Chevron’s Fugitives from Justice and the Bogus TCLP Test

Not only has Chevron readily admitted in trial that it deliberately discharged billions of gallons of toxic "water of formation" into Ecuador's Amazon rainforest, but it also has figured out a clever way for its employees to evade justice. What began as a corporate strategy of cover-up has trickled down to Chevron's lawyers who do the company's dirty work in Ecuador.

Rodrigo Perez Pallares is a perfect illustration of the extent of Chevron's corruption in Ecuador. This disgraced Ecuadorian lawyer had worked as Chevron's official corporate agent in Ecuador for more than three decades while it mercilessly dumped toxins into the Amazon. Pallares was paid handsomely for defending a system of oil production that imposed horrific costs on the local indigenous population. After Chevron was sued in U.S. federal court by those groups for clean-up in 1993, Pallares helped to mastermind Chevron's sham "remediation" in the mid-1990s that the company has continually (and unsuccessfully) used to try to escape liability in various courts.

Pallares now appears to be a fugitive from justice, having fled to Miami after being indicted on fraud charges in Ecuador related to a cover-up of the contamination. Chevron should fess up as to whether it is paying for his relocation costs and living expenses. The U.S. government also might note that Chevron might be harboring a fugitive from what could be the world's worst environmental crime.

Chevron used the Pallares "clean-up" to argue that the then-pending environmental against (Aguinda v. ChevronTexaco) should be dismissed from U.S. federal court. The argument didn't work, but Pallares and his sidekick Ricardo Reis Veiga built a career out of it anyway. The pair orchestrated the use of an improper laboratory test, called the TCLP test, which made it impossible to measure anything more than trace amounts of toxins at the highly contaminated "cleaned" sites. The TCLP test runs water over contaminated soil, and then measures the toxins in the water instead of the soil. Only problem? Oil and water don't mix – so it's physically impossible for anything more than trace contaminants to show up in the TCLP test results, even if the soil sample tested was full of pure crude oil. Pallares and Reis Veiga used these test results to "prove" that the sites were remediated to they could procure a "release" under false pretenses.

Pallares and Reis Veiga probably never expected that their fraudulent handiwork would come under independent scrutiny during the Aguinda trial in Ecuador. But hundreds of scientific sampling results from the trial definitively prove that Chevron's representations to Ecuador's government about the "remediation" – used to induce the release -- were lies. Chevron's "remediation" amounted to bulldozing dirt over the waste pits without cleaning them out. Other waste pits the company had agreed to clean were never touched; Chevron's engineers claimed they were being used for "fishing" by the locals.

Chevron's fraud is as plain as day. Compare what Chevron reported to Ecuador's government in 1998 (at the end of its "remediation") to the actual trial results from the same sites:

Chevron's Fraud During The Ecuador Remediation

(Measured in TPHs)

Site of Judicial Inspection: Lago Agrio Trial	Chevron's Reported Result to Obtain Release From Ecuador (1998)	Actual Result At Same Site During Trial (2006)
Sacha 18	No Detect	35,380 ppm
Sacha 65	No Detect	32,444 ppm
SSF 27	No Detect	26,413 ppm
Atacapi 5	No Detect	21,976 ppm
Sacha 21	No Detect	17,000 ppm
SSF 21	No Detect	16,033 ppm

This chart is telling. The maximum tolerance for TPH (which measures hydrocarbon contamination) in many U.S. states is 100 parts per million (ppm). In Ecuador, the maximum tolerance for "sensitive ecosystems" like the Amazon is 1,000 ppm. In Ecuador, pits Chevron claimed it cleaned (such as pits at Well Sites Sacha 18 and Sacha 65) are obviously more than three hundred times higher than what would be a maximum tolerance in many U.S. states and dozens of times higher than the more lax Ecuadorian norm. And these are the cleaned sites.

Note in the second column of the chart that Chevron reports its results as "no detect" rather than giving the actual result. First, the clean-up standard of 5,000 ppm that Chevron maliciously negotiated with Ecuador's government is more than 50 times more lax than a typical U.S. norm. Sort of shows you how much Chevron values an Ecuadorian life. Given that the company knew it couldn't meet even this ridiculously lax standard with its clean-up, it used the bogus TCLP test which made it physically impossible to violate the 5,000 ppm standard. All this so the company could induce a release under false pretenses.

Even if the cleanup Chevron conducted hadn't been fraudulent, the cleanup would not absolve Chevron of responsibility. The release expressly excludes the private claims that are being pressed in the Aguinda lawsuit. Chevron only touched 16% of the 916 toxic waste pits the court-appointed Special Master found in his review of the evidence at trial; only a fraction of those were actually covered with the dirt. Instead of preparing some sort of estimate of how much the company should pay to clean up the mess it made, Chevron claims that the court-appointed Special Master's damages assessment to properly remediate the remaining pits is too high. Chevron prefers the Special Master lower the number to comport with the cost of running dirt over the oil sludge in the pits consistent with Chevron's shoddy method of clean-up in Ecuador.

This scam is why Pallares has been living in Miami for more than a year and might end up never returning to his country. Reis Veiga, who works in Miami as one of Chevron's top executives for Latin America, refuses to return to Ecuador to confront the charges against him.
Chevron is still using both men to play instrumental roles in advising the company in the Aguinda trial where their previous fraudulent conduct is at issue.

If this sounds familiar, that's because it is. Last year, Chevron paid to move one of its Ecuadorian contractors, Diego Borja, out of Ecuador after he was implicated in a sting operation against the judge overseeing the trial. Our sources in Chevron indicate that Borja now lives in a luxury mansion in a gated community near Chevron's headquarters. Borja now has an American lawyer paid for by Chevron to ensure he can never be questioned by investigators. There is some question as to whether Chevron implicated itself in obstruction of justice by moving Borja out of a country where he is now the subject of an official investigation.

Chevron has shown it will do anything to evade accountability for the humanitarian crisis it created in Ecuador. Now its employees seem to be rewarded for ducking out of countries where they face investigations or indictments. Just like the toxic dumping, Chevron operates on the principle that violating the law can pay handsome dividends.

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Chevron General Counsel Hewitt Pate Stumbles as Ecuador Problem Balloons Out of Control

Hewitt Pate

As we blogged earlier, Chevron's continuing desperation to do anything it can to derail the potential $27.3 billion liability it faces for destroying part of Ecuador's rainforest has backfired yet again –this week the company again was caught misrepresenting key facts about the court-appointed expert who conducted a damages assessment not to the company's liking. On Tuesday, Chevron announced it had "newly discovered" evidence that the expert who conducted the damages assessment, Dr. Richard Cabrera, owns a remediation company in Ecuador that stands to benefit from a clean-up should the plaintiffs win the case.

Like so many other breathless announcements by Chevron, the company's newest "discovery" ("new" despite the fact that Chevron has filed 28 prior motions to attack Cabrera, none of which has been successful) has turned out to be worth less than the paper that its press releases were printed on.

It turns out that far from a conflict of interest, Dr. Cabrera explicitly disclosed to the court that he was involved in remediation in Ecuador – a qualification that was properly cited by the court as one of the reasons why he was accepted as the independent expert in the first place. Obviously, Dr. Cabrera would never be able to benefit from a clean-up related to a case he worked on given basic conflict of interest rules in Ecuador. But since Chevron cannot attack the technically sound evidence in the Cabrera report, which calls the company out for creating pollution that led to more than 1,400 excess cancer deaths, it tried to fabricate a distracting sideshow. For more details about Chevron's misrepresentations regarding Cabrera, see this response: http://chevrontoxico.com/assets/docs/2010-02-09-cabrera-response.pdf

The factual deficiencies of Chevron's allegations didn't stop the company from its ill-advised decision to "man up" and deploy Chevron Vice-President and General Counsel Hewitt Pate as its lead spokesman on the issue. Pate was featured prominently in Chevron's press materials and was put squarely in the middle of what should have been a low-level food fight between the long-warring parties. The fact that Pate, who is the general counsel of America's third largest company, is expending his political capital to bolster unsubstantiated allegations demonstrates how frantic the company has become about Ecuador. It also raises serious questions about the judgment of Chevron's legal department, where it seems to be a job requirement to prove your "machismo" through frontline interviews. Any other company would use a consultant or public relations firm to execute this type of messy media hit job.

So what's behind this? The answer is politics. Making up a press "event" out of facts that you misrepresent is a classic maneuver popularized by the Karl Rove School of politics. It turns out that Pate and his colleagues running the Chevron legal department all played central roles in the last Bush Administration. This is not a coincidence, as all of these individuals looked like they picked up a trick or two from Rove during their years of government service.

Chevron has a major distinction among the world's super-major oil companies: while most hire their general counsels from within their own legal department after years of service, or from prestigious outside law firms populated by lawyers experienced in the ways of the energy industry, Chevron stands alone in hiring political lawyers out of Republican Administrations. The last two general counsels for the company (Charles James and Pate) have been hand-plucked from the Bush administration's Justice Department, where they worked closely with former Attorney General John Ashcroft. James, who worked closely with Pate in Washington and hired him for Chevron, has a reputation from Washington to San Francisco as being a hard-right political ideologue.

James made the decision to hire as Chevron's deputy general counsel Jim Haynes, one of the Bush Administration "torture lawyers" under potential indictment in Spain and now unable to travel abroad for fear of arrest. While Chevron keeps Haynes swept under the rug for public image purposes, speculation on the street is that he is running the day to day in Chevron's in-house legal department. He clearly learned a lot about Chevron's conception of human rights by providing the legal justification for torture to a Rumsfeld-led Pentagon, where he served as General Counsel before being blocked by the Senate for a federal judgeship because of his infamous memo justifying waterboarding.

With these personnel moves, Chevron has elected to build a general counsel's office that is filled with right-wing lawyers who have relatively little experience in complex litigation matters. It turns out that since Chevron's legal team is led by political ideologues, the company is trying to find a political solution to a legal problem. It hires outside law firms who, to obtain Chevron's lucrative business, fall all over themselves to enable this distorted and ineffective conception of politics-as-litigation. That's why Chevron keeps stubbing its toes over Ecuador. That's why it has lost five straight times before U.S. federal courts, including before the U.S. Supreme Court, in its increasingly futile effort to get any judge anywhere to grant the company some sort of relief. That's also why Chevron's latest gambit to take the entire Ecuador matter to an international arbitration panel, without the presence of the Amazon communities, now risks getting torpedoed in U.S. federal court. The ham-fisted approach championed by James and now Pate is one reason why the Ecuador liability has ballooned out of control for Chevron and threatens about 20% of the company's market value.

Chevron must realize that the old days of using political influence to quash legal cases in far-flung countries is winding down. In Ecuador, those days are clearly over. In the United States, the method doesn't work. The fact Chevron uses its new general counsel's limited credibility to distort basic facts shows how "quaint" Chevron is compared to its industry peers, most of whom (perhaps not coincidentally) reported far better financial results last quarter. "Quaint" is how former Bush Administration lawyers such as Chevron's Haynes and Alberto Gonzales – folks who never served in the armed forces themselves -- used to describe the Geneva Conventions when justifying those "harsh interrogation tactics" that the world considered torture. Most Americans would consider such talk profoundly unpatriotic, but in Chevron's legal department that's probably what passes for typical chatter around the water cooler. That, and the excitement generated by the Sarah Palin sighting at the latest Tea Party convention.

Since lost lives don't seem to have much impact on the thinking at Chevron, how many billions of dollars will have to be garnished before Chevron's Board wakes up to this internal hazard?

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Twenty-Six Members of Congress Ask USTR to Reject Chevron Interference in Landmark Ecuador Legal Case

House Members Express "Concern" About Oil Giant's Effort to Use Trade Policy to Deny Due Process in Environmental Lawsuit

WASHINGTON--(BUSINESS WIRE)--Chevron has been dealt a major setback in the Congress as more than two dozen representatives, led by Rep. Linda Sanchez and including powerful senior members, have signed a letter urging that the United States Trade Representative reject efforts by the oil giant to cancel Ecuador's trade preferences. Chevron has pressured the USTR and Congress for years to revoke or curtail Ecuador's preferences in retaliation for a lawsuit brought by 30,000 Ecuadorian citizens alleging that Chevron dumped billions of gallons of toxic waste into the rainforest over a period of more than 20 years.

Separately, a one-year extension of the trade preferences for Ecuador were approved in the House on Dec. 14 on a voice vote – the fourth consecutive year Chevron's lobbying effort against Ecuador appears to have failed. The Senate is expected to formally approve the measure by the end of the year.

The letter to the USTR, sent December 15, expresses concern about Chevron's efforts to influence a private litigation which originally was filed in 1993 in U.S. federal court by several Ecuadorian indigenous tribes and farmer communities, but was sent to Ecuador at Chevron's request in 2002.

"We urge you to reject Chevron's request and reaffirm that U.S. trade agreements will not be used as leverage to interfere in private claims progressing through Ecuador's legal process," the representatives wrote in the letter.

Among the 26 Members taking this strong stand with Rep. Sanchez were: the Chief Democratic Deputy Whip and Vice-Chair of the Energy and Commerce Committee's Trade Subcommittee, Rep. Jan Schakowsky (D-IL); the Chairman of the Human Rights Subcommittee of the Foreign Affairs Committee, Rep. William Delahunt (D-MA); eight Members of the Ways & Means Committee, including the chairman of its Oversight Subcommittee, Rep. John Lewis (D-GA); and eight members of the Appropriations Committee, three of whom also oversee State Department matters and Foreign Operations. Judiciary and Rules Committee Members also were among those lending their support.

Other members signing the letter were Reps.: Lloyd Doggett (D-TX), James McGovern (D-MA), Marcy Kaptur (D-OH), Earl Blumenauer (D-OR), Danny Davis (D-IL), Sam Farr (D-CA), Steve Israel (D-NY), Raul Grijalva (D-AZ), Brian Higgins (D-NY), Phil Hare (D-IL), Hank Johnson (D-GA), Barbara Lee (D-CA), Betty McCollum (D-MN), Michael Michaud (D-ME), Jim McDermott (D-WA), James Moran (D-VA), Eleanor Holmes Norton (D-DC), Mike Quigley (D-IL), John Olver (D-MA), Lucille Roybal-Allard (D-CA), Betty Sutton (D-OH), and Fortney "Pete" Stark (D-CA).

Chevron is charged in the lawsuit with dumping more than 18 billion gallons of toxic waste into Amazon waterways and abandoning more than 900 unlined waste pits when it operated a large oil concession in Ecuador's Amazon from 1964 to 1990. A team of independent, court-appointed experts has estimated that at least 1,401 individuals have died from cancer related to exposure to the contamination and determined that damages could reach as high as $27.3 billion, according to a 4,000-page report turned over to the court last year.

The members of Congress write: "We do not prejudge the outcome of the case, nor do we take a position on the litigation. We do believe, however, that tens of thousands of indigenous residents of Ecuador who have brought this case deserve their day in court. We further believe that the USTR should not interfere in an ongoing judicial matter, particularly when this case involves environmental, health, and human rights issues that have a regional, and even global, importance."

Even though Chevron filed 14 expert affidavits in U.S. federal court praising Ecuador's court system to get the case transferred, once the evidence in the Ecuador trial pointed to the company's culpability it began a lobbying campaign in Washington to have Ecuador's preferences canceled. Chevron's lobbyists have made misleading assertions to the Congress that the company was granted a release from claims after a limited environmental clean-up in the mid-1990s, even though the release does not apply to the private claims in the lawsuit and the clean-up itself was fraudulent, according to the plaintiffs.

The ultimate goal of Chevron's Washington lobbying campaign was to pressure Ecuador's President, Rafael Correa, to interfere in his country's judiciary and quash the case as a way to maintain more than 300,000 jobs in Ecuador that are dependent on the preferences, according to Steven Donziger, an American legal advisor to the plaintiffs in the legal case.

"Chevron was trying to pressure Ecuador's President to violate his own Constitution and interfere in a private litigation to benefit the company in its battle with indigenous groups decimated by Chevron's pollution," said Donziger.

Chevron's lobbying campaign has sparked strong reactions across Capitol Hill and in the media.

On November 17, in testimony before the trade subcommittee of the Ways and Means Committee, Rep. Sanchez called Chevron's lobbying "extortion" and said, "Apparently, if it can't get the outcome it wants from the Ecuadorian court system, Chevron will use the US government to deny trade benefits until Ecuador cries uncle."

A recent editorial in the Los Angeles Times editorial blasted Chevron, noting that "If ... Chevron has its way, Congress will instead punish Ecuador because its government refuses to halt a private lawsuit against the oil giant.... to force a favorable outcome in a private claim would justly generate international outrage."

In 2006, then-Senator Barack Obama and Sen. Patrick Leahy wrote a similar letter to the USTR asking it to reject Chevron's petition, which it did.

Experts believe the Ecuador contamination – which covers an area the size of Rhode Island -- is the worst oil-related disaster on earth and would take at least two decades to properly clean. A final judgment in the case is expected next year.

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Chevron’s Ready-Made Scandal Continues to Fall Apart

New post from Paul over at ChevroninEcuador.com:

Chevron's Ready-Made Scandal Continues to Fall Apart

A new Associated Press investigation revealed that the purported environmental remediation specialist, Wayne Douglas Hansen, who secretly filmed meetings meant to catch Ecuadorian officials in acts of corruption has never owned a remediation company—as claimed—nor does he have any relationship with Honeywell Inc. as claimed in one of the videos.

AP reporters interviewed Hansen on the phone earlier this month. When they asked him the name of his company, he refused to answer. He instead described water treatment projects he is working on in Mexico and Ecuador. When the reporters questioned him about details of these projects, he hung up.

The AP investigation also uncovered Hansen's repeated run-ins with the law, ranging from letting his pit bull go wild on a neighbor's dog, to conspiring to smuggle 275,000 pounds of marijuana from Colombia into the United States! (He was convicted and served time in federal prison.)

The investigation shatters Chevron's attempt to portray Hansen as a sincere, concerned citizen who hand delivered the supposed bribery videos out of a sense of civic duty.

A parallel plaintiffs' report on Hansen was also published today, going into exhaustive detail on the information recently uncovered.

What remains to be uncovered is: one, the extent to which Hansen's involvement in the video scandal constitutes a federal crime for violating the Foreign Corrupt Practices Act and two, whether Chevron knowingly participated with Hansen in illegal activity to get their hands on a "smoking gun."

– Paul

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Chevron’s “Good Samaritan” is a Drug Trafficker and a liar…

An article in the New York Times today outlines the latest findings about the American, Wayne Hansen, who supposedly owned a remediation company, and who Chevron claimed made secret videotapes to expose "corruption" out of the goodness of his heart. Well, turns out that almost everything the guy said about who he was and who Chevron claimed he was is a lie – he does not own a remediation company, he has never done any remediation, and he is a convicted felon (For trying to smuggle 275,000
pounds of drugs).

And this brings up a serious question: if the guy isn't who Chevron says he is, and if he wasn't actually looking for remediation contracts (since he didn't have a remediation business), what was he doing in meetings, asking leading questions, while he secretly videotapes it? Why was he in that room? More and more signs are point towards Chevron, the only party that benefited from Hansen's attempt to undermine the trial in Ecuador.

Read on, from the Times:

October 30, 2009

Revelation Undermines Chevron Case in Ecuador

By CLIFFORD KRAUSS

HOUSTON — An American whose secret recordings have placed him at the center of a $27 billion lawsuit against Chevron in Ecuador is a convicted drug trafficker, records show, throwing another complication into a case already tainted by accusations of bribery and espionage.

The lawsuit pits Ecuadorean peasants against Chevron over oil pollution in the Amazon and has been a major headache for the company for nearly a decade, producing a saga that underscores many of the hazards and ethical challenges of oil companies working in the developing world.

The company appeared to gain the upper hand in August when it revealed video recordings — captured on watches and pens implanted with bugging devices — that suggested a bribery scheme involving Ecuadorean officials, and possibly even the judge hearing the case.

But the company was put on the defensive again on Thursday, after lawyers for the peasants revealed that one of two men who made the tapes was a convicted felon. Court and other records provided by the plaintiffs show that Wayne Hansen, the American who helped make the recordings, was convicted of conspiring to traffic 275,000 pounds of marijuana from Colombia to the United States in 1986. He also was sued successfully in 2005 by a woman who accused him of unleashing his two pit bulls to attack her and her dog.

The disclosure adds more questions about what motivated Mr. Hansen and an Ecuadorean partner to record meetings for Chevron's use, which the company has characterized as an act of whistle-blowing by men offended by unethical behavior and evidence that the handling of the case had been flawed.

"It's another blockbuster development in a case that never runs short of them," said Ralph G. Steinhardt, a professor at George Washington University Law School. "It doesn't necessarily mean there was no bribery plan, but anything that undermines the credibility of the witness undermines the case of the party that would call that witness."

Trevor Melby, Mr. Hansen's lawyer, did not deny his client had a criminal history, saying, "The thing about felony convictions is they follow you to the grave, but even if he had 15 felony convictions it wouldn't change the tapes." Mr. Melby said he was not being paid by Chevron.

The origins of the case go back to the 1970s, when Texaco operated in partnership with the Ecuadorean state oil company to produce oil in the Amazon. Peasants filed suit in 1993, saying that the company, which had ceased to operate in Ecuador by then, had left an environmental mess that had caused illnesses among villagers. Chevron bought Texaco before the case could be resolved.

Chevron has long said that it could not receive a fair hearing in Ecuador before a hostile judge and government. That argument seemed to be reinforced by the recordings obtained by Mr. Hansen and an Ecuadorean man who had worked as a contractor for the company. They showed an Ecuadorean political go-between working to obtain $3 million in bribes for environmental cleanup contracts to be awarded after the case ended.

But it remained unclear why Mr. Hansen was involved in the discussions. The plaintiffs said that an inquiry into his background by a private investigator found that Mr. Hansen did not hold an engineering license, never finished college and showed no record of being qualified to remediate pollution as he portrayed to Ecuadorean officials in the tapes.

Chevron has said it had no involvement in the videotaping, and company spokesmen have said Mr. Hansen was never their point of contact. "We've had no association with this guy," said Donald Campbell, a Chevron spokesman. "This issue is the content on the video and the transcripts that we turned over to the prosecutor general of Ecuador and the U.S. Department of Justice, which shows inappropriate meetings by the judge in our case, extensive government interference in the trial and a bribe plot involving $3 million."

The other man involved in making the recordings, Diego Borja, has since been moved to the United States with his family at Chevron's expense, and he has been receiving an undisclosed amount of living expenses.

No bribes were shown in the tapes, but the plot supposedly included Judge Juan Núñez, who was presiding in the case. Mr. Núñez recused himself, though he says he did nothing wrong.

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Chevron hit hard today by movie review in Washington Post

Interesting review of the movie "Crude" in today's Washington Post – the article really breaks down the way Chevron has handled the lawsuit to date. Take a look below or at: http://www.washingtonpost.com/wp-dyn/content/article/2009/10/22/AR2009102201443_pf.html

Not simply an underdog's tale

By John Anderson
Friday, October 23, 2009

Had Michael Moore wanted to make a serious movie about capitalism, he would have made "Crude." Joe Berlinger's scorched-earth documentary and David-and-Goliath drama offers more than a few eco-outraged observations on the not-so-free enterprise system: As the film very eloquently implies, when the greater good is defined as profits, and a lack of culpability is proportionate to your number of shareholders, well . . . a lot of petroleum-soaked chickens will be coming home to roost.

For three years, Berlinger followed the now-17-year-old lawsuit against Chevron filed by 30,000 indigenous Ecuadorans, and the results are an eco-war strategy as might have been devised by Sun Tzu. Witnesses are prepped, strategies are rehearsed, judges are buttonholed and celebrities are stroked -- and this is the strategy of the "good guys," as they probably would be defined by Berlinger. While both sides in the case certainly are given their voice, it's unlikely that the director -- who enjoys a lucrative commercial career in New York -- would have been inspired to leave hearth and home by his deep sense of injustice over the sufferings of Chevron.

And yet, "Crude" is that rare thing in fiction or nonfiction cinema, a movie that relies on its audience to draw the right conclusions. Chevron makes a decent case for itself: It wasn't even in the Amazon from 1972 to 1990, when an alleged 18 billion gallons of toxic wastewater were dumped there, sickening the inhabitants (notably the plaintiff Cofán tribe). But Texaco was, and Chevron took it over in 2001. And while much blame is assigned by all parties to the government-owned PetroEcuador, which has run the country's oil production since the early '90s, all the experts brought in to make assessments conclude that the damage is deep and old.

Chevron's motives are clear -- although the pending judgment against it is "only" $27 billion, it hardly pays to set a precedent and settle. When Pablo Fajardo, the lead attorney for the plaintiffs, and his associate Luis Yanza receive the prestigious Goldman Environmental Prize in 2008, a Chevron spokesman is heard calling them liars. Lawyers for the Ecuadorans admit that a Chevron defeat could mean big fees. When we see Chevron's agents -- such as counsel Ricardo Reis Veiga, who has since been indicted for fraud -- they admit nothing.

Berlinger ("Brother's Keeper," "Paradise Lost") lets it play out artfully. The fact that Chevron's representatives come across as soulless shills is hardly his fault; he lets them present their case without comment. It's hardly his responsibility to make someone such as corporation scientist Sara McMillan appear less reptilian when she contends that there's been no damage to the jungle, no oil-related illness, no correlation between pollution and death. From what the viewer can tell, Chevron is a little like the guy who performed a little surgery and stole your kidneys: What kidneys? Prove you ever had kidneys! If the movie is any indication, Chevron would have the public believe there was no Amazon at all -- something people might be willing to believe, were Berlinger not sticking "Crude" in their faces.

Anderson is a freelance reviewer.

*** ½ Unrated. At Landmark's E Street Cinema. Contains disturbing content. 105 minutes.

Whew. 3.5 stars (out of 4) for a film that Chevron and its shills keep trying to attack as just an anti-Chevron film. Maybe they try and go after the film because the company's arguments ring hollow - so rather than deal with the reality on the ground, the company encourages sympathetic bloggers like Carter Wood to attack the film. And therein lies Chevron's entire strategy (and the root of the company's problems): treat the situation in Ecuador as an image problem to be managed, rather than a humanitarian and economic crisis to be solved.

Hopefully the film will start to wake the company up to the reality: they made a mess in Ecudor, and they now need to clean it up.

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Today’s Bribery Tale Very Different from the One Chevron Told Seven Weeks Ago…

The tale that Chevron told about how two men secretly recorded a bribery scheme in Ecuador is a very different tale today from the one Chevron unveiled seven weeks ago on YouTube and through the news media. Chevron's attempt to use the bribery scheme to derail a potential $27 billion lawsuit for oil contamination in the Ecuadorian rainforest could turn out to be as big of a corporate scandal as the pretexting debacle at Hewlett Packard.

Below is a quick comparison of Chevron's original version of the story and what we know today. For more information, take a look at this complete list of Chevron's unanswered questions about the purported bribery scandal, and this compilation of media reports about the purported bribery scandal.

What Chevron Said Seven Weeks Ago:

• Patricio Garcia is a government party official who met at the party's headquarters office in Quito with Borja and Hansen
  

  
  

• Diego Borja is [only] a former Chevron logistics contractor
  

  
  

• Wayne Hansen, is an American business man who was looking for remediation work in Ecuador.
  

  
  

• Borja and Hansen have not received any payment for secretly taping Garcia in meetings.
  

What We Know Today:

• Garcia is not even a registered party member, much less a party official. Government party officials know of no formal role Garcia has played with the party, except to hand out flyers or cater events.
  
  
• Garcia, Borja and Hansen did not meet at the party's headquarters office; they met at a house owned by Garcia and at Borja's office.
  
  
• Garcia said Borja's office is in the same building as Chevron's legal team in Quito and that Borja's family owns the office building.
  
  
• Borja is not just a "former logistics contractor" for Chevron. He worked on the lawsuit for Chevron, helping to obtain soil samples for contamination testing as recently as March, only a few weeks before the first meeting with Garcia was secretly recorded.
  
  
• If Hansen is a businessman with an expertise in oil clean-up work and who owns his own remediation company, he does not advertise his services. (Chevron has confirmed that the only "Wayne Hansen" listed on any internet search engine is not the same Wayne Hansen who filmed the meetings.)
  
  
• Nowhere on the video recordings do any government officials, the plaintiffs or the judge discuss or accept a bribe.
  
  
• Despite what Chevron said about not paying for their services, Chevron paid Borja relocation expenses for him and his family to move to the US and for "interim support." Chevron has offered to pay both men's legal fees for the two top criminal defense lawyers Borja and Hansen have hired. The lawyers work in San Francisco, only a few miles from Chevron's headquarters in San Ramon.
  

Note that Borja's attorney, Cristina Arguedas, represented Hewlett Packard's former general counsel Ann Baskin in the pretexting scandal.

Chevron should pay attention - they may end up needing Arguedas' help as well…

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Chevron: Don’t believe your eyes…believe our lies!

Chevron's bloggers, who continue to deny the truth about the company's involvement in oil contamination in Ecuador, are upset with a New York Times photo of a waste pit in Ecuador that ran last Saturday.

Chevron apologists such as Carter Wood – who blogs for the National Associat

ion of Manufacturers, which counts Chevron as a major donor – have said the photo is of a waste pit by Ecuador's state-owned oil company, Petroecuador, because the oil is fresh and Chevron left the country in 1992. But in his hurry to carry Chevron's water, Carter again misses the boat with his analysis.

Evidence at the trial demonstrates that Chevron's predecessor company, Texaco, constructed 916 unlined waste pits in Ecuador's Amazon in the 1970s and 1980s. All were gouged out of the jungle floor without lining, in violation of U.S. and industry standards dating to the 1920s. Almost all of the pits had pipes that ran the toxic contents into nearby streams relied on by the local population for drinking water; in most cases, the toxic contents have migrated through the bottom of the pits to contaminate groundwater used for wells by local residents. If you want to see for yourself, check out the 60 Minutes report on the case.

This is clear evidence of the reckless indifference to human life that characterized Texaco's operations and Chevron's defense. Texaco had so little regard for the locals that Chevron had to admit that Texaco never even kept a list of the existence or locations of the pits, each of one of which is a hazardous waste site. The use of these reckless operational practices might explain why several independent health evaluations show skyrocketing rates of cancer in the region, and why the court Special Master found 1,401 excess cancer deaths. If this had happened in the U.S. it would probably be considered negligent homicide – and those that designed and built this system would probably be in jail.

Not that Wood cares. According to him – in a line he lifted directly from Chevron's talking points - if the oil in the pit is liquid then it must have been put there recently, which means the NYT photo could not be of contamination in a pit that Chevron left Ecuador in 1992. That's simply not true, according to evidence at trial. Dozens of Texaco waste pits in Ecuador's Amazon that were never touched by Petroecuador look exactly like the one in the NYT photo – even pits closed down by Texaco in the 1970s and 1980s. Check out this picture (taken in 2005), which is of Texaco site "Lago Agrio 5" which was closed in 1972 – and which hasn't been touched by anyone since it was closed by the company that year. Oil in old pits does not weather in Ecuador because it rains constantly in the Amazon, keeping the sludge in the old waste pits in the exact form one sees in the NYT photo. Even if the pit is now owned by Petroecuador, it does not absolve Chevron of its responsibility for building it, operating it, and abandoning it – and for the continued damage caused by using the same methods by the subsequent operator.

Chevron and bloggers like Carter Wood have consistently lied and misled the public, shareholders, and the media about Chevron's role in Ecuador. Chevron has tried every trick in the book – from creating its own news reports designed to look like CNN reports (including hiring disgraced former CNN correspondent Gene Randall to give the recordings an "authentic" appearance), to its latest Nixon-style dirty tricks operation to undermine the Ecuador trial where Chevron faces a substantial liability. Now, Carter Wood, on behalf of his organization's client Chevron, is asking people to not believe what is evident in a photo.

As Chevron's game of smoke and mirrors unravels, look for more misleading postings by Carter Wood and Chevron's cohort of bloggers. After all, Wood readily admits that he took an all-expense paid trip to Ecuador - paid for by Chevron of course - to get educated (read indoctrinated) on the issue. What he doesn't admit is that he failed to speak to any of the people who are trying to hold Chevron responsible for ruining their land and their lives. As a graduate of the Columbia School of Journalism, Wood should know better than to write about an issue without talking to both sides or disclosing that he is paid to support one party to a dispute.

So please Carter, stop trying to fool people with misleading arguments about oil liquidity and photos - people are not that stupid in the reality-based world.

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Chickens. Home. Roost.

It appears that William Haynes is probably getting familiar with those words – since it was announced today that the National Lawyers Guild San Francisco Bay Chapter (NLGSF) filed a complaint with the California State Bar against former Department of Defense General Counsel William Haynes. The complaint against Haynes, who now works for the Chevron Corporation in San Ramon, states that he "breached his duty as a lawyer and advocated for harsh tactics amounting to torture in violation of U.S. and international law … advocacy that directly lead to detainee abuses at the Guantanamo Bay and Abu Ghraib facilities." The complaint seeks to have Haynes held accountable for advising his clients (the Department of Defense) to take unlawful actions by engaging in torture by having his status as a "Registered In House Counsel" revoked – costing him his job as Chevron's deputy in-house counsel. And this is just the first wave – there is a real chance that Haynes will be called before Senator Patrick Leahy's burgeoning "Truth Commission," which could be America's very own Nuremberg trial to deal with the aftermath of the Bush wars.

This is hugely embarrassing for everyone at Chevron – but particularly for Charles James, Haynes' Bush-administration buddy who is Chevron's general counsel. James was the guy who hired Haynes when Haynes was radioactive after leaving the DoD under a cloud because of his torture connections. James made (another!) horrible judgment call in hiring Haynes, a potential war criminal, just as Chevron was facing a rising tide of human rights problems (Nigeria, Ecuador, Burma, now Cambodia) around the world. And like so many of James' other recent calls, this one is leaving him with egg on his face. It's pretty easy to imagine that the P.R. department over at Chevron is pretty pissed at James right about now for dragging their company into the same sentence as "torture" and "war criminal."

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A Multinational Oil Company: the Real Victim?

Chevron is looking for something new from America: sympathy. According to a blog following Latin American issues – The Latin Americanist – Chevron has issued a new press release claiming that the company is the true victim in the long-running dispute between it and 30,000 indigenous people of the Amazon rainforest region. Forget the fact that the people in the area are living in conditions similar to a toxic waste dump after more than 25 years of shoddy and unsafe oil drilling. And forget the fact that the people are dealing with a huge health impact from incredibly high cancer rates. And forget the fact that Chevron abandoned its responsibility to clean up the toxic waste it left behind. No, Chevron, a company that just booked a record $23.8 billion profit in 2008, is the victim – because the court-appointed independent expert thinks that it may cost $27 billion to repair the damage that the company left behind.

This isn't the first time Chevron has played this card. They first tried claiming they were the victim after two of the organizers for the plaintiffs – Luis Yanza and Pablo Fajardo – won the Goldman Award (basically the Nobel Prize for the environmental industry). And it didn't fly anymore than then it does now. Sourcewatch captured some of the public reaction to the last time chevron tried to play victim:

"For shame! Caught red handed perpetrating one of the worst environmental disasters in history, Chevron now goes on the offensive, calling itself the "victim" and blaming everybody but itself: the Ecuadoran government and courts, the indigenous people themselves, other oil companies, and "trial lawyers" (an irony for a hatchet job written by the company's general counsel, who oversees a huge litigation budget),"

"Scapegoating activists who won an international prize for pointing out the pollution you swept under your rugs and stacked in your closets is poor form and unworthy of the company your advertising insists you are,"

"Public relations can save you for the moment but you will end up as just another chapter in the history books of Corporate Criminality. Hope your grandchildren are better than you are."

But this reaction didn't stop Chevron from claiming that it was a victim again, this time whining that the court-appointed expert, Prof. Richard Cabrera, was unfair because his report found that the evidence supported what the plaintiffs were alleging. Chevron's infamous chief lawyer Charles James even has the gall to say that Cabrera has an "undeniable disdain for science." Pretty rich coming from a guy who hires the scientists who did the Tobacco industry stuff as his main advisors (Exponent Consulting is an infamous "product defense" science and engineering firm – but more on this another day). Not to mention the fact that Cabrera, the 14 other scientists on his team, the university where he is a tenured professor of geology, the 10 American scientists who have reviewed and confirmed the findings of the report, and the Court itself, may take issue with James' assertions that he has a disdain for science.

It seems clear that Chevron has taken the tact that anyone who thinks they did anything wrong in Ecuador is victimizing them – no matter how much evidence they have backing them up.

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Corruption: Shouldn’t We All Just Say No?

As I stumbled through the internet doing some follow-up research on the Foreign Corrupt Practices Act (FCPA) (following up on my post from a couple of weeks ago), as I was surprised to find that I'm not the first one to look to Chevron while investigating the FCPA: Charles James, the general counsel and head lawyer for Chevron recently spoke at U.C. Berkeley's law school, Boalt Hall, at a conference on global corruption.

While there wasn't a full transcript on the event, it seems from the summary of remarks that James identified himself as "not a big fan of the Foreign Corrupt Practices Act" and heavily criticized the enforcement of the law, seemingly arguing that when the law is enforced, companies like Chevron are at put at a competitive disadvantage.

James' remarks offered a very different perspective than the other panelists. Judith Miller, general counsel of engineering giant Bechtel corporation, argued that the short-term pain of losing business to companies that do pay bribes is well worth the payoff of curbing corruption, since bribes hurt the countries that receive them AND the companies that pay them (since the bribes retard development of the countries, encourage further corruption, and force the companies to incur additional operating costs to secure contracts). However, James doesn't seem to see it this way, only seeing the FCPA as putting Chevron at a competitive disadvantage because they can't legally pay foreign officials for preferential treatment.

You would think a company running a massive p.r. campaign to show their good corporate governance – the "human energy" initiative – would embrace the FCPA. But under Charles James, I guess not.

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Charles James: Chevron's In-House Karl Rove

Since Scott Gilmore is doing a great job chronicling the day-to-day of the landmark human rights trial of Bowoto v. Chevron, I thought I would turn my attention to one of the masterminds behind Chevron's defense.

As this trial moves into the 4th week, one of the more interesting aspects of the Bowoto case has been the role played by Charles James, Chevron's General Counsel who is often found at counsel's table, sitting and watching. James is the highest-ranking African American in Chevron, serves on the company's management committee with CEO David O'Reilly, and is considered a disciple of Karl Rove-style legal and political tactics. A product of the current Bush Administration, he served as an assistant attorney general for antitrust under John Ashcroft. One of the best examples of the importance (or lack thereof) James places on Chevron's image is his recent hiring of William J. Haynes, former General Counsel at the Pentagon under Defense Secretary Donald Rumsfeld (gotta wonder if Dick Cheney is next on his "to hire" list). Haynes signed off on the infamous "torture memo" that permitted waterboarding. The irony is that Chevron now has a suspected human rights violator -- Haynes -- helping to run a legal department that is trying to beat back charges that Chevron is a human rights violator itself.

The Bowoto trial is an example of how Chevron faces the most high-profile human rights problems of any major oil company. Many believe it has to do with the fact that James, like Karl Rove, just doesn't seem to know how to finesse problems before they grow to such a point that they begin to create major risks for ownership. Some observers have opined that there is a clear parallel between James' insensitivity and clumsiness and Rove's divisive and aggressive tactics.

This lack of finesse may help explain why in the present case, Chevron finds itself on trial in San Francisco (of all places!) for helping the Nigerian military kill peaceful, apparently unarmed, protesters who had occupied an oil platform. It also helps explain why Chevron's environmental problems in Ecuador's rainforest have grown to the point where the company faces a $16.3 billion potential liability, according to an independent court-appointed expert. Chevron is also under attack for owning a pipeline in Burma that generates close to $1 billion annually for that country's brutal military regime.

James' response to these problems is simple -- he just bludgeons all of the company's opposition. He has repeatedly relied upon the same strategic playbook -- "deny everything, admit nothing, attack, attack, attack" -- each time Chevron is confronted with its human rights violations. In Ecuador, the court-appointed expert found 428 people had died from exposure to oil contamination and two of the company's lawyers are under criminal indictment for lying about the results of an earlier remediation. Yet to James and his group, everyone who challenges Chevron on human rights grounds is either a pirate, a liar, or a con man. (Larry Bowoto has been repeatedly described as a "pirate" throughout the case; Pablo Fajardo, the lead lawyer in the Ecuador environmental case, was called an "environmental con man" by Chevron earlier this year after winning the Goldman Award, the environmental movement's version of the Nobel Prize.)

So the question is: Is James acting in the best interests of Chevron's shareholders? The fact that this is even a serious question tells one how far Chevron has fallen in recent years. We now live in a world where globalization makes issues regarding human rights, the environment, and corporate responsibility directly related to a corporation's competitiveness. While Chevron is faced with increasing human rights problems, competitors BP and Shell have significant, comprehensive human rights standards in place. As oil companies are forced to negotiate exploration agreements with increasingly sophisticated governments, Chevron's reputation will necessarily affect its competitive standing -- since communities will look to partner with corporations that can generate the most profit while causing the least amount of environmental devastation. After all, given the recent mandate spelled out in the recent election results, with Democrats now in control of Washington and the country is hungering for a new energy policy, having Bush Administration retreads like James and Haynes run an oil company's legal department seems at best bizarre and at worst foolish.

In regard to the Ecuador case, James once told law students at Berkeley that Chevron will fight "until hell freezes over, and then skate on the ice". While this is a suspect stance for any lawyer to take in public, it is even more disturbing when viewed as an aspect of James' overall philosophy. His inability to head off legal disputes has cost the company millions in fees and has left it with huge potential financial and public relations liabilities.

Regardless of how the Bowoto trial turns out (and Chevron should win the legal case -- no matter what the venue, their resources alone should all but guarantee their victory), the very existence of this standoff just miles from the company's global headquarters must be seen as a huge PR disaster for Chevron. It remains to be seen if the leadership ultimately responsible to the shareholders is taking note of the way that Charles James has masterminded this case.

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