Ecuadorean Villagers Are Beating Chevron in a David vs Goliath Fight


Maria Aguinda, of the Kichwa indigenous group, with her family on an oil-soaked road in the family’s village of Rumipamba in 1993. Aguinda is the lead plaintiff in a class action lawsuit against Chevron (formerly Texaco) seeking clean up of petroleum contamination in the Amazon rainforest of Ecuador. Photo by Lou Dematteis

Most people have heard something about the class-action saga pitting the oil giant Chevron against a group of indigenous Ecuadorean villagers. In 2013, the indigenous people won a historic $9.5 billion judgment, upheld by the Supreme Court of Ecuador, in recompense for decades of wanton pollution.

That penalty — to be used for the remediation of waters, soils, and the health of the population of northeast Ecuador — was never paid.

Photo: Lou Dematteis

As fewer people know, Chevron challenged the Ecuadorean judgment in a New York federal court, where an ideologically sympathetic judge ruled it invalid in 2014. Based largely on the testimony of an Ecuadorean witness on Chevron’s payroll, Judge Lewis Kaplan declared the $9.5 billion judgment fraudulent under racketeering laws, and thus Chevron was under no obligation to honor it.

The judgment by a U.S. court did not end the Ecuadoreans’ pursuit of justice. Chevron is the world’s second-biggest oil company, with sprawling operations and subsidiaries in dozens of countries. Though it no longer has assets in Ecuador that can be seized to pay its fine, it has plenty of them over the border in Canada — an estimated $15 billion to $25 billion worth of assets, mostly tied up with that country’s tar sand fields.  

It is there, in the highest courts of Canada, that the Chevron saga is currently unfolding, most recently in a string of victories for the Ecuadorean plaintiffs.

In the latest of these victories, a three-judge Court of Appeal in Ontario ruled against Chevron in the company’s attempt to impose around $1 million in legal fees upon the Ecuadoreans plaintiffs. In their ruling, the judges noted

Chevron makes billions of dollars in annual revenue, and because of that, “It is difficult to accept that the motion … was anything more than a measure intended to bring an end to the litigation.”

It was not the first attempt to end the litigation by Chevron, whose officials have promised the Ecuadoreans a “lifetime of litigation.”

“Chevron’s entire strategy is based on obstruction and delay,” says Patricio Salazar, the plaintiffs’ lead Ecuadorian lawyer. “Canadian courts need to put an end to this abuse of the civil justice system. It is unfortunate that this Chevron maneuver to impose a court tax on the people it poisoned got as far as it did.”

In 2015, the company lost a case intended to shield its Canadian subsidiaries from enforcement action by claiming that Canada’s courts have no jurisdiction. The Canadian Supreme Court rejected the motion by unanimous decision. A similar suit by Chevron to shield its main Canadian subsidiary is still locked up in court, with a decision expected in the coming weeks.

Steven Donzier, talking to reporters. Photo: Lou Dematteis

Based on the strength of recent victories, the Ecuadoreans’ legal team feels optimistic that Canadian courts will soon be taking a hard look at the case to make Chevron pay for its poisonous legacy in northern Ecuador.

Steven Donziger, who has been leading the case for almost two decades, says it is increasingly likely that Chevron, and possibly Chevron Canada, will face trial in Toronto in 2018 or 2019.

“We’re confident Chevron’s scorched-earth strategy of obstruction and delay will soon run its course, and the company will pay the full amount necessary to clean up its awful pollution in Ecuador which continues to decimate indigenous peoples,” said Donziger. “Chevron has thrown at least $2 billion and 2,000 lawyers at [us] to try to obstruct court proceedings. That strategy has failed.”

As the case proceeds, its media profile in Canada is rising. Prominent Canadian lawyers have allied themselves with the Ecuadoreans, as has Phil Fontaine, the leader of Canada’s Assembly of First Nations. At a recent stadium concert in Vancouver, former Pink Floyd front-man Roger Waters educated the sold-out audience about the case.

Waters also attended the case’s most recent court proceedings in Toronto, where he told the Toronto Star, “It’s a fundamental question of whether corporations like Chevron . . . should be allowed to use their financial muscle to destroy people with [a] vital claim to reparations for damages that was caused to them over many years. The way Chevron has behaved is against everything that any of us might believe society ought to be like.”

There are signs that the events in Canada are being taken seriously within Chevron itself, where the board recently removed CEO John Watson. Donziger says sources tell him that a key factor in the decision was shareholder concern over his mishandling and enormous expense of the Ecuadorean case.

But as all sides know well, the case is bigger than just one company, and Chevron is fighting to stop a precedent that could have implications for every oil company polluting rainforests and rivers.

“This is one of the most successful corporate accountability cases of all time,” says Donziger. “It serves as a warning signal to the entire fossil fuel industry.”

 

 

Alexander Zaitchik

Alexander Zaitchik is a journalist based in New Orleans. His most recent book is The Gilded Rage: A Wild Ride Through Donald Trump’s America.

Ecuadorean Villagers Are Beating Chevron in a David vs Goliath Fight

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