See this press release about the water well.

In her critique of the coverage, Hamilton wrote that the news show should have stated Petroecuador was responsible for the cleanup of the well site under a 1995 agreement. (It's unclear if she meant drinking water or oil well, but either way both has dangerous levels of contamination.)

But the agreement she references is the centerpiece of the legal dispute, as 60 Minutes clearly says. Following the visuals of Shushufindi 38, the news show states:

"Chevron says the pollution is now the responsibility of Petroecuador. That dispute is at the heart of the lawsuit."

Even though Hamilton says she is not weighing in on the merits of the lawsuit, one has to wonder why she did not contact the plaintiffs to check basic facts, something that we are sure Columbia Journalism Review would encourage all journalists to do.

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Chevron Lied To Columbia Journalism Review About Toxic Oil Well

Shushufindi 38, the famous pit closed by Texaco in 1984 as seen in recent months. Chevron’s tests found no contamination here.

Chevron has told the highly respected Columbia Journalism Review a flat-out lie about an oil well site in Ecuador and the harmful level of contamination found at the site’s oil pit, featured in a 60 Minutes piece that aired almost a year ago.

In a critique of 60 Minutes’ coverage of the eco-disaster lawsuit filed by indigenous tribes in Ecuador against Chevron, CJR writer Martha Hamilton said the CBS news show should have reported that the government-owned oil company Petroecuador operated the well site Shushufindi 38 after Texaco left Ecuador in 1992.

Had Hamilton contacted the plaintiffs in the lawsuit about her pending critique, she would have learned that Chevron lied to her. Court documents clearly show that only Texaco operated the well site, which Texaco closed in 1984.

Chevron also told Hamilton that soil tests turned up no contamination at the site. Again, court documents clearly show this to be false. Tests from the plaintiffs revealed illegal levels of toxins at over 400 times the Ecuador legal limit of 1,000 parts per million of Total Petroleum Hydrocarbons and over 4,000 times the legal limit as allowed in most states in the United States (about 100 ppm of TPH).

For copies of these court documents, go to:

http://chevrontoxico.com/assets/docs/pkshu38closed1984.jpg
http://chevrontoxico.com/assets/docs/pktexacopits.pdf

Chevron’s tests at the well site pictured above, on the other hand, showed no contamination. Why? Chevron took its test samples uphill and away from the well site. Taking soil samples far away and uphill from toxic waste sites where Chevron knows it will find little or no contamination, and then using those same samples to report the toxic waste sites pose no risk to human health, is part of the company’s fraud in the Ecuador litigation.

Hamilton also argues that 60 Minutes should have spent more time explaining the 1995 remediation agreement between Texaco and the government of Ecuador. Hamilton reported that Petroecuador is responsible for cleaning up Shushufindi 38, but we disagree.

If 60 Minutes had spent more time explaining the remediation agreement, viewers would have understood why we disagree, and Chevron would have looked even worse. Viewers would have learned that Texaco and Ecuador’s government negotiated the agreement after the plaintiffs filed their lawsuit in the US in 1993. They also would have learned that the agreement applied only to potential government claims, and expressly excluded the private claims being heard in the lawsuit.

Viewers also would have been told about how Texaco claimed to have cleaned about 16% of over 900 oil pits built by Texaco, a clear violation of its agreement with Ecuador’s government (which required it to clean 37% of the pits). Yet Texaco didn’t actually clean those pits. It just bulldozed dirt over them. Hundreds of tests taken at these “remediated” oil pits demonstrate they are as toxic as the pits that Texaco didn’t clean. Even Chevron’s tests submitted into court evidence show that Texaco did not clean these pits. The entire clean-up on which Chevron’s defense rests was a sham.

Because Texaco said it cleaned the pits, people living in the area thought they were cleaned so they built homes directly on top of toxic waste dumps. Here’s an example at a so-called “remediated” pit at Shushufindi 43.

A home built on top of Texaco’s toxic oil pit at Shushufindi 43.

As a result, Texaco’s phony cleanup resulted in putting people even closer to the contamination, increasing the risk of exposure to harmful chemicals. Match that up with the fact Chevron has never issued a warning to the local population that the pits are dangerous hazardous waste sites.

Had Hamilton contacted both sides, she could have written a completely different story: about how Chevron is attacking 60 Minutes so it can divert attention from its cover-up of Texaco’s phony cleanup.

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Chevron Sullying Reputation of American Corporations Abroad; Garrigo Sullying Chevron’s Reputation at Home

Chevron's spokeswoman and resident "Misrepresenter in Chief" Silvia Garrigo was at it again during an interview with CNN's Rick Sanchez on Oct. 22. Garrigo, who professes to love the environment, last made headlines with her abysmal performance on CBS News' 60 minutes, where she dismissed health concerns in Ecuador's Amazon by comparing cancer-causing toxins in oil to the makeup on her face. This was Garrigo's classic line:

"I have makeup on, and there's naturally occurring oil on my face. Doesn't mean that I'm going to get sick from it."

The experts who run Chevron's embattled public affairs office either have very few options, or they apparently thought Garrigo's comparison of contamination to makeup was solid enough to put her on CNN. Garrigo was responding to Kerry Kennedy's account of her heartbreaking visit to the Ecuadorian rainforest where Texaco (now Chevron) intentionally dumped more than 18 billion gallons of toxic waste and abandoned over 900 unlined waste pits while operating a large oil concession from 1964 to 1990.

Kennedy, a mother of three and a longtime human rights advocate, described in detail the devastation she witnessed as a result of improper operating practices by Texaco (now Chevron). She told of the gasoline-like smell coming from the runoff from pipes intentionally designed by Texaco to discharge oil sludge and waste water from the pits directly into the rivers and streams used by the indigenous communities in the area for drinking, bathing, and cooking. She also recounted stories from the indigenous communities of rape and abuse at the hands of Texaco employees. This would not have occurred, she argued, if the residents were living in this country.

In response, Garrigo chided Kennedy for spending only a few days in the region -- as if it takes more than a few minutes to understand that huge open pits of oil, left untouched since Texaco abandoned them many years ago, are a mess that needs to be cleaned up. (Kennedy's trip is a few days more than any member of Chevron's management or Board of Directors has spent in Ecuador. No person with any real authority at the company – including outgoing CEO David O'Reilly, incoming CEO John Watson, outgoing General Counsel Charles James, and new General Counsel R. Hewitt Pate -- has been to the affected region of Ecuador.)

Garrigo then presented three arguments that she desperately wanted to share with the American public: 1) That Texaco had remediated its portion of the contamination and that what Kennedy saw was now the responsibility of Ecuador's government; 2) The cancer claims are false (Garrigo's apparent personal favorite); and 3) The Ecuadorian judiciary is corrupt.

All three arguments, not surprisingly, are either misleading or outright lies. The facts are as follows:

Garrigo: Any contamination Kennedy witnessed was caused by Petroecuador, Ecuador's state-owned oil company that inherited Texaco's well sites in 1992 when Texaco left the country.

Fact: Contrary to Garrigo's claim, Kennedy visited well sites built and run exclusively by Texaco. Aguarico 2 was solely operated by Texaco from 1974 to 1990 and then closed. This site was never operated by any other oil company. Kennedy dug mere inches into the ground before discovering oil in the soil, which is leaching into groundwater and ending up in the nearby stream where local residents drink the water. Kennedy saw the same contamination at Shushufindi 38, a pit opened by Texaco in 1975 and closed by Texaco in 1976. She also saw well site Aguarico 4, which was operated by Texaco from 1974 to 1984. In other words, Kennedy saw unlined waste pits built and closed by Texaco in the 1970s and 1980s that are still causing pollution today.

Texaco's so-called "remediation" cited by Garrigo involved fewer than 16% of the 916 pits that Texaco built. The remediation has been proven at trial to be either ineffective, or a complete fraud. Independent inspections of Texaco's "remediated" sites have found extensive levels of contamination, often thousands of times higher than the Ecuadorian norms that establish when human health is at risk. In fact, two Chevron lawyers and seven former Ecuadorian government officials are now under indictment for fraud connected to their involvment in the certification of the "remediated" pits. One of the Chevron lawyers under criminal indictment, Ricardo Reis Veiga, is thought of so highly by the company that he is still running Chevron's downstream operations in Latin America. (Reis Veiga also supervised Garrigo for several years on the Ecuador trial out of Chevron's office in Coral Gables.)

Garrigo: Any claims about health impacts in Ecuador from exposure to oil contamination are false.

Fact: It is well-established that exposure to any number of the chemicals and compounds that makeup oil is linked to higher instances of cancer – and numerous, peer-reviewed studies show elevated instances of cancer in the region of Ecuador which Texaco contaminated.

Is there anyone outside of Chevron who seriously believes there is no connection between consuming water and foods contaminated with oil and cancer? The independent, peer-reviewed studies measuring the impact of contamination on the health of people living in the Chevron concession area have found that cancer rates were anywhere from 1.7 to 4 times greater than for people living outside the area. One study found that the risk for spontaneous abortion was 2.34 times higher among woman living near the contamination. Based on survey data, the court Special Master calculated 1,401 excess cancer deaths resulting from the contamination. (Texaco, in the 26 years that it operated in Ecuador, never conducted a single health evaluation in the region nor took even one soil or water sample to determine if its operations were causing contamination.)

Garrigo: The courts in Ecuador are "corrupt to their core":

Fact: As Kennedy noted in her interview, the plaintiffs originally filed the lawsuit in New York Federal Court in 1993. Texaco and then Chevron fought to have the case removed to Ecuador arguing in 14 affidavits that the Ecuadorian judiciary was not only the more appropriate forum, but that the judicial system was competent and fair. Chevron won that battle, and the same case was re-filed in Ecuador in 2003. Once the trial started and evidence pointed to Chevron's culpability, Chevron changed its tune and started to attack the very courts it previously had praised. The animating principle: praise courts when you think you can win, condemn them when you think you are going to lose. But as Garrigo said on 60 Minutes when she got cornered by correspondent Scott Pelley, the reality is there is no court in the world that Chevron would agree to because Chevron is above the law and the claims relating to the pits Kennedy saw are "frivolous".

In reality, Chevron has tried to corrupt the Ecuadorian court process to derail the trial and evade a judgment – which explains why Chevron is under three separate official investigations for possible criminal violations relating to its misconduct in Ecuador. It also why Ecuador's Attorney General has asked the Department of Justice to investigate the company for violating the Foreign Corrupt Practices Act. Garrigo asks about corruption? She should just walk down the hall. Garrigo's colleagues at Chevron have fabricated a false military report to cancel the Guanta judicial field inspection, have filed redundant motions to delay the trial, have threatened various judges when they refuse to rule in the company's favor, and have harassed and stalked the court-appointed Special Master to the point where he needed police protection. Just weeks ago Chevron discovered a "bribery scandal" that has all the telltale signs of a hoax perpetrated by the company to sabotage the trial. That doesn't count the numerous and anonymous death threats leveled at plaintiff's counsel during the trial – threats that don't seem of great concern to Chevron, which has remained silent on this most critical of issues.

At the end of the interview, CNN anchor Rick Sanchez asked Garrigo if contamination of the sort left by American corporations is "sullying our reputation in the world." She said she couldn't agree more but Chevron has always acted appropriately.

Chevron has always acted appropriately? From Ecuador (largest oil-related contamination on the planet), to Burma (where Chevron is partners with the repressive military junta), to the Philippines (where Chevron has caused spills, leaks, and fires in a residential area because of its oil depot), to Nigeria (where the company is accused of being complicit in an army-orchestrated killing of protesting villagers), at least some people on the receiving end of Chevron's misconduct would probably disagree with Chevron's Manager of Global Issues and Policy.

By its handling of the Ecuador case, it appears that Chevron not only doesn't mind sullying America's reputation. It also doesn't seem too concerned about its own reputation, either.

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