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Ecuador vs. Chevron breaking news

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A court in Ecuador today persisted in an attempt to shake down the California-based Chevron corporation despite orders from American and international tribunals that would block any seizure of Chevron’s assets because of what multiple courts has said looks like “fraud” being perpetrated against the company.

The Ecuadoran judge awarded an $8 billion penalty against Chevron, supposedly for despoiling areas around drilling sites once operated by Texaco, which since has been bought by Chevron. Texaco handed the sites over to Ecuador’s state-run oil company PetroEcuador in 1992, and a previous Ecuadorean government gave the sites a clean bill of health in 1998 and released Texaco from all future obligations. The new, radically leftist government of President Rafael Correa, however, openly cheerleaded for the lawsuit, and pronounced that 1998 agreement effectively null and void.

For the past 18 months, however, Ecuador and the plaintiffs’ attorneys have suffered a string of embarrassments ranging from what looked like a bribery scheme involving a judge earlier assigned to the case, to falsified “expert” testimony, and to film outtakes showing the American plaintiffs’ attorneys engaged in what looked like a host of nefarious activities. At least four American courts involved in different aspects of the case used the word “fraud’ to describe those attorney’s activities, at least in terms of how those actions appeared at that stage of the proceedings.

On Feb. 8, U.S. District Judge Lewis Kaplan of New York issued an restraining order blocking the collection of any damages from Chevron. “I’m persuaded that the likelihood of irreparable injury [to bwe suffered by Chevron] is quite high,” he wrote.

The next day, notes a Chevron web site, fully accurately, “An international panel of arbitrators presiding in the Permanent Court of Arbitration in The Hague ordered the Republic of Ecuador to ‘take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment’ against Chevron in the Lago Agrio case pending further order or award from the international tribunal.”

Nevertheless, the Ecuadorean court issued its judgment today anyway.

Enforcement of the order, however, appears not to be likely anytime soon, based on the rulings from Judge Kaplan and from The Hague.

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About the Author
Quin Hillyer

Quin Hillyer

Quin Hillyer, a senior editorial writer for The Washington Times and a senior editor for the American Spectator magazine, has won awards for journalistic excellence at the local, state, regional and national levels. His work has been featured in more than 50 publications, including the Wall Street Journal, The Washington Post, the Houston Chronicle, the San Francisco Chronicle, Investor's Business ...

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