Chevron's false evidence used to fraudulently cover up its legal responsibility for a $12 billion pollution judgment in Ecuador has been put before the U.S. Supreme Court. This is a real test of the High Court's own ability to police lower court judges who get involved in judicial corruption.
The filing by Steven Donziger, the longtime U.S. lawyer for the affected rainforest communities, is the latest chapter in the campaign to hold the oil giant accountable for dumping billions of gallons of oil waste and causing a humanitarian crisis in the rainforest. Chevron lost the case in Ecuador, leading to a $12 billion judgment that is currently being enforced in Canada.
The company retaliated against Donziger and his clients by filing a civil "racketeering" (RICO) case in U.S. court before a judge who clearly was licking his chops to send a message to the courts of Ecuador and the rest of the developing world to keep their paws off a powerful U.S. oil company -- even if meant accepting distorted, untruthful, and corrupt evidence.
From a new press release on the filing:
Ecuadorian rainforest villagers and their longtime U.S. human rights lawyer have presented proof of Chevron's bribes, false evidence, and fraud to the U.S. Supreme Court as part of a petition to overturn an unprecedented RICO decision by controversial U.S. trial judge Lewis A. Kaplan.The petition to the U.S. Supreme Court points out that the RICO decision in favor of Chevron is the product of falsified evidence and judicial bias by the trial judge, the aforementioned Mr. Kaplan. After repeatedly signaling his support for Chevron, Kaplan refused to seat a jury and let Chevron drop all damages claims on the eve of trial to prevent a group of impartial fact finders from deciding the case.
Chevron's false evidence included testimony from an admittedly corrupt Ecuadorian witness, Alberto Guerra. Chevron paid Guerra a $2 million bribe, including $38,000 in cash out of a backpack, to become its homegrown patsy. At the time, he had been making $500 per month.
Chevron lawyers led by Randy Mastro then coached Guerra for 53 consecutive days before he took the stand in Kaplan's courtroom. "Money talks, but gold screams," Guerra told Chevron's lawyers when he negotiated his "fee" for testifying. Chevron also gave Guerra health care, a car, an immigration lawyer, and paid his taxes after he was moved to the U.S.
Needless to say, having enriched himself at Chevron's expense, Guerra had virtually no credibility when he took the stand in Kaplan's courtroom. What little he had disappeared completely when he blatantly lied under oath under the bright lights, as was evident to most observers.
Even though he was prepped meticulously by Chevron, Guerra could not keep his story straight. He claimed the villagers arranged for a bribe to the trial judge so they could write the judgment against Chevron. But that story fell apart when a forensic examination of the judge's office computer showed he wrote the judgment by saving it as a Word document at least 480 times in the weeks leading up to its issuance. Guerra had claimed it was given to the judge on a flash drive.
No corroborating evidence ever emerged that a bribe of the judge occurred.
Guerra also admitted to perjuring himself before Kaplan on several key points when he was cross-examined in a separate international arbitration proceeding after the end of the RICO trial. Yet Kaplan -- who repeatedly called the Ecuadorians the "so-called" plaintiffs and who made comments widely construed as racist -- credited Guerra in an obvious attempt to help rescue Chevron from the entirely appropriate liability imposed by Ecuador's courts. Here is a summary of the overwhelming evidence against Chevron in the Ecuador trial.
Given that BP has paid out about $50 billion for its Gulf of Mexico spill, Chevron actually got it off easy for its far worse contamination of the rainforest. The company abandoned roughly 1,000 open-air waste pits gouged out of the jungle floor which continue to contaminate soils and groundwater to this day. Most were built in the 1970s. Cancer rates in the affected area have skyrocketed.
Kaplan's mishandling of the case becomes even more outrageous when one considers it was Chevron that insisted the trial take place in Ecuador. In the 1990s, the company filed 14 affidavits in U.S. federal court praising Ecuador's judicial system. To help Chevron get out of the conundrum of having lost in the forum of its choosing, Kaplan determined that Ecuador's entire judicial system was incapable of producing fair verdicts even though Chevron had repeatedly lauded the country's courts.
It also turns out that Kaplan never revealed that during the RICO trial he held investments in Chevron. In an act utterly devoid of ethics, he never disclosed his financial connection to the company even though Donziger and his colleagues twice tried to remove him from the case for bias.
Kaplan also called the Ecuador litigation "mud wrestling" and said Donziger's goal was to use the case to "fix the balance of payments of deficit" of the United States. "I got it from the beginning," he said. And that was before he held as much as an evidentiary hearing.
Whether the U.S. Supreme Court will step in to police what can only be described as judicial corruption remains to be seen. But don't hold your breath. In recent years, our appellate courts shown little but hostility to foreign plaintiffs who come to our shores to hold American companies accountable for their misconduct abroad.
It is important to remember that Chevron's dirty work in manufacturing evidence for Kaplan was farmed out to the U.S. law firm Gibson Dunn & Crutcher in a practice group headed by the notorious Mastro, the former deputy to New York Mayor Rudy Guliani. Known for his divisive approach to politics, Mastro was largely hated in New York's black and Latino communities when he worked as a public official. It was Mastro who steered the case to Kaplan.
Donziger called Mastro "a corporate hit man of the worst order."
"My experience is that Mastro and his cohorts will do virtually anything, including paying witnesses massive sums of money, to help rescue clients in trouble if the fees are high enough and they believe the judge is friendly enough to protect them," Donziger said. Federal judges twice sanctioned Gibson Dunn for using the discovery process to harass the Ecuadorians. (See here for a history of the firm's many ethical problems.)
Called a "warhorse lawyer" by Rolling Stone magazine, Donziger said this in the press release:
It is our view that Kaplan and the Second Circuit owe the people of Ecuador an apology for refusing to consider evidence that blows up Chevron's false narrative. This is an ongoing stain on the American judiciary in the eyes of the world and it will not go away unless and until the Supreme Court acts.A larger issue is that Chevron created the RICO strategy as a playbook for polluting corporations to retaliate against human rights lawyers and their clients who hold them accountable. The playbook is designed to threaten advocates who dare challenge the false company narrative. It no doubt represents a grave threat to social justice advocacy. Retaliatory corporate lawsuits are an intimidation tool designed to drive away lawyers and leave human rights victims utterly defenseless.
Chevron even admitted in an email that its strategy was "to demonize Donziger" to distract attention from the fact is deliberately dumped oil waste into the rainforest, decimating indigenous groups and causing a humanitarian crisis that has killed or threatens to kill thousands.
Chevron has used at least 60 law firms and 2,000 lawyers, at a cost in excess of $2 billion, to try to run Donziger and his colleagues off the case. It has not worked. Since Chevron launched its attacks in 2009, the company has lost the underlying case in Ecuador; seen it affirmed unanimously by Ecuador's Supreme Court; and seen Canada's Supreme Court unanimously reject Chevron's attempt to block a seizure action against its assets in that country.
Chevron knows it is in serious trouble in the Ecuador matter. It's strategy is to keep kicking the can down the road, thinking it will be cheaper to pay up far in the future.
In the meantime, Donziger and his clients have attracted top legal talent to their cause -- including John Keker of Keker & Van Nest in San Francisco, Alan Lenczer of Lenczer Slaght in Toronto, and Sergio Bermudes who is one of the top litigators in Brazil. Many other law firms are helping as the villagers maintain enforcement actions against Chevron to force compliance with the judgment.
Chevron CEO John Watson and General Counsel R. Hewitt Pate, who make a combined $30 million annually while the average annual income of their victims is about $1,000, have very little to show for their jihad against the Ecuadorians. Their problem is that regardless of whether the U.S. Supreme Court decides to take the case, the horse has escaped the barn.
Having decided to litigate elsewhere, there is now nothing a U.S. court can do to rescue Chevron from its growing financial liability to the people of Ecuador. But there is much the High Court can do to restore our judiciary in the eyes of the world and protect the First Amendment rights of social justice advocates.
It can start by using the Chevron pollution case to sanction Kaplan for letting a major American oil company try to evade liability by corrupting our system of justice with lies, fraud, and bribes.