Chevron Imports The Great Ted Olson to Save Its RICO Case

Signs of More Serious Trouble For Oil Giant As It Tries to Evade Ecuador Judgment
 

There is now more evidence Chevron is running scared about its retaliatory New York RICO case filed against Ecuadorian villagers and one of their lawyers, New York attorney Steven R. Donziger.   The great Republican lawyer Theodore Olson – who argued the winning side in the famous Supreme Court case that landed George W. Bush the presidency – is joining the company’s legal team just days before a critical argument before a New York appellate court.

After an eight-year trial held in Ecuador at Chevron’s request, the Ecuadorian communities in 2011 won a judgment against the oil giant for causing massive toxic pollution to the Amazon, as summarized here and in this segment on 60 Minutes.  Chevron wants payback, but it is suddenly getting cold feet now that the Oct. 15 trial date is nearing. See here and here for more about Chevron’s sudden case of the jitters.

In an astounding move, Chevron recently disclosed that it is ready to drop all damages claims against the Ecuadorians and Donziger (who are being sued for $60 billion) just to avoid a jury of American citizens.  It is becoming abundantly clear that the facts of this case will never be Chevron’s friend.  The Ecuador court found that Chevron’s own scientific evidence and internal audit reports not only proved the claims against it, but also showed the company tried to obstruct justice by ordering employees to destroy incriminating documents. 

That’s why Chevron asked Judge Lewis A. Kaplan to rule the RICO trial will not include the overwhelming scientific evidence of Chevron’s contamination in Ecuador.  Kaplan granted Chevron’s request, essentially disabling any possibility of a meaningful defense in the case.  (The defendants want to use the scientific evidence to prove Chevron’s charges of fraud are baseless.)

Chevron’s new plan is to drop all damages claims so that Judge Kaplan can decide the case alone and provide the company with an injunction blocking the winners of the lawsuit from enforcing their judgment worldwide.  There are many problems with this approach, which we explain below. But a trial before Kaplan would virtually guarantee the company a temporary victory – however hollow and illegitimate it might be in the eyes of the world. 

There is a big problem - Judge Kaplan now faces an embarrassing motion for recusal that will be heard by the Second Circuit Court of Appeals on September 26 in Manhattan.  With the trial scheduled to start soon after, the timing is not good for Chevron.

With its options narrowing, Chevron’s desperation is almost palpable.

Just days ago, the company quietly notified the Second Circuit that Olson will replace Randy Mastro as the company’s lead appellate lawyer in the upcoming argument.  Mastro is the former New York City deputy mayor (under Rudy Guliani) and political operative whose trial skills earned his client a $19 billion adverse judgment out of Ecuador.

Olson comes from a different class altogether.  He is the former Solicitor General of the United States under the Bush Administration and has argued roughly 60 cases before the U.S. Supreme Court.   He joins an estimated 2,000 other Chevron legal personnel from the 60 law firms used by the oil giant to try to avoid paying for its toxic calamity in the Amazon. 

The other new Chevron team member for the upcoming argument is Michael Mukasey, the former Attorney General of the United States (also under the Bush Administration).  Mukasey has applied to appear on behalf of the U.S. Chamber of Commerce, an organization that in recent years has received millions of dollars in contributions from Chevron.  Mukasey is the former chief judge of the Southern District of New York, where Kaplan sits.

Olson and Mukasey are key members of our country’s Republican legal machine – the same machine that brought us Bush v. Gore and the unconscionable Swift Boating of John Kerry during the 2004 presidential campaign.  That the Republican dream team is now mobilizing to protect Judge Kaplan deserves attention. Without Judge Kaplan, there is real danger that Chevron’s house of cards will collapse and the plaintiff’s bar might finally hold an oil major accountable on a mass scale for crimes and wrongdoing overseas.  That’s never happened before.

We digress to note that R. Hewitt Pate, Chevron’s General Counsel, served in the Bush Administration with both Olson and Mukasey.  To illustrate the warped value system of Chevron’s management team, the company gave Pate a whopping raise to $7.5 million the same year his legal team was hit with a $19 billion adverse judgment in Ecuador.  Pate has also authorized Chevron to pay an estimated $1 billion in legal fees since 2009 to Olson’s law firm, Gibson Dunn & Crutcher, to lead the assault on the Ecuadorian villagers and their counsel.

For Chevron, the entire purpose of the RICO case is to create a “stink factor” that might muck up enforcement actions the Ecuadorians have filed against Chevron assets around the world to collect on their judgment.  Judge Kaplan has unabashedly promoted the RICO case at every turn, calling the Ecuadorians the “so-called” plaintiffs and saying Donziger’s goal is to “fix the balance of payments deficit” of the United States.  He also claimed the Ecuador case “is not bona fide” litigation.

Chevron recently disclosed to Kaplan’s court that it has at least 114 lawyers working on the matter at Gibson Dunn.  Donziger is representing himself pro se.  As far as we can tell, he and solo practitioner Julio Gomez (who represents the Ecuadorians) are doing a pretty good job of beating back the advancing Chevron army. 

We note the last time Chevron showed up before the Second Circuit the panel of judges reversed Judge Kaplan’s illegal global injunction purporting to block the Ecuador judgment worldwide.  Mastro literally was laughed out of court when he could not answer basic questions from the panel.

Chevron is now asking Judge Kaplan to ditch a jury and impose the exact same injunction that the Circuit previously said was illegal.   It makes no sense, and leaves us scratching our heads. This is increasingly looking like a chess game of giants in which Donziger and his clients are treated as pawns.

Olson normally would never show up for a regular recusal proceeding.  But there is nothing regular about this one. Judge Kaplan is a vital asset to Chevron as it attempts to fulfill its longstanding promise to tie up the Ecuadorians with a “lifetime of litigation” if they don’t drop their claims.  As famed lawyer John Keker (Donziger’s former counsel) said last May, Chevron is trying to win by might what it cannot win on merit. 

(For background on Ted Olson’s previous foray into the Ecuador case on behalf of Chevron, read this blog posting from October 10, 2012.)

Read More

Bribery Bombshell Threatens Chevron Legal Strategy In Ecuador Case

Late last week, lawyer Steven Donziger and the Ecuadorian villagers who have fought for decades to force Chevron to clean up its poisonous mess in their rainforest lands filed a motion in U.S. Federal court that could spell an end to the oil giant's legal maneuverings and attempts to evade responsibility for its toxic legacy in the Amazon.

According to the filing, Chevron has engaged in a “pattern of misconduct and corruption” including offering a $1 million dollar bribe to the Ecuadorian judge who ruled against the company in 2011, and ordered Chevron to pay $19 billion in compensatory and punitive damages.

A press release on Friday announced the bombshell revelations contained in the motion, which called for Chevron's retaliatory RICO suit—currently scheduled to go on trial in mid-October—to be terminated.

The filing outlines Chevron’s unlawful payments and bribes to witnesses and concludes that this conduct has “so damaged the integrity” of the proceedings that at this point, a fair trial is simply impossible.

“When the conduct is this egregious, there is simply no other way to ensure justice than to end the entire proceeding,” said Christopher Gowen, an attorney and spokesman who is advising the Ecuadorians and their attorney, Steven R. Donziger.

Supporters of the Ecuadorian indigenous and farmer communities who have suffered most from the massive oil pollution for which Chevron was found culpable, will be familiar with some of the cynical efforts the oil company undertook to corrupt the Ecuadorian legal proceedings since the trial opened in the oil boom town of Lago Agrio in 2003.

Last week's motion from the Ecuadorians and their US lawyer Steven Donziger lay out the sordid case of Chevron's admitted dirty tricks operative Diego Borja and the secret labs he helped set up to manipulate pollution sampling in the trial. The latest motion recounts the airtight evidence regarding Borja—including recordings of Chevron's former contractor admitting that the oil giant would lose the trial “like this” (with a snap of his fingers) if he revealed all the evidence he possesses of the company's guilt for contamination in Ecuador. But Chevron has paid Borja a staggering sum of $2.2 million in hush money, according to the filing.

But the bombshell in this latest motion is Chevron's attempt to bribe the judge who ruled against the company in 2011, after an epic 8-year trial. According to the press release:

One of the illicit payments – in the amount of $1 million -- was offered as a bribe to the Ecuador judge who wrote the opinion finding Chevron liable for $19 billion in damages for dumping toxic waste into the rainforest. The bribe was intended to coax the judge, Nicolas Zambrano, into renouncing his own ruling which was based on a 220,000-page evidentiary record accumulated over an eight-year trial, according to a sworn affidavit cited in the motion.

Zambrano intends to testify about the bribe offer in the RICO case should it proceed to trial as scheduled in mid-October, according to a recent court filing. Chevron filed the RICO action in New York federal court as a last-ditch attempt to thwart the Ecuador court judgment; the company was also countersued for fraud and extortion by Donziger, who has advised the Ecuadorians for two decades. (A summary of the overwhelming evidence against Chevron as found by the Ecuador court can be read here.)

The press release provides a summary of the evidence of Chevron’s illegal payments and bribes as outlined in the motion:

**Chevron lawyer Andres Rivero and another Chevron agent known as “Investigator #5” used a former Ecuadorian judge and key Chevron witness (Alberto Guerra) as a conduit to offer the $1 million bribe to Zambrano, whose sworn affidavit is available here. Rivero recorded himself paying Guerra thousands of dollars in cash out of a suitcase during a secret meeting in Ecuador. Guerra presided over the case for three months in 2003.

**Chevron signed a contract guaranteeing Guerra payments at least ten times his annual salary as an Ecuadorian judge in exchange for false testimony where he claims the Ecuadorian plaintiffs bribed him. The exorbitant payments were arranged directly in a meeting in Chicago by Randy Mastro, Chevron’s lead outside counsel at the law firm of Gibson Dunn & Crutcher. Mastro’s practice group already has been sanctioned once by a federal judge in the case for engaging in unethical conduct.

**The filing asserts that the benefits given to Guerra constitute criminal violations that run afoul of the Federal Anti-Gratuity Statute, which prohibits payments to non-expert witnesses for testimony. The argument that the payments to Guerra are illegal is supported by a sworn affidavit provided by Erwin Chemerinsky, a prominent ethics expert and Dean of the law school at the University of California, Irvine.

**The motion documents that Chevron, by its own admission, not only paid Guerra cash from a suitcase but moved his entire family to the United States; promised him an annual salary of $144,000, or roughly 30 times the per capita annual income in Ecuador; has provided him a car, health insurance, cell phones, a housing allowance, and payments for travel expenses and an immigration lawyer who happens to be none other than Ira Kurzbam, former President of the American Immigration Lawyers Association. Chevron appears to be helping Guerra seek political asylum in the U.S. under false pretenses, said Donziger.

**The motion also outlines $2.2 million in payments and “hush money” Chevron made to employee Diego Borja. Borja, who worked for Chevron’s legal team in Ecuador since 2004, has admitted on tape that he was the company’s “dirty tricks” operative during the Ecuador trial. He also admitted he tried to entrap a sitting judge in a bribery scandal, set up dummy companies, and that he and his wife ran a supposedly independent laboratory actually controlled by Chevron. For background on Chevron’s attempts to corrupt the Ecuador trial through Borja, see here.

**Chevron also used “coercion and the threat of financial ruin” to blackmail two U.S. scientists, Douglas Beltman and Ann Maest, into disavowing their prior sworn testimony that the oil company is responsible for extensive toxic pollution in Ecuador. Chevron even contacted clients of Stratus to falsely claim that the company had been found to have committed “fraud” in Ecuador as a way to pressure the scientists to “flip” to Chevron’s side.

**Chevron also engaged in witness tampering by coercing Christopher Bogart – a former financial backer of the Ecuadorians who runs a litigation hedge fund – to submit a false affidavit claiming he was misled about key parts of the underlying case. Bogart already has been discredited as a liar in a separate court filing that seeks to exclude his testimony.

According to the press release from Gowen, an American University law professor, Chevron is “reeling over the risk posed by its own RICO allegations given the obvious credibility problems of its witnesses.” Gowen also says that Chevron appears “utterly desperate” to avoid a jury trial in the RICO case.

Finally, the motion highlights the misconduct of the lawyers from Chevron's outside legal firm Gibson Dunn, & Crutcher.  It cites their “track record of presenting false or misleading testimony to U.S. courts on behalf of their corporate clients,” according to the press release. The motion requests legal sanctions of Randy Mastro, Andrea Neumann and Scott Edelman, who have been the architects of Chevron's legal strategy in their efforts to evade accountability.

With each passing day, Chevron looks increasingly desperate to avoid a jury trial in its retaliatory RICO suit.  Its best hope is for some sort of legal end-around that will allow its favored U.S. judge, Lewis Kaplan, to rule alone, virtually guaranteeing an outcome in Chevron's favor that almost certainly will not withstand an appeal. And with each passing day, the company's pathway to impunity for its crimes in Ecuador becomes more cluttered with roadblocks, fashioned from the perseverance of the communities in Ecuador's Amazon who continue to fight for justice.


For background on how Chevron decimated indigenous and farmer communities by dumping billions of gallons of toxic waste in Ecuador’s Amazon, watch this video overview or this 60 Minutes segment, or review this summary of the overwhelming evidence against the company.  Chevron is now fighting a $19 billion judgment against the company.

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.
Visit ChevronToxico.com to find out more.
Support Amazon Watch and Rainforest Action Network.

Read More

Ahead of Trial, Chevron Drops $60 Billion Damages Claim Against Ecuadorians in RICO Suit; Maneuvering to Avoid Airing of its Crimes in Ecuador

In a clear 11th-hour retreat that suggests it does not believe its own allegations, Chevron has taken the extraordinary step of pleading with a U.S. judge to block a jury from deciding its retaliatory “fraud” and RICO claims against Ecuadorian villagers and their U.S. lawyer. The company also said it was even prepared to drop a $60 billion damages claim if the judge agrees to deny the defendants a jury trial. Chevron's $60 billion figure is based on three times the $19 billion Ecuadorian judgement, plus costs.

Thus reads the introduction of a press release today—the headline: 'Bombshell Retreat: Chevron Seeks to Drop $60 Billion in Damages In Ecuador Case'—from the Gowen Group, whose founding partner Chris Gowen is serving as an adviser to the Ecuadorians and their longtime New York-based lawyer, Steven Donziger.

Chevron filed a series of motions over the weekend in the retaliatory lawsuit the oil giant filed against Donziger as well as the Ecuadorians whose names appear as representative plaintiffs in the original lawsuit against Chevron for massive contamination of their rainforest communities. Here is the motion dropping its damages claims against the Ecuadorians.

Adviser Chris Gowen said, “Chevron has shown over and over that its only legal strategy is to outspend everyone and continue to run from the law for another twenty years. When a litigant tries to avoid a jury, you can be certain that litigant knows it has no case. This is an extraordinarily telling moment that suggests a collapse of confidence in the Chevron camp.”

The press release continues:

Donziger and his clients have long contended that Chevron’s RICO case was a function of distorted and manufactured evidence helped along by Judge Kaplan, who has consistently made disparaging remarks about Ecuador’s judicial system. Donziger filed detailed counterclaims accusing Chevron of using the RICO case as a smokescreen to hide its environmental crimes, fraud and bribery attempts in Ecuador. (Kaplan has refused to let those claims go forward in the context of the RICO trial.)

And then it quotes Donziger:

“For three years, Chevron has used its RICO suit largely for public relations purposes to falsely taint the Ecuador case and tarnish my personal reputation. When it comes time to put their allegations to the test, Chevron chickens out and runs into the arms of its favorite judge for protection. The entire situation is an affront to American values.”

Advocates for the indigenous and farmer communities in the areas polluted by Chevron have for several years kept a spotlight on exactly why Judge Lewis Kaplan is what Donziger calls “its favorite judge.” He has shown shocking pro-Chevron bias; he calls the environmental lawsuit "a giant game" and the Ecuadorians the “so-called plaintiffs” and refers to them enforcing the judgment they won against the company by saying, "I don't think there is anybody in this courtroom who wants to pull his car into a gas station to fill up and finds that there isn't any gas there because these folks have attached [the company's assets] in Singapore or wherever else."

Donziger and the Ecuadorians have filed a writ of mandamus petition asking the 2nd Circuit Court of Appeals to remove Judge Kaplan for his impartiality in the case. On Sept. 26th, a 3-judge panel from the appellate court will hear arguments on the motion for Judge Kaplan's reassignment from the trial—that is, only a few weeks before the RICO trial is scheduled to begin on Oct. 15th. As the release states, “The scheduling of such an argument just before trial is a rare occurrence and suggests the higher court is watching Kaplan with great scrutiny.”

With these latest court filings, according to Donziger and his team, Chevron's goal is:

to have Kaplan conduct a rapid "show trial" that would bar Donziger and his clients from mounting a meaningful defense. Once Kaplan makes his expected “findings” against Donziger and the Ecuadorians, Chevron would then ask him to re-issue the same controversial global injunction purporting to bar worldwide enforcement of the Ecuador judgment that the Second Circuit Court of Appeals already ruled was illegal in 2011.

The most shocking stuff in Chevron's latest legal machinations is laid out plainly in their summary Notice of Motions in limine, which is an astonishing request to Judge Kaplan that he issues orders that would basically prevent Donziger and the Ecuadorians from mounting any sort of defense, or bring up any evidence of Chevron's contamination of the Ecuadorian Amazon, or its bad faith conduct during the trial in Ecuador.

Here is an excerpt:

Chevron requests that this Court enter an order:

• precluding Defendants from offering at trial evidence, arguments, or questioning in support of the proposition that the findings of the Cabrera report, the Ecuadorian judgment, or Defendants’ allegations in the Ecuadorian proceeding were accurate or supported by evidence and sound scientific analysis, including but not limited to a prohibition on the submission of evidence, arguments, or questioning regarding the following topics, except insofar as the evidence is otherwise relevant: 

• alleged environmental and human conditions in the Oriente region of Ecuador, including scientific or other studies, testing or sampling results, video or still images, or personal testimonies; and 

• the procedures employed in the TexPet Remediation, the efficacy of those procedures, or their compliance with agreements and with Ecuadorian law.

In the motion, Chevron shows real hubris going even further, asking Judge Kaplan to preclude the defendants from raising at trial:

• Chevron’s purported conduct in the Lago Agrio Litigation, including contacts with Ecuadorian government officials, arguments made by Chevron to the Lago Agrio Court, the cancellation and subsequent rescheduling of the Guanta inspection, Chevron’s purported “sting” operation against an Ecuadorian judge, Chevron’s use of a purported “sham laboratory”, Chevron’s purported “procedural misconduct” in filing motions in the Lago Agrio Litigation, Chevron’s purported ex parte contacts with Ecuadorian judges and court experts, any “harassment” supposedly suffered by Defendants or their co-conspirators, and any argument that their actions were justified by virtue of Chevron’s alleged misconduct; 

• Chevron’s conduct in this and other litigation in the United States, including Chevron’s purported misuse of Section 1782 to obtain discovery for use in the Lago Agrio Litigation, Chevron’s subpoenas to email providers seeking information about Defendants and their co-conspirators, and Chevron’s surveillance of Defendants and their co-conspirators; and 

• alleged promises and representations made by Texaco and/or TexPet in the Aguinda litigation.

You can read the entire motion here, and see how Chevron is hoping to abuse the judicial process in this RICO show trial, in a similar way that the company abused the judicial process in Ecuador, in an attempt to evade accountability for its disaster in the Amazon.

But the 2nd Circuit is watching. As are global supporters of the Ecuadorian communities. As are the communities themselves, who continue fighting for justice, despite the abuse they continue to deal with, from the oil-polluted environment they live in to courtrooms thousands of miles away.


For background on how Chevron decimated indigenous and farmer communities by dumping billions of gallons of toxic waste in Ecuador’s Amazon, watch this video overview or this 60 Minutes segment, or review this summary of the overwhelming evidence against the company.  Chevron is now fighting a $19 billion judgment against the company.

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.
Visit and watch a video on ChevronToxico.com to find out more.

Support Amazon Watch and Rainforest Action Network.

Read More

Appeals Court to Consider Removing Key U.S. Judge in Chevron-Ecuador Case

A New York appellate court has said it will consider a petition to reassign federal judge Lewis A. Kaplan from an Ecuador environmental case that resulted in a $19 billion judgment against Chevron.

A press release issued today by the DC-based Gowen Group law firm outlines this potentially game-changing legal update in the case. Founding partner Chris Gowen has taken up duties as an adviser to and spokesperson for Steven Donziger, the New York human rights lawyer who has earned the ire of Chevron for his dogged two-decade effort to bring the oil giant to justice for massive pollution and human rights abuses in the Ecuadorian Amazon.

The press release continues:

The Second Circuit Court of Appeals has set Sept. 26 for oral argument on the petition to reassign the judge, who has been criticized for unfairly promoting a retaliatory Chevron “fraud” case against Ecuadorians villagers and their U.S. counsel. The reassignment petition, which is based primarily on Judge Kaplan’s refusal to follow prior appellate court orders in the case, can be read here and here.

Judge Lewis A. Kaplan is presiding over a lawsuit brought by Chevron against Donziger, Ecuadorian community leaders and Goldman prize winners Pablo Fajardo and Luis Yanza, as well as dozens of the "named plaintiffs" in the original suit against the oil company. Most of the named plaintiffs are from indigenous communities living in an area of the Ecuadorian Amazon devastated by Chevron's oil pollution. These communities have seen their livelihoods destroyed by pollution, their culture decimated by rainforest destruction, and lost loved ones to cancer and other diseases related to the toxins Chevron has admitted dumping into their environment. But that hasn't stopped Chevron from retaliating, and Judge Kaplan has wondered aloud whether these people even exist.

From the press release:

Judge Kaplan has been accused of bias for calling the Ecuador case a "giant game" invented by lawyers to “fix the balance of payments deficit” of the United States. He also referred to thousands of indigenous Ecuadorians as the "so-called" plaintiffs before imposing an illegal injunction purporting to block the Ecuador judgment from being enforced anywhere in the world. For background, see here and here.

Judge Kaplan’s injunction was reversed unanimously in 2011 by a three-judge appellate panel, dealing a stunning rebuke to Chevron’s primary defense in the case. The current petition for reassignment explains how Kaplan has continued to defy that appellate order by issuing a series of decisions disparaging Ecuador’s judicial system.

Donziger and the other defendants in the Chevron's retaliatory RICO case filed what is called a petition for a writ of mandamus, asking the Appeals Court to remove Kaplan form the case due to the bias he has repeatedly shown towards Chevron.

Amazon Watch's Eye on the Amazon blog writes that Kaplan insinuates that an "important company like Chevron should be guarded from judgment collection efforts that apparently might be acceptable if the company were deemed less vital" and quotes Judge Kaplan from an early court proceeding:

"[W]e are dealing here with a company of considerable otherwise importance to our economy that employs thousands all over the world, that supplies a group of commodities, gasoline, heating oil, other fuels and lubricants on which every one of us depends every single day. I don't think there is anybody in this courtroom who wants to pull his car into a gas station to fill up and finds that there isn't any gas there because these folks have attached it in Singapore or wherever else."

Back to today's press release for comment from Chris Gowen, an adjunct professor at the Washington College of Law who is advising the Ecuadorians and Donziger: “Chevron is desperately suing everybody it can to evade a valid judgment won by the rainforest communities the company has contaminated with toxic waste,” he said. “Chevron’s approach is clearly one of the greatest abuses of the legal system ever.”

Judge Kaplan has made numerous rulings and comments that will likely come under additional scrutiny when oral arguments on the mandamus petition take place in front of the Second Circuit Court of Appeals on Sept. 26th.

Already, Chevron has displayed some jitters as the the company's retaliatory lawsuit approaches a trial date. As reported here last week:

In an otherwise routine scheduling conference recently before Judge Lewis A. Kaplan, Gibson Dunn lawyer Randy Mastro suggested the oil giant was prepared to drop all damages claims against the Ecuadorians and their counsel, Steven Donziger, just to avoid a jury trial.

Chevron was hoping that it could get a fraud finding from Judge Kaplan without having a new round of evidence of the company's abuses put under a spotlight before a jury and the public. But with Judge Kaplan under scrutiny himself, he doesn't look inclined to go that route.

It would seem that Judge Kaplan has been one of Chevron's best assets in the company's cynical efforts to evade responsibilty for its disaster in Ecuador.  Should the Appeals Court re-assign him, it would be a huge blow to those efforts.

Stay tuned.

And as always: for background on how Chevron decimated indigenous and farmer communities by dumping billions of gallons of toxic waste in Ecuador’s Amazon, watch this video overview or this 60 Minutes segment, or review this summary of the overwhelming evidence against the company.  Chevron is now fighting a $19 billion judgment against the company.

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.

Visit and watch a video on ChevronToxico.com to find out more.

Support Amazon Watch and Rainforest Action Network.

Read More

Chevron: The NSA of the Corporate World?

For anyone interested in how our national surveillance state and leading U.S. corporations work in lockstep, look no further than what Chevron is doing to spy on the critics of its environmental atrocities and human rights violations in Ecuador.

Yesterday, a Magistrate Judge in San Francisco granted oil giant Chevron access to many years of private email account information from nearly 40 email accounts belonging to human rights and environmental activists, lawyers, and their allies. All have some connection to the people who have held Chevron accountable in the Ecuador litigation. However, sometimes the connection is tenuous at best, as in the case of Australian law professor and journalist Kevin Jon Heller, who blasted Chevron and its lawyers at Gibson Dunn & Crutcher on high profile legal blog Opinio Juris.

While quashing subpoenas for some of the accounts Chevron sought, U.S. Magistrate Judge Nathanael Cousins of the Northern District of California ordered Google and Yahoo! to turn over years of private email account information from dozens of other Yahoo! and Gmail accounts to Chevron. This follows last month's order from Judge Lewis A. Kaplan of the Southern District of New York, who ordered Microsoft to turn over private email information from an additional 30 Hotmail accounts.

So if you've already been worrying about who may be snooping on you, add Chevron Corporation to the list.

Chevron has a long history of trying to suppress the First Amendment rights of its critics. CEO John Watson lost his cool and had five such critics arrested at a Chevron shareholder meeting in 2010.  The environmental and human rights group Amazon Watch has been repeatedly harassed and subpoenaed by the company for exercising its constitutional right to call it out publicly for its abuses in Ecuador, but has managed to fight off the oil giant's bullying efforts to access troves of internal documents and communications.

Over the years, Watson and his CEO predecessor David O’Reilly have even repeatedly turned off the microphones of Ecuadorians indigenous leaders and farmers who have come to speak to them at shareholder meetings.

Even if Chevron isn't sweeping up data randomly from millions of people like the NSA, it is indisputable that it is using its vast oil riches to spy on and demand email data from its critics. But if you support the communities in Ecuador who have fought for decades to hold Chevron accountable for its widespread environmental devastation and human rights abuses, you may find yourself on the wrong side of a subpoena.

As Marcia Hofmann of the Electronic Frontier Foundation (EFF) said recently:

"Environmental advocates have the right to speak anonymously and travel without their every move and association being exposed to Chevron. These sweeping subpoenas create a chilling effect among those who have spoken out against the oil giant's activities in Ecuador."

The Electronic Frontier Foundation (EFF) and EarthRights International (ERI) provided legal assistance to third parties affected by the Chevron litigation. You can read their motions to quash the subpoenas in the Northern District of California here, and in the Northern District of New York here.

Incredibly, Judge Lewis A. Kaplan, who is presiding over and doing his best to promote the retaliatory RICO lawsuit Chevron is pursuing against lead U.S. attorney Steven Donziger and some of the "named plaintiffs" in the lawsuit against Chevron that resulted in a $19 billion judgment against the company, managed to find a way to sit by "special designation" to decide on the enforceability of the Microsoft subpoenas. Donziger and the "named plaintiffs" in the litigation against Chevron have filed a petition with the Second Circuit Court of Appeals to have Judge Kaplan removed from the case for bias. In an extraordinary move, the appellate court has set oral argument on the issue for September 26th. If Kaplan gets tossed, Chevron’s strategy would suffer a devastating setback.

As a previous post here at The Chevron Pit notes:

The Second Circuit invited Kaplan to defend himself in light of a petition filed by the Ecuadorians and one of their lawyers, New York attorney Steven Donziger, seeking his reassignment. While most such requests are quickly dismissed, there clearly is something about Judge Kaplan’s behavior that is catching the Second Circuit’s attention.

But while in its fight to evade accountability for its devastation in Ecuador, Chevron may have found a tremendous ally in Judge Kaplan, the lengths to which the oil giant has shown it will go to evade justice is what's truly frightening.

Besides 2,000 legal personnel from 60 law firms, Chevron's efforts to evade justice have been aided by 180 investigators from Kroll, a large global private investigation firm which operates as a sort of private KGB spy service for its corporate clients. Kroll's shady services for Chevron first came to light when a journalist detailed the firm's attempts to bribe her to spy on Chevron critics in Ecuador. 

And the reality is that we don’t really know what Chevron is doing behind the scenes. Kroll has admitted compiling “20 to 30” reports on Donziger, who along with his family has been followed around Manhattan and put under surveillance by unknown plainclothes operatives.

But now, with its mind-boggling resources and boundless cynicism, the oil behemoth has managed to convince judges in the U.S. to allow the company to go ahead and spy on Chevron critics itself, with the court's blessing.

Critics of the NSA's spying program have pointed out the slippery slope we've been sliding down when it comes to protecting free speech, privacy, and the rights guaranteed by the Constitution in this country.

Chevron gaining access to its critics' private email account information opens up a whole new slope, and it is slippery indeed... oil-slick slippery. Will Big Oil want your info? Or another company you've protested over its dastardly deeds? What will they go after next?

Or whom?

For background on how Chevron decimated indigenous and farmer communities by dumping billions of gallons of toxic waste in Ecuador’s  Amazon, watch this video overview or this 60 Minutes segment, or review this summary of the overwhelming evidence against the company.  Chevron is now fighting a $19 billion judgment against the company.

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.

Visit and watch a video on ChevronToxico.com to find out more.

Support Amazon Watch and Rainforest Action Network.

Read More

Chevron Getting the Jitters Over Its RICO Case

Shaky Evidence and Appellate Court Scrutiny Starting to Disrupt Company’s Master Plan

Chevron’s vaunted 114-lawyer “rescue team” at Gibson Dunn seems to be getting the jitters over its upcoming RICO trial in federal court in New York.   

In an otherwise routine scheduling conference recently before Judge Lewis A. Kaplan, Gibson Dunn lawyer Randy Mastro suggested the oil giant was prepared to drop all damages claims against the Ecuadorians and their counsel, Steven Donziger, just to avoid a jury trial.   The company’s “Plan B” appears to be to seek a fraud finding from Judge Kaplan alone -- something the judge does not seem inclined to do, and something that would have little chance of working even if he did.

The fact Chevron is even thinking of this possibility is a huge retreat.  It’s also a strong indication that Chevron believes its billion-dollar investment in the RICO case has suddenly become a high-stakes gamble with far greater risk than CEO John Watson is letting on to shareholders and the financial markets.   A loss in the case via a jury verdict would be disastrous for the company both in the U.S. and in defending enforcement actions targeting its assets in countries around the world. 

If it were to drop the damages claims, Chevron might avoid a civil jury trial which in most cases is only guaranteed to a defendant when money is at stake.  But if Chevron chooses to go down this path, it will be left with virtually nothing to litigate.  It might get a “finding” from the discredited Judge Kaplan, but that will be of little or no use in foreign courts who already see the judge as a vassal of U.S. judicial arrogance.

To be clear: Chevron never thought the RICO case would get this far.  Juries are inherently unpredictable.  For a large corporation like Chevron with a $19 billion liability and the reputations of its senior management team at stake, that’s also terrifying.  Chevron simply cannot afford to lose this case.

Chevron assumed that the small legal team for the Ecuadorians would be ground to a pulp by now.  Or that Judge Kaplan would have found a way to rule in Chevron’s favor on pre-trial motions.  Both strategies have failed.

After being unanimously reversed in 2012 when he tried to block the Ecuador judgment from being enforced anywhere in the world, Judge Kaplan appears anxious to push Chevron’s allegations into the hands of a jury.  (That will come after the judge continues to make evidentiary decisions to rig the trial in Chevron’s favor.  See here and here for a taste of Kaplan’s bias.)  In the end of the day, Judge Kaplan knows any finding he makes alone has little chance of surviving appeal and his own instincts at this point are to protect himself, even if it means Chevron cannot get everything it wants.

Chevron also knows juries tend to follow their gut.  That does not bode well for Chevron’s absurd notion that it is the victim of a global  “racketeering scheme” foisted on it by the very indigenous groups who have had their ancestral lands poisoned by the company’s toxic dumping. This “blame the victim” approach is classic historical revisionism practiced the world over by oppressors and Chevron is no different.  

(For an understanding of the overwhelming evidence against Chevron in Ecuador, see this video, this 60 Minutes segment, and this summary of the evidence relied on by the Ecuador court to find the company liable for both polluting the delicate rainforest ecosystem and for trying to corrupt the trial that held it accountable.)

In 2011, the Second Circuit Court of Appeals reversed Judge Kaplan’s illegal injunction purporting to block worldwide enforcement of the Ecuador judgment. Judge Kaplan’s ham-fisted attempt to rescue Chevron from its misdeeds in Ecuador remains a sad example of ugly Americanism at its worst.  See here, and here to get a feel for the international scorn provoked by this short-lived attempt by a U.S. trial judge to control the Ecuador judgment on a global basis.  

Despite this personal setback – no Judge likes to get reversed -- Kaplan does not appear to be the least bit chastened from the experience.  And that’s bad for Chevron because Judge Kaplan’s hubris has put him in serious trouble yet again.

Just last week, the appellate court set oral argument in late September to determine whether Judge Kaplan should be removed from the RICO case altogether given his continued defiance of the Second Circuit’s order that he not opine on the validity of the Ecuador judgment.   See here for the latest facts underlying the petition for his removal.  Let’s just say it is serious business whenever a trial court thumbs its nose at an appellate court.  To do it on multiple occasions and blatantly is even more perilous. 

Judge Kaplan encouraged Chevron to bring the RICO action in the first place.  Without his efforts, it likely never would have gotten past first base.  The judge has jerry-rigged the evidence by repeatedly violating the due process rights of the Ecuadorians and Donziger.  He even has ruled they will not be allowed to present testimony about Chevron’s massive pollution in Ecuador, thus making it virtually impossible to mount a meaningful defense.  Should the case be reassigned to a fair judge, look for Chevron’s claims to lose all traction. 

As for the lawyers, Mr. Donziger and others are still confident.  It was Donziger who recently forced Chevron CEO Watson to testify about Ecuador during a deposition – a shocking risk given that he now could be charged with perjury if it is found that he lied under oath. This industry royal was forced to endure the humiliation of answering live questions posed by a solo practitioner (Donziger) he previously called a “criminal” on earnings calls with investors.  (Chevron has gone to great lengths to keep Watson’s testimony confidential.  When the lies and memory lapses get exposed, Watson will be further embarrassed and the global shareholder campaign against him will pick up even more steam.)

Given these problems, it is understandable why Mastro is nervous about a jury trial.  But there are other reasons.

First, Mastro is known far more as a political fixer than a trial lawyer.  He will fight like a pit bull to avoid ceding the high-profile trial stage to the many more talented lawyers at Gibson Dunn, including his colleagues Theodore Boutrous and former star federal prosecutor Reed Brodsky. Any defendant would want Mastro to lead the Chevron show before a jury.  Let’s hope he hangs in there.

We have seen from previous hearings before Judge Kaplan how Mastro and his sidekick, Andrea Neumann, lack basic courtroom agility and have an off-putting personal style.    Mastro already lost three key appellate arguments in the case and literally was laughed out of court in 2011 when he couldn’t answer the most basic questions when trying to defend Judge Kaplan’s illegal injunction before a three-judge appellate panel.  

Second, Chevron’s witness list reads like a Who’s Who of small-time thugs, criminals, and cartoon characters.  Almost all have agreed to testify because of some combination of bribes or intimidation coming from Chevron headquarters.  While the oil goliath has packaged this testimony for maximum effect in affidavits clearly ghostwritten by its own lawyers (leading to a lot of slanted reporting in its favor), under the klieg lights of trial it is doubtful that any of these people will retain even the slightest veneer of credibility.

Exhibit A is former Ecuador Judge Alberto Guerra Bastides, an admitted con artist who received a suitcase full of cash from Chevron lawyer Andres Rivero in Quito in exchange for favorable testimony.   In a deal negotiated directly by Mastro, Chevron has committed to paying Guerra at least $326,000 or roughly ten times his annual salary.  These payments are a clear violation of the ethical rules.  Given his many credibility problems, it is unclear if Guerra will even take the stand.  If he does, he will help the Ecuadorians more than Chevron.

Exhibit B is Christopher Bogart, the disgraced CEO of the litigation hedge fund Burford Capital.  Bogart helped to fund the legal battle of the Ecuadorian communities until Chevron threatened to add Burford as a RICO defendant.  In a panicked response, Bogart betrayed his clients and engaged in some cowardly double-dealing with Chevron – privately negotiating an exit from the case with Chevron’s lawyers while supporting the Ecuadorian communities publicly.   Bogart even emailed Mastro after the Chevron RICO filing and just weeks after he funded the Ecuadorians:  “Randy – congratulations on a superbly executed campaign!” 

Bogart eventually signed an affidavit to help Chevron where he clearly lied to the court about being “misled” by the Patton Boggs law firm and Donziger (Bogart’s own emails, which are nauseating to read, showed he actually believed the opposite).  See this devastating take-down of Bogart in a court brief filed by Patton Boggs as it seeks to strike his affidavit and impose sanctions against Chevron. It is unclear to us after reading this brief how Bogart will ever again work in the funding business.

(If any investor out there is thinking about Burford as an opportunity, they should read about the lack of ethics displayed by Bogart and another Burford director, Ernest J. Getto.  Since Bogart cannot be trusted to disclose this document – it is nowhere to be found on Burford’s website -- we have decided to post it here.)

Chevron’s other main witnesses have been similarly discredited.  It is now clear that Chevron threatened Douglas Beltman and Ann Maest – former scientific consultants to the Ecuadorians -- with personal bankruptcy and career destruction before they signed affidavits that contradicted prior sworn statements under oath attesting to the company’s responsibility for massive pollution in Ecuador.  [http://thechevronpit.blogspot.ca/2013/04/the-truth-behind-stratus-affidavits.html]   Beltman and Maest, who since have been fired from their jobs, will have little credibility if they take the stand and try to help Chevron. Expect lawyers for the rainforest communities to call these Chevron witnesses as their own if Mastro gets cold feet.

Chevron’s internal documents suggest the company is hanging itself by its own petard.  When faced with overwhelming scientific evidence of its guilt in Ecuador, Chevron decided to launch a strategy to “demonize” Donziger to distract attention from its own environmental crimes and fraudulent remediation.  This included using six Kroll operatives to spy on Donziger and his family in Manhattan.  How will a jury view a big oil company that tries to cover up its atrocities by demonizing a human rights lawyer who helped hold it accountable?

Chevron also launched a campaign to attack the government of Ecuador and to declare war on its courts even though Chevron fought for years to venue the case there.  A memo by Chevron consultant Sam Singer suggests the company adopt “message themes” that would portray Ecuador as “the next major threat to America” and “as the next Cuban missile crisis in the making.”    This type of overreach actually reflects Chevron’s level of desperation.  The company’s incessant attacks against Ecuador’s popular President, Rafael Correa, have started to alienate almost every oil-producing nation in South America and put the company’s business operations at further risk.

The Singer memo will not sit well with a New York jury either.  Nor will other internal documents that show Chevron tried to bribe judges, pay off Ecuador’s government to illegally quash the case, or ask its employees to engage in obstruction of justice by destroying damning documents about its many oil spills in the Amazon. 

Chevron’s entire strategy with the RICO case has been to obtain a huge judgment that it can then use to offset the enforcement actions (currently pending in Canada, Brazil, and Argentina) where the rainforest communities are targeting company assets.  Chevron has sued Donziger and his clients for upwards of $60 billion, thought to be the largest potential personal liability in U.S. history.  Giving up on that cannot be an easy decision.

Chevron is now caught in a maze of its own creation.   Here is Chevron’s dilemma.  If it takes the case to trial before a jury, the entire house of cards is at risk of falling down.  If it drops the damages claims to avoid a jury, any decision by Judge Kaplan will have little or no impact.   And the court of appeals is watching so closely that Chevron simply cannot expect Kaplan to run roughshod over the Ecuadorians and Donziger as before, even if he is allowed to stay on.

After billing Chevron outrageous sums and making grandiose promises to the world, the pressure is now all on Gibson Dunn.  The firm’s lawyers know a jury is risky business for a major client like Chevron with a proven record of human rights abuses and other corrupt activities in Ecuador. See this gripping photo essay from journalist Lou Dematteis for a sense of the profound human devastation Chevron has caused and that Gibson Dunn with Judge Kaplan’s help is trying to bury.

It would be a personal and professional disaster for Mastro and Chevron General Counsel R. Hewitt Pate to fail to deliver a verdict in the company’s favor.  Watch for more furious maneuvering by Chevron as the October trial date nears.  

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.

Visit and watch a video on ChevronToxico.com to find out more.

Support Amazon Watch and Rainforest Action Network.

Read More

Chevron Knows No Bounds In Ecuador Case, New York Times Article Shows

In a blog on The Huffington Post, the former U.S. spokesperson for the Ecuadorians who won a $19 billion judgment against Chevron for oil contamination argues a recent  New York Times article clearly shows that Chevron knows no bounds in its legal attacks to avoid being held accountable for the destruction it caused in the Ecuadorian rainforest.

Read the blog, written by Karen Hinton, here.

The New York Times article, written by energy reporter Cliff Krauss, is a balanced look at the 20-year-old lawsuit, but neglects to point out some key facts about the case:

1 -- Most importantly, it incorrectly states that the Ecuadorians filed their lawsuit against Texaco, now owned by Chevron, after Texaco entered into a remediation agreement with the Government of Ecuador. They filed their lawsuit in 1993 in a U.S. court. Not long after, Texaco appealed, lobbied, and probably bribed Ecuador's government to get the lawsuit dismissed. It would not and that led to the 1995 remediation agreement, which the U.S. court ignored. Equally important is the fact that the agreement carved out the Ecuadorians' lawsuit, stating that the third-party complaints were not covered by the agreement.

2 -- Chevron has never denied that it has spied and possibly continues to spy on one of the Ecuadorians' attorneys, Steven Donziger, a human rights lawyer whose reputation Chevron is clearly trying to destroy, if not his entire ability to make a living to support his family.

3 -- Chevron charges that the Ecuadorians' lawyers "ghostwrote" an Ecuador court report and two judgments, but have any reporters taken a close look at U.S. Judge Lewis Kaplan's recent rulings on Chevron's fraud countersuit? Kaplan's rulings are only slight re-writes of legal briefs filed by Chevron lawyers. U.S. judges often take arguments written in briefs, submitted by one side or the other, and use them in their briefs. In Ecuador, it's no different.

4 -- Krauss quotes Chevron saying that Donziger's "confidents" have turned against him, but everyone involved in the case knows that the individuals in question have been threatened and pressured by Chevron. For more than four years, Chevron pressured clients of Stratus Consulting, the environmental engineering firm for the Ecuadorians, to dump the firm. On the verge of bankruptcy resulting from the Chevron litigation against it, Stratus succumbed to the pressure with an affidavit disavowing the process for writing one of the court reports on contamination at the Chevron oil sites. Chevron dropped its lawsuit against Stratus; however, Stratus continues to stand by its findings of contamination. See here and here.

5 -- Another of Stratus' environmentalists is quoted from a video, saying that the contamination had not spread beyond the oil sites. Had Chevron allowed the reporter to see the entire video, he would have seen that she was concerned about the number of tests taken so far and was arguing for more testing to determine the impact of the contamination beyond the pits. Donziger was arguing that the Ecuadorians only had so much money to spend on tests; that contamination was evident at the oil sites, and that was enough to prove Chevron's guilt. Regardless, there is contamination at the well sites; people live near them; they should be cleaned.

Become a follower of  The Chevron Pit.
Follow us on Twitter at @ChevronPit and like us on Facebook.

Visit and watch a video on ChevronToxico.com to find out more.

Support Amazon Watch and Rainforest Action Network.

Read More