Thursday, February 17, 2011

Ecuador's Chevron Verdict

The case has been dragging on for 18 years. It looks to go on for some time longer as both sides in the case are dissatisfied with the $8.6billion in fines and costs for cleaning up thirty years of polluting the Ecuadorian rainforest. Chevron has vowed not to pay a dime, and has legally attacked the impartiality of Ecuador's legal system by filing a racketeering (RICO) case against the plaintiff's lead attorney.  The corporation claims the suit is a conspiracy to extort money from Chevron. It has sought injunctive relief against enforcement of any verdict against it in both  US and international courts, part of a wider strategy to turn US courts and public opinion against its native adversaries. The plaintiffs, a group of indigenous Ecuadorians, say the verdict is too small and also plan to appeal the judgment. As they astutely put it, "our pachamama [Mother Earth] is dead" They claim damages of $113 billion in their suit originally filed in 1993. But the case begins in 1964. Texaco, later bought by Chevron, entered into a partnership with the state oil company, Petroecuador, to extract oil from the remote Oriente region. During thirty years of exploration as sort of "droit de seigneur" controlled operations as billions of gallons of waste oil and water were dumped into open pits, fouling the land and killing wildlife and livestock. The pollution was so severe that court appointed experts have estimated the pollution has killed 1,400 people. When Texaco withdrew from Ecuador, it agreed to pay $40 million to repair some of the damage.

The current suit began in New York when 47 residents of the affected area sued Texaco. In 2003 the New York court ordered the case should be heard in Ecuador. Eight years later a verdict was reached. The judgment allots $5.4 billion for soil restoration, $2.2billion for public health care, $600million for decontamination of water sources, and some more for wildlife restoration. The court also ordered $900 million in reparations to the plaintiffs. The verdict from Judge Nicolas Zambrano of the Sucumbios Provincial Court is the largest ever awarded in an environmental lawsuit anywhere in the world. But according to the people who live with the aftermath more is needed to repair the damage done to Mother Earth. For Chevron, which has no longer has assets in Ecuador and blames most of the mess on Petroecuador [photo], the price of continuing to litigate in several international venues is less than paying a verdict "that is unenforceable in any court that observes the rule of law".