Wednesday, April 29, 2015

Fortune Focuses On Brad Pitt While Ignoring Key Developments In Ecuador Pollution Case

Reposted from The Chevron Pit

Roger Parloff's reporting for Fortune about Chevron's growing pollution liability in Ecuador – where he ignores devastating new evidence that the oil giant's defenses are unraveling – is on display yet again with a blog claiming that Brad Pitt has interest in making a movie about the litigation.

This is a great example of how a legal reporter misses the point. A good part of Chevron's Ecuador house is burning down, and Parloff focuses on the tricycle in the front yard.

Parloff's obvious sympathy for Chevron and his refusal to publish our letters calling him out for his errors has been well-documented on these pages and elsewhere, including in this post by activist-journalist Kevin Koenig of Amazon Watch. By consistently engaging in reportorial hijinks when covering the historic case, Parloff deprives Fortune's readers of critical information and undermines his credibility and that of his employer.

Parloff's latest post was about Pitt's supposed interest in a movie focused on Steven Donziger, the U.S. lawyer who helped hold Chevron accountable for dumping billions of gallons of oil waste into the rainforest. According to Parloff, Pitt beat out George Clooney for the rights to the story. Yet neither Pitt nor Clooney nor Donziger confirm any involvement.

While trying to write cute stories about movies, Parloff continues to ignore critical substantive developments in the case that contradict Chevron's narrative that the company has been victimized by the very rainforest communities it poisoned. In 2013, after 11 years of legal proceedings in Chevron's chosen forum, Ecuador's Supreme Court in a 220-page decision affirmed a trial court judgment finding that the company had deliberately dumped billions of gallons of toxic oil waste into rainforest waterways when it operated in Ecuador (under the Texaco brand) from 1964 to 1992.

Since Parloff last reported on the Ecuador pollution matter in depth, three critical facts have emerged that have seriously undermined – if not completely blown up – the contrary civil findings of U.S. Judge Lewis A. Kaplan in Chevron's retaliatory racketeering case. Neither Fortune nor Parloff have reported these developments even though they suggest nefarious efforts by Chevron's lawyers to frame Donziger as revenge for winning a historic $9.5 billion judgment against the company.

(Judge Kaplan's determination that a fraud occurred, which is under appeal, contradicts the findings of eight separate appellate judges in Ecuador that actually had access to the record evidence. Kaplan refused to admit any evidence of Chevron's pollution in Ecuador nor look at the Ecuador trial record. For background on how Chevron made a mockery of justice in Kaplan's courtroom, see here.)

The first critical fact ignored by Parloff is a new forensic examination of the computer of the Ecuador trial judge that emerged recently in a related investor arbitration between Chevron and Ecuador's government. That report – by one of the world's leading authorities on the subject, J. Christopher Racich – found that the trial court judgment against Chevron was written painstakingly by the judge over a period of months on his office computer.

Chevron had claimed Donziger had orchestrated the writing of the judgment and that it had been given to the judge on a flash drive just before it was issued. Donziger has categorically and repeatedly denied the allegation under oath and there is zero forensic evidence to support it. Let's just say the Racich report confirms Donziger is telling the truth, Chevron is lying, and Kaplan (who has undisclosed investments in Chevron) got it wrong.

Also ignored by Parloff is the related issue of how Chevron paid its star witness who testified falsely about the ghostwriting story, a crooked former Ecuadorian judge named Alberto Guerra, tens of thousands of dollars in cash out of suitcase and upwards of $2 million in benefits. You get the picture: Chevron purchased false witness testimony in violation of the ethical rules (read this affidavit by Dean Erwin Chemerinsky) and used it to frame adversary counsel. That might explain why Chevron lawyers coached Guerra for 53 consecutive days before putting him on the stand.

The Racich report and payments to Guerra not only eradicate the last remnants of Chevron's credibility in the company's New York case, they utterly destroy the key factual predicate of Judge Kaplan's deeply flawed decision against Donziger and his clients. Kaplan, who for years disparaged Donziger and the Ecuadorians from the bench, did not have access to the Racich report.

(For a summary of the Racich report, see this filing by Donziger attorney Deepak Gupta. While Fortune ignored the filing, Adam Klasfeld of Courthouse News did report extensively on the Racich conclusions.)

The second key development ignored by Parloff was the release in early April of explosive internal Chevron videotapes that expose an elaborate ruse by company scientists to defraud Ecuador's courts by only "finding" clean soil samples at clearly polluted sites during the eight-year trial. The videos, turned over to Amazon Watch by a Chevron whistleblower, were first published by Vice News and have been rampaging across the internet for the last several weeks. They also show Chevron scientists laughing at the pollution at well sites the company had previously certified as remediated.

Again, nothing from Parloff and institutional silence from Fortune.

Finally, in a devastating setback for Chevron, a panel of investor arbitrators sympathetic to the company recently nullified the oil giant's primary defense to the pollution allegations. Chevron had tried to claim that it was absolved of all liability for the pollution based on what turned out to be a sham remediation conducted in the 1990s; both the arbitrators and three layers of courts in Ecuador have now rejected the defense. For background on how Chevron General Counsel R. Hewitt Pate has misled shareholders on the issue, don't read Fortune because it's not there.

See our own blog posting of the panel's decision here or read the Courthouse News version here.

Instead of focusing on the emergence of new evidence, Parloff wrote a largely unsourced post about a possible movie in a clear attempt to pump up his friend Paul Barrett's pro-Chevron book on the litigation. Barrett's one-sided take has earned him a possible defamation lawsuit for distorting facts and fabricating scenes. It also has received poor reviews from the likes of prominent writer Peter Maas. (Donziger's "notice of defamation" letter to Barrett and his publisher can be read here.)

Barrett and Parloff have a mutual interest in stroking each other. In his own reporting for Businessweek, Barrett also has ignored the Racich report, the arbitration decision, and Chevron's videos. So did Michael Goldhaber of American Lawyer. Along with Parloff, Barrett and Goldhaber have a history of being wedded to Chevron's narrative and they often quote each other's articles. (Goldhaber had the audacity to write a short book about the case without even visiting Ecuador or interviewing any of Chevron's victims.)

Also ignored by Fortune is any serious examination of how Chevron's management team is in trouble after having invested an estimated $2 billion of company funds to hire 60 law firms and 2,000 legal personnel to try to beat back the communities and Donziger (described as a "warhorse lawyer" according to Rolling Stone). Many of Chevron's largest shareholders are seeking the scalp of Chevron CEO John Watson after he was reprimanded over his mishandling of the Ecuador matter during a recent annual meeting.

In his Hollywood blog, Parloff also writes that Donziger's attorneys "for the most part" have not disputed Judge Kaplan's findings that a bribe occurred in Ecuador. That's not true and proves how intellectually dishonest Parloff can be.

Donziger and his attorneys have disputed the bribe and just about every one of Kaplan's "findings" as is made clear by the first 70 pages of the lawyer's appellate brief. Parloff also ignores Donziger's comprehensive 5,000-word takedown of Chevron's environmental crimes and fraud in Ecuador in an article published recently by the legal media outlet Donziger has made it clear at every turn that there was no bribe and that it was Chevron that repeatedly tried to corrupt and sabotage the Ecuador trial, as this sworn affidavit (also ignored by Fortune and Parloff) explains in detail.

While Parloff ignores these new developments, they clearly have planted seeds of doubt about Kaplan's decision in a federal appellate panel that seems highly skeptical of Chevron's forum shopping and bad faith. For more on that, see this article by – you guessed it – a Fortune competitor.

There are many who pay the price for Fortune's apparent inability to report the Ecuador litigation in a balanced way – starting with the magazine's own readers. It shouldn't be hard for a magazine to present two points of view in a contested litigation. Fortune and Parloff need to step it up.

(Editor's Note: For a copy of our letter to Fortune submitted in 2013 criticizing Parloff for errors in a prior story about the Ecuador litigation, see here. Fortune still has refused to print the letter.)

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