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 Kicks Out “Runners for Human Rights” in Houston

Apparently Chevron is so hysterical about its impending legal disaster in Ecuador it has taken to infringing on free speech here in the United States. Take a look at this post from Han over at ChevroninEcuador.com:

Chevron pulls strings, kicks 'Runners for Human Rights' out of pre-Chevron Houston Marathan expo

Our friends at Rainforest Action Network (RAN) have recently joined the effort to demand justice for the people of the Ecuadorian Amazon suffering from Chevron's massive contamination of their rainforest communities. In true RAN style, their first big public initiative is smart and engaging– a handful of RAN activists are "running for human rights" in the Chevron Houston Marathon, taking place this Sunday. As part of the Chevron-sponsored (and thoroughly branded) marathon, the organizers present a big public Expo, at which the RAN runners paid for a table to distribute info about why they're running.

But at 10am this morning, before the Expo even opened, the RAN team – registered and credentialed – was threatened with arrest and kicked out of the Expo building by police. According to the RAN team, Chevron Marathon Managing Director Steven Karpas told them that "higher ups at Chevron are freaking out." And apparently, the Chevron big-wigs' "freak-out" was enough to deny the RAN team of their right to free speech and get them ejected from a building owned and operated by the city of Houston.

This is another pathetic example of Chevron throwing its weight around and resorting to dirty tactics in attempt to hide the truth from the public. Let's hope that Chevron won't be able to stop the registered runners from taking part in the marathon. And regardless, we know they'll do a great job raising awareness in Houston, with plans to unveil banners along the race route, and host a screening of the explosive documentary CRUDE in Houston. Read the full RAN press release after the jump.

RAN's press release:


For Immediate Release January 15, 2010

Contact: Brianna Cayo Cotter, Rainforest Action Network, (415) 305-1943 (in Houston)

Houston Chevron Marathon Marred by Denial of Runners' Free Speech


Runners for human rights barred from Chevron Houston Marathon Expo, threatened with arrest

Houston, TX – A team that is running for human rights in Ecuador at this Sunday's Chevron Houston Marathon was just kicked out of the marathon's Expo by Chevron Marathon Managing Director Steven Karpas. The runners had paid for a table to distribute "I'm Running for Human Rights" stickers and information about Chevron's refusal to clean up over 18 billion tons of toxic oil sludge they are responsible for in the Ecuadorean rainforest.

At approximately 10 a.m. this morning, Managing Director Steven Karpas told the Rainforest Action Network team, "higher ups at Chevron are freaking out" and threatened to arrest the peaceful runners. Police then ejected the runners from the city-owned and operated building for exercising their right to free speech.

"We are outraged that Chevron would deny marathon participants the right to run for what they believe, in our case, human rights in Ecuador," said Rainforest Action Network runner Maria Ramos. "It is sad that the Chevron Houston Marathon - which raises awareness and money for many important causes - would deny the rights of participants to appease a corporate sponsor that is clearly ashamed of its human rights record."

When asked for a reason for their ejection, Steven Karpas told the runners they were being removed for "protest activities." The Rainforest Action Network team's objective at the Expo was not to protest, disrupt the Expo or dampen other runners experience at this important race. The runners merely wanted to sit at their table and invite other runners to run with them for human rights.

While in Houston, Rainforest Action Network advocates will run in the race, unveil "Energy Shouldn't Cost Lives" banners along the race route, distribute "I'm Running for Human Rights" stickers to other runners, and host a free screening of Crude – the critically acclaimed documentary about the crisis in Ecuador – for Chevron employees and the Houston community.

Chevron is currently facing a $27.3 billion pollution judgment against the company in an Ecuadorean court over Chevron's toxic legacy in the Amazon rainforest. Just yesterday, representatives of Amazonian indigenous groups in Ecuador went to U.S. federal court in New York today to enjoin Chevron from initiating a closed-door international arbitration against Ecuador's government designed to eliminate the company's potential $27 billion liability for contaminating a huge swath of rainforest and devastating the local population.

– Han

Born and raised in Baltimore, Han Shan is a human rights and environmental justice campaigner living in New York City. He is currently serving as an organizer with the Clean Up Ecuador campaign for Amazon Watch.

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Chevron's Blogger Propagandists: Accuse First, Ask (No) Questions Later

(Originally posted by Amazon Watch over at www.chevroninecuador.com)

Chevron's Blogger Propagandists: Accuse First, Ask (No) Questions Later

We've written before about the motley crew of bloggers who fervently defend Chevron in its ongoing effort to run from a multibillion dollar liability for environmental disaster in Ecuador. Chevron is certainly not an easy company to stick up for, given its long and sordid history in Ecuador. Chevron's predecessor, Texaco, showed up in the pristine Amazon rainforest in 1964 and left a huge swath of it devastated and polluted by 1990. Chevron acquired Texaco, and its liability in Ecuador, in 2001 and is now the third largest U.S. corporation, with a 2008 profit of $24 billion. And yet this behemoth of an oil company loves to, ludicrously, play the victim card, and when it does, these are the bloggers who fall in line with PR-brushes in tow.

Chevron's blogger allies went into overdrive mode in September, trumpeting Chevron's claims when the oil major announced it had uncovered a $3 million bribery scandal that would implicate the Ecuadorian judge in corruption and, they claimed, prove government interference in the lawsuit. When the news hit, the pro-Chevron bloggers ran wild, crying foul, and trumpeting the Chevron line that a fair trial in Ecuador was impossible.

The only problem was, the smoking gun backfired. Instead of revealing a scandal, the videos themselves–and Chevron's role in presenting them to the media–became the scandal. As my colleague Han Shan documents in his thorough deconstruction of the company's allegations on Huffington Post, the whole "scandal" was nothing but a bizarre set up. By the end of October, it was clear that there was no actual bribe and no actual government officials were involved. Instead the videos merely document what appears to have been a plan to entrap judge Juan Nuñez and get him removed from the case. The man who presents himself as a businessman isn't, though he is a convicted drug-trafficker. The man he purports to bribe in the video is a phony government official (actually a car salesman). And the contracts they discuss were never signed and were proposed for a business that doesn't exist. Nice try, Chevron, but...

Since the bribery scandal imploded, there's been a curious silence from Chevron's merry band of bloggers. This isn't surprising. They're following a well-known propaganda strategy: make dramatic accusations with little supporting evidence, spread those accusations far and wide, then offer no retraction or apology when your claims are later proven to have been wildly off base...

More after the jump

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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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Amazing stories out of Ecuador these days - Time Magazine ran the most comprehensive piece we've seen thus far:

Ecuador vs. Chevron: Do the Videos Implicate the Judge?

Thursday, Sep. 03, 2009

Ecuador vs. Chevron: Do the Videos Implicate the Judge?

By Stephan Küffner / Quito

The lawsuit, the largest of its kind, has lasted 16 years, pitting U.S. oil giant Chevron against residents in the Amazon jungle of Ecuador. They accuse the company of massive petro-contamination of their communities in the late 20th century and seek $27 billion in damages, an amount that has turned nervous corporate heads worldwide.

But now, three months before a verdict is expected to be handed down, Chevron is doing the accusing, filing its own action with Ecuador's prosecutor general. It charges that the Ecuadorian judge in the case should be removed because, it claims, secretly recorded videos captured him admitting that he has already decided that Chevron is guilty — and they allegedly implicate him in a scheme to snag $3 million in bribes from firms hoping to win oil-cleanup contracts after his ruling. Also implicated are high-ranking officials in the government of leftist Ecuadorian President Rafael Correa, an outspoken critic of the U.S. (See pictures of the Amazon contamination that's at the center of the Chevron-Ecuador lawsuit.)

The videos, recorded in June, show Judge Juan Nuñez in meetings with two men, an American and an Ecuadorian, who are allegedly soliciting cleanup deals. Nuñez appears to be merely explaining to them the judicial process involved in the Chevron suit. But at one point he is asked by the American, businessman Wayne Hansen, if Chevron is el culpable — the guilty party. Nuñez, off camera, answers, "Sí, señor" — "Yes, sir." Says Charles James, executive vice president of Chevron, which posted the videos on the Internet on Aug. 31: "No judge who has participated in meetings of the type shown on these tapes could possibly deliver a legitimate decision." (See a video of how fungi can help clean up the petro-contamination in the Amazon.)

It is certainly questionable conduct for Nuñez or any judge to be discussing the landmark case with Hansen and the Ecuadorian, Diego Borja, in such cavalier fashion. In a newspaper interview, Nuñez denied that he told Hansen a predetermined verdict; his supporters say it's unclear in the videos, especially given Hansen's tortured Spanish, what exactly Nuñez is responding to. "This is a total trap on the part of Chevron," Nuñez said in an interview with Ecuadorian network Teleamazonas on Sept. 1. He acknowledged the meetings but said the secret videotaping was a setup, and he insisted that bribes were never discussed.

Although Chevron insists that it had no part in the secret videotaping, it turns out that Borja has worked for the company as a logistics contractor. "This entire episode reeks of a Nixon-style dirty-tricks operation, and Chevron's fingerprints are all over it," says Steven Donziger, a New York lawyer and adviser to the Ecuador plaintiffs. In his TV interview, Nuñez said that if Chevron "sent an employee" — the contractor Borja — that may mean a crime has been committed, since the law forbids him from meeting the parties in the lawsuit.

Nuñez is not present at another meeting in the videos in which men claiming to be influential members of Correa's ruling Alianza País Party lay out a brazen bribery conspiracy. They tell Hansen and Borja that $3 million in payoffs will be required to land a cleanup contract, divided evenly among Nuñez, Correa's office (including, said one of the men, the President's sister) and the plaintiffs. The Chevron complaint also fingered Correa's chief legal adviser, Alexis Mera, in the scheme. At a press conference on Sept. 1, Mera denied being involved and suggested that Chevron was simply trying to divert attention away from a case it knows it will probably lose. "The government won't succumb to these types of provocations," he said.

The Correa administration said Tuesday that while it had thus far seen no evidence of government corruption in the videos, it would investigate the matter "thoroughly, aggressively and fairly." On Wednesday, Ecuadorian justice officials announced they were opening an investigation into the possible government corruption, as well as whether the videotaping had violated laws. In any event, the scandal promises to delay the completion of a trial that has already spanned two decades and two continents. It began in the early 1990s in New York, after settlers and indigenous tribes in the Amazon oil towns of Coca, Lago Agrio and Shushufindi accused Texaco — which was bought by Chevron in 2002 — of recklessly dumping crude and wastewater into their lakes and rivers, seriously damaging the public health and livelihoods of tens of thousands of people. A court-appointed expert estimated the total damage to be a remarkable $27 billion, a figure Chevron says is baseless.

Ironically, Chevron in 2003 requested that the trial be moved to Lago Agrio, believing the conservative Ecuadorian government at the time would be more sympathetic. Indeed, in 1998 the government had declared that Texaco's $40 million cleanup of the sullied Amazon area was satisfactory. But three years later, Correa was elected, and Chevron has complained ever since that his administration has interfered in the case and prodded the judges overseeing it — including Nuñez, who took over last year — toward the plaintiffs.

Chevron executives have been under increasing pressure from shareholders who are fearful of an unfavorable verdict. But the scandal probably has the Correa administration chafing as well, especially since a tainted legal system could compromise its efforts to win most-favored-nation trade status from the U.S. Congress this year.

Either way, says Chevron spokesman Kent Anderson, Nuñez "needs to [recuse himself], and his past rulings need to be annulled." The plaintiff's lawyer, Pablo Fajardo, says the videos are an entrapment of Nuñez and show Chevron attempting to "undermine the trial process so the company can avoid paying a judgment." Says Donziger: "The bottom line [remains] that Chevron is responsible for wrecking Ecuador's rain forest. Nothing Chevron has presented in these videos changes these underlying facts one bit." Chevron's bet is that the videos will at least change international opinion about the court that's weighing those facts.

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Chevron’s New Shills

In a sign of frustration over their inability to convince any journalists with a semblance of independence or journalistic integrity to publish their talking points, Chevron has turned to paying faux journalists and bloggers to parrot the company's talking points and to do the company's dirty work in lobbing baseless accusations against the people bringing a landmark environmental lawsuit against the company.

In yet another instance of the company treating it's $27 billion legal liability in Ecuador as an image problem to be managed, rather than as an environmental and human rights crisis to be dealt with, Chevron has taken extreme measures over the recent past: hiring disgraced former-CNN anchor Gene Randall to put together a high-priced faux-news story that tries to fool viewers into thinking it's an independent news video, and paying for an all-expense paid trip for bloggers (including Carter Wood of Shopfloor.com, Bob McCarty of BobMcCartyWrites.com, Gail Tverberg of theoildrum.com, and Roger Alford of opinojuris.com) to Ecuador to participate in the company's propaganda tour.

[Update/Editor's Note: In the interest of clarity and fairness, while Roger Alford attended a trip paid for by Chevron, he has not written anything about this lawsuit, or otherwise opined on the issue.]

The result of Chevron's efforts? A number of posts that purport to be "news" that simply parrot Chevron's P.R. messages at the expense of any journalistic integrity that the "reporters" may have had.

Already Gene Randall, who traded on his familiarity as a former CNN anchor to create a fraudulent report for Chevron, has been publicly reprimanded in the New York Times, the Columbia Journalism Review, and On The Media, among other prestigious journalism publications. From interviews published in On The Media it appears that Randall has already resigned himself to counting his silver pieces to justify his loss of any public credibility that he may have had: "I didn't choose to leave CNN," Randall said, "and now that I have, I have to make a living somehow. So I offer my ability to use 'journalistic techniques' to clients who need to present their messages."

But perhaps more egregious than Randall's willingness to trade on his former association with CNN as part of Chevron's effort to manipulate public opinion, is the wholesale sale of their credibility that has occurred in the blogs over the past few weeks. The company has admitted to taking several bloggers on an all-expense paid trip to Ecuador to indoctrinate them in the company's messaging on the Ecuadorian lawsuit. The bloggers returned from the propaganda trip armed with a wealth of baseless accusations that they have lobbed at the indigenous people of Ecuador and the lawyers working with them. In true blogger fashion, almost none of these internet "journalists" bothered to consult with anyone other than Chevron before they started making their allegations. Instead, they simply sold whatever credibility and integrity they may have had to Chevron in return for a nice trip to Ecuador (or in McCarty's case – since he didn't actually go when he had to cancel, just the promise of a trip).

It will be interesting to see if the loss of integrity and credibility is worth the free flight that Chevron provided (hey – it might have even been first class…after all, the company did make $23.8 billion in profit last year).

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Chevron Praised Ecuador’s Courts for years and years…

until the company stood to profit by trashing them.

It turns out that long before Chevron picked up their new theme that "Ecuador's courts are biased" (no doubt a message that was refined in countless focus groups before Chevron's P.R. firms started pushing it out to you, loyal reader) the company spent years praising the courts, in an attempt to get the case transferred down to Ecuador. Turns out that Chevron loved the Ecuadorian courts - loved them just until evidence started being filed that showed that Chevron was responsible for the environmental and humanitarian disaster in the region. As soon as that happened, Chevron started their current messaging that Ecuadorian courts are corrupt and biased. Hmm – seems convenient for Chevron that Ecuadorian courts turned biased just as the evidence started revealing the depths of the environmental and humanitarian crime committed in the region.

But read for yourself – we're posting here the 14 sworn affidavits that Texaco (which Chevron merged with in 2001) filed in U.S. Federal Court praising the Ecuadorian courts as fair and unbiased. You can see for yourself exactly what Texaco (and now Chevron) thought about the Ecuadorian judiciary - right up until the company had a $27 billion interest in trashing them.

This is Chevron's M.O. - do anything, and say anything, you have to in order to avoid having to take responsibility for your actions.

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Thin Green Line: “What’s Not In Chevron’s Annual Report”

Great blog by Cameron Scott looking at another way to look at Chevron's annual report today at the "Thin Green Line" blog on SF Gate today: http://www.sfgate.com/cgi-bin/blogs/green/detail?&entry_id=40674

Reprinting here:

What's not in Chevron's annual report

People with strong ideological perspectives are often outraged by media coverage of their pet issues. When both sides are mad, you know you're doing something right. But how often do you hear corporations furious about they way they are covered in the business section? The section seems to lend itself to favor-currying and soft-shoeing.

In the lead-up to Chevron's annual shareholders meeting tomorrow in San Ramon, the company landed a puff piece on KGO focusing on its efforts to decrease its water usage. No mention of the Amazon controversy, and no mention of outside pressure on Chevron, EBMUD's largest water user.

I'm disappointed to say that a Chronicle
interview with the company's top lawyer also softballs the issues, while giving Chevron the opportunity to present its side of the story with no opportunity for response from the company's many critics. [Update: Chron editors tell me there will be more coverage of Chevron later in the week.]

Well, Chevron's opponents, including San Francisco's Amazon Watch, have taken matters into their own hands, releasing an alternate annual report that presents the externalities not listed in the company's balance sheet, which shows a record profit of $24 billion, making the company the second most profitable in the United States.

Did you know that Chevron's Richmond refinery was built in 1902 and emitted 100,000 pounds of toxic waste in 2007, consisting of no less than 38 toxic substances? The EPA ranks it as one of the worst refineries in the nation. With 17,000 people living within 3 miles from the plant, you'd think the San Ramon-based company would take local heat from more than just a couple dozen activists.

Chevron has sought to brand itself an "energy" company, one eagerly pursuing alternatives to petroleum. Its aggressive "Will You Join Us?" ad campaign asked regular folks to reduce their energy consumption, suggesting that Chevron was doing the same. In actuality, the company spent less than 3 percent of its whopping capital and exploratory expenditures on alternative energy. And it has refused to offer better reporting on its greenhouse gas emissions, despite strong shareholder support for it. (The aggressive, and misleading, ad campaign seems to have ired the report's researchers as well: The report is decorated by numerous parodies, and some have been wheat-pasted around town.)

It's a very well researched report, written by the scholar Antonia Juhasz, clearly divided into regional issues, and it's a much needed counterbalance to the friendly coverage Chevron is otherwise getting. (Juhasz was interviewed on Democracy Now this morning.)

For information on protesting the shareholder meeting early tomorrow morning, click here.

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Chevron Facing Potential Shareholder Revolt Over Ecuador

This press release was online today about Chevron's liability and how pissed some shareholders are about it. Take a look:

Chevron Management Dealt Major Blow with CalPERS Announcement on Ecuador

California Pension Fund Voting for Resolution Stemming from Chevron's $27 Billion Ecuador Liability in Rainforest

Pressure Grows as Funds from Connecticut, Philadelphia, Detroit Defy Recommendation of Chevron Management

SAN FRANCISCO--(BUSINESS WIRE)--Chevron is facing a shareholder rebuke at its annual meeting next week over the company's $27 billion Ecuador liability with the announcement that the nation's largest public pension fund in California is defying the recommendation of company management and voting for a resolution on the issue.

CalPERS, which owns an estimated $600 million of Chevron stock and controls $170 billion in assets, announced on its website today that it will vote for a resolution calling on Chevron to examine whether it complies with host country laws and environmental regulations. Chevron has been heavily criticized for violating such laws in Ecuador, leading to a humanitarian crisis among indigenous and farmer communities in an area of rainforest where Texaco admitted to dumping billions of gallons of toxic waste from the mid-1960s to the early 1990s.

New York State Attorney General Andrew Cuomo has also opened an investigation of Chevron to determine if it is misleading shareholders about the financial risks the company faces in Ecuador.

"The CalPERS vote is a significant announcement that puts enormous pressure on Chevron's management in the investor community," said Dan Orlow, a private American investor who is advising the Amazonian communities. "It demonstrates that important pension funds are now lining up against Chevron on Ecuador."

CalPERS and the two New York funds – the state's Common Retirement Fund and the Employees Retirement System of New York City -- are three of the largest public pension funds in the U.S. and together control more than $1 billion of Chevron stock. Other public pension funds that have announced their support of the resolution include those of Connecticut, Pennsylvania, Maryland, and the pension funds of firefighters and police in Detroit and other large cities.

Funds from three large unions -- the AFL-CIO, Teamsters, and AFSCME -- have announced their support of the resolution along with several smaller private funds, such as Trillium Asset Management in Boston.

The Ecuador liability, featured earlier this month on 60 Minutes in an unflattering report for Chevron, stems from the dumping by Texaco (now Chevron) of billions of gallons of toxic waste in the rainforest when it operated an oil concession from 1964 to 1990. Thousands of rainforest residents have been fighting a legal battle against the company for clean-up since 1993.

The case is in Ecuador at Chevron's request after it was initially filed by the communities in U.S. federal court. The company agreed to be subject to jurisdiction and be bound by any ruling in Ecuador as a condition of the case being transferred out of U.S. court, which makes the enforceability of a judgment out of Ecuador likely despite what the company is saying to shareholders, said Steven R. Donziger, an American legal advisor to the Amazonian communities.

The liability appears to be the largest ever faced by an oil company for environmental damage, and almost surpasses the $31 billion price tag paid by Chevron to purchase Texaco in 2001. Chevron's management has announced it expects an adverse judgment in the case but has said it would appeal, while the plaintiffs have announced they plan to ask the court to hold the amount of any judgment in escrow pending appeals – a move that could severely hinder the company's cash position in a time of relatively low oil prices, according to analysts.

Previously, the Securities and Exchange Commission denied an attempt by Chevron management to prevent the Ecuador resolution from coming to a vote.

The announcement by CalPERS comes the same week that Chevron's management filed with the SEC an open letter to shareholders urging them to vote against the Ecuador resolution. That letter – signed by Chevron Corporate Secretary Lydia I. Beebe – contains incorrect and misleading information and appeared to backfire, said Donziger.

"Each assertion in the Beebe letter is either false, materially misleading, or incomplete except for the part where the company admits it might lose the legal case," said Donziger.

"Our team is being contacted repeatedly by shareholders and analysts who are concerned that Chevron management is not fully and honestly disclosing the company's exposure in Ecuador," said Orlow. "There is a real concern that Chevron is not playing it straight and that it might have overpaid for Texaco."

The Cuomo investigation is being brought under New York's Martin Act, which allows for both civil and criminal liability for fraud. Several New York-based shareholders, including Amnesty International, had requested the probe to determine if the company's public disclosures complied with securities regulations.

The annual meeting is scheduled for May 27 at Chevron headquarters in San Ramon, CA. Indigenous leaders from Ecuador's Amazon are expected to attend and confront Chevron's management about Ecuador.

In past annual meetings, Chevron CEO David O'Reilly occasionally has treated the Ecuadorian visitors with a discourteous tone and shut down the microphone when they attempted to speak, said Donziger.

About the Amazon Defense Coalition

The Amazon Defense Coalition represents dozens of rainforest communities and five indigenous groups that inhabit Ecuador's Northern Amazon region. The mission of the Coalition is to protect the environment and secure social justice through grass roots organizing, political advocacy, and litigation.

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Hatchet job for Chevron in this week’s Economist…

An article in the Economist this week totally misses the mark about Chevron's liability in Ecuador. Not only did the reporter fail Journalism 101 by failing to talk to ANYONE from the plaintiffs, he or she (Economist articles have no byline) repeated word for word Chevrons story. This is the response by one of the lawyers working on the case – it gives some perspective on what was missing from the Economist fable:

This article buys into almost all of Chevron's misleading talking points and does your readers a huge disservice. Further, the article has numerous factual inaccuracies that hide the fact Chevron believes no court, government, or law has a right to hold it accountable for creating a humanitarian crisis in the rainforest. Perhaps the most important fact is the obvious one – the article repeats Chevron talking points, while a Chevron advertisement intermittently sits above the article on the Economist website.

This is some of what you got wrong or was taken out of context, from the perspective of a lawyer working on the case:

It is indisputable that Texaco used the Amazon as a trash bin for the 26 years that it operated a large oil field in Ecuador. The company admits to dumping more than 16 billion gallons of toxic "water of formation" into Amazon waterways and leaving over 900 toxic waste pits that leach toxins into soils and groundwater to this day. Several independent, peer-reviewed studies (as opposed to Chevron's financed studies) show a strong elevation in cancer rates in the oil-producing region that are correlated to hydrocarbon contamination. There is indisputable evidence that the practices Texaco used in Ecuador had been outlawed for decades in the U.S. Texaco's practices violated Ecuadorian law, U.S. law, industry custom, the company's contract with Ecuador's government, and basic human decency. More than 1,400 people have died of cancer, according to empirical data based on a court survey. Several indigenous groups have had their cultures decimated. The lawsuit, filed in U.S. court in 1993, is about seeking compensation from the company for these damages.

You totally missed Chevron's bad faith in the litigation. Chevron fought for nine years to move the trial to Ecuador from U.S. courts. It submitted 14 expert affidavits praising Ecuador's courts as fair and adequate. It agreed to submit to jurisdiction in Ecuador and be bound by any ruling there as a condition of the case being transferred. Only when the trial evidence in Ecuador began to point to Chevrons' culpability did those same courts suddenly become unfit for Chevron. The company tries to delay, attack, and distract because the evidence shows 100% of the former Texaco sites are highly contaminated with cancer-causing carcinogens. Chevron also has launched lobbying campaigns in Washington and Quito to help it accomplish in the political arena what it cannot accomplish under the rule of law – namely, engineer a victory via political pressure. What bothers Chevron about Ecuador's President is that he won't do its bidding, he won't interfere in the litigation, and he won't cut a side deal with the company unlike other Presidents from years past that allowed Texaco to run roughshod over the country's citizens.

Chevron's remediation, the basis of its "defense" at trial, was a total sham. At 100% of the so-called "remediated" sites inspected during the trial, high levels of toxins in soil and water have been confirmed by independent laboratories. Chevron created bogus laboratory results to "certify" the pits as cleaned, leading to a criminal indictment of two former Texaco lawyers. The "release" received by Chevron for the so-called remediation excludes the private claims of the type being litigated in the lawsuit. Chevron is lying to shareholders and journalists when it claims it was "released" – no court in the world has ever accepted Chevron's argument on this point, despite being presented countless times over the last 13 years.

Finally, the court-appointed expert maligned in your article is one of the most respected environmental consultants in Ecuador. He is so good that Chevron paid him as its expert in an earlier phase of the case. He worked with a team of 14 independent scientists to come up with a damages assessment. More than 25 scientists have reviewed the assessment and found its conclusions reasonable and the damages figure consistent with other large environmental clean-ups. Your claim that Texaco made less than $500 million profit is preposterous and illustrates your shoddy research. That amount was made by Texpet, Texaco's fourth-tier subsidiary in Ecuador. Texaco itself made an estimated $25 to $30 billion in profit in Ecuador.

Let's be clear – the Economist approached this story with a bias, and never contacted a representative of the communities. Chevron is a leading advertiser for the Economist. You owe your readers an explanation.

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Chevron caught manipulating media…

By the New York Times no less…the paper today picked up how Chevron has tried to manipulate the media: When Chevron Hires Ex-Reporter to Investigate Pollution, Chevron Looks Good.

But the times missed the real story and lets Chevron off the hook about how the company totally and completely fails to disclose that they paid for the piece in any aspect of the "report" put out by local Chevron pet reporter Gene Randall. Take a look at this press release describing the real story here:

Chevron Produces Phony Online News Coverage to Spread Misinformation about Ecuador Disaster

Oil Giant Fails to Disclose That It Paid for "News" Video Narrated by Former CNN Correspondent Gene Randall

Amazon Defense Coalition
3 May 2009 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at 703-798-3109 or karen [at] hintoncommunications.com

To obtain additional background about Chevron's oil contamination in Ecuador, click here to download a press kit

Washington, D.C. (May 3, 2009) –To promote a misinformation campaign about its role in the oil contamination of a pristine area of the rainforest in Ecuador, Chevron recently produced a video that copies the format and style of television news shows and portrays Texaco, now owned by Chevron, as completely blameless in the dumping of billions of gallons of toxic waste into the Amazon jungle.

Chevron has bought online advertising on Google to promote the 13-minute video ahead of the airing tonight of a 60 Minutes segment, reported by Scott Pelley, that is expected to expose the company's complicity in what is considered the world's worst oil-related contamination. Chevron never reveals it paid for the video, which is designed to look like an "objective" CNN news report and is narrated by former CNN correspondent and current corporate consultant Gene Randall.

Two environmental groups are blasting Chevron and Randall for engaging in the deceptive practice of producing a corporate news video that looks like a news broadcast. They called on Chevron to stop airing the video until the company makes a full disclosure.

"Chevron is using false information in this deceptive video to mislead the public, its own shareholders, and Chevron employees about its responsibility for an environmental disaster of epic proportions," Mitch Anderson, Corporate Accountability Campaigner at Amazon Watch, an environmental advocacy group in San Francisco.

"Randall should be ashamed to lend his credibility built up over years as a legitimate journalist to an oil company trying evade accountability for a disaster that is literally killing off indigenous groups and destroying the rainforest," added Anderson.

"If I were CNN, I would be furious because Randall essentially is getting paid by Chevron to use and dilute CNN's brand without permission."

Click here to view the video.

Chevron faces a potential civil liability of up to $27 billion for the Ecuador contamination in an epic 15-year trial in Ecuador's courts brought by dozens of indigenous groups and farmer communities. The damages assessment was produced by a team of 15 experts and is contained in a 4,000 page court report that analyzed the evidence in the case and places blame squarely on Chevron for the problems.

A final decision on the case is expected later this year.

The trial is taking place in Ecuador at Chevron's request after it was transferred from U.S. federal court in 2002. At the time, Chevron submitted numerous sworn affidavits praising the fairness of Ecuador's courts, although with a decision in the case imminent the company now claims those same courts are treating it unfairly.

The Chevron corporate video uses paid Chevron consultants and employees who cite discredited information consistent with the company's talking points on the case, said Karen Hinton, a U.S.-based spokesperson for the rainforest communities. Randall advertises himself as a producer and narrator of corporate videos with a "news flavor". (For more information about Randall, click here)

The Ecuadorian man who has led the communities in the battle against Chevron said the company should either pull the ad or inform viewers it produced it.

"Telling the truth isn't easy for Chevron because the company has put out much misinformation about the harm Texaco did to my country and its people," said Luis Yanza, President of the Amazon Defense Coalition, an Ecuadorian group that represents the plaintiffs in the lawsuit.

The hiring of Randall is not the first time Chevron has tried to use the veneer of the news media to promote its misinformation campaign. Chevron paid a little-known San Francisco-based online newspaper publisher, Pat Murphy, to write positive news article about Chevron in Ecuador without revealing Murphy was paid. Collaborating with Murphy has been the online blogger Zennie Abraham, known as Zennie 62, who parrots Chevron's talking points in his blogs. (For more information regarding Chevron's use of Pat Murphy and Zennie Abraham as proxies to dissiminate the company's propaganda, click here and here

Chevron has not denied charges that it funnels money to seemingly independent journalists, including Murphy and Abraham, to post what appears to be editorial content that is actually paid advertising.

The Chevron video misleads viewers on several important elements of the lawsuit, as demonstrated by evidence in the 4,000-page report prepared by a team of court experts, said Anderson. Some of the misleading facts are as follows:

• The video quotes Pedro Alvarez, a Chevron consultant, as saying the contamination in Ecuador poses no risk to public health. In fact, several parties – including Chevron – have found dangerous contaminants and carcinogens such as Chromium VI at levels thousands of times higher than allowed by law in Ecuador.
  
• The video falsely claims Texaco earned $490 million in profits from Ecuador. In reality, Texaco earned between $25 billion and $30 billion; Texaco's fourth-tier subsidiary, Texpet, earned $490 million.
  
• The video falsely claims the case was brought under law passed in 1999, after Texaco left Ecuador. In fact, it was brought under a provision of Ecuador's civil code dating to 1861 – a fact Chevron has admitted in court.
  
• The video claims Ecuador's courts are "unfair" but fails to reveal that the charge was made only after the evidence at trial started to point to Chevron's culpability. It also fails to disclose that Chevron argued as recently as 2007 in another case that Ecuador's courts are an adequate forum.
  
• The video claims that Ecuadorian lawyer Pablo Fajardo, who has won a CNN "Hero" Award for his work on the case, tried to stop Ecuador's state-owned oil company from cleaning Texaco's contaminated sites. In fact, Fajardo tried to get that company to clean the sites properly rather than just cover them with dirt.
  
• Chevron tries to claim the health impacts such as cancers are caused by fecal matter in the water. There is no scientific evidence to support the claim that fecal matter causes cancer.
  
• The video lies when it claims that the billions of gallons of water of formation dumped by Texaco were "treated" before discharge. In fact, Chevron's own environmental audits, in evidence in the case, show the water contained carcinogens and was not treated.
  

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