Sept. 9 (Bloomberg) -- Chevron Corp., battling a $27 billion environmental lawsuit in Ecuador, said it may pay the legal bills of a U.S. businessman whose secret recordings of meetings with the judge on the case led the jurist to step down.

Californian Wayne Hansen used a pen equipped with a tiny camera to record meetings he had in May and June with Judge Juan Nunez in Ecuador, Chevron announced Aug. 31. Hansen told the judge he was seeking contracts for his company to clean up oil contamination if Nunez ruled Chevron was responsible for environmental damage in the Amazon Basin, according to Chevron’s translation of the conversations, which were in Spanish.

Chevron alleges that Nunez disclosed his intention to rule against the company at the meetings. Ecuador Prosecutor General Washington Pesantez said yesterday that the recordings, which Chevron provided to the government, show Nunez told Hansen that he would have to wait until Nunez issued a decision to find out the ruling. Pesantez said he’s investigating the matter.

If Hansen “incurs future legal costs related to this matter, it would only be fair that we consider assisting him,” Kent Robertson, a Chevron spokesman, said yesterday in an e- mailed statement.

Hansen has “no relationship” to Chevron, the company has said.

Laurie Levenson, a former federal prosecutor who teaches at Loyola Law School in Los Angeles, said secretly recording the meetings could be a criminal or civil violation. Companies often cover legal bills or provide attorneys for executives facing lawsuits connected to their duties, she said.

‘Good Samaritan’

“Either Chevron has turned into the biggest good Samaritan out there or they have allied interests with this man,” Levenson said in a telephone interview. “The ball’s in Chevron’s court to give a better explanation of whether they’ll pay his legal costs out of the goodness of their heart or as part of a contractual arrangement.”

Chevron paid for Ecuadorean contractor Diego Borja, who also attended and recorded the meetings with Hansen, to leave Ecuador and is providing him with financial support, Robertson said on Sept. 1, without disclosing specific amounts. The company had concerns for his safety in Ecuador, Robertson said.

Alleged Bribe

Chevron has declined to say where Borja is. He left Ecuador for the U.S. on June 24, according to migration police records in Quito. Borja and Hansen were asked to pay a $3 million bribe by a political operative in Ecuador’s ruling party to get pollution cleanup contracts, Chevron says the recordings show.

Hansen, an engineer, declined to comment and referred questions to San Francisco criminal defense attorney Mary McNamara, who confirmed that she’s representing him.

“This event has generated considerable interest,” McNamara said in a telephone interview. She declined to comment further.

Nunez, a former Ecuadorean Air Force officer and president of the Nueva Loja Superior Court in Ecuador’s northeastern Sucumbios province, had been overseeing a lawsuit filed by Amazon Basin residents who claim San Ramon, California-based Chevron is responsible for toxic waste from oil drilling in the jungle from 1964 to 1990 or later.

Texaco Drilling

The plaintiffs claim the pollution was left by Texaco Inc., which Chevron acquired in 2001. The case began in 1993 in New York and now is being handled in a court in Lago Agrio, a town 20 miles south of the Colombian border near the former Texaco oil fields.

The potential damages in the case may total as much as $27 billion, according to a court-ordered report in the case.

The Amazon Basin, extending from Brazil to Peru and Ecuador, has sparked environmental discord for decades as ecologically sensitive tropical rain forest was destroyed to extend pasture for cattle and to build roads and pipelines. Companies have been accused of oil spills spoiling delicate lands and waterways while slash-and-burn removal of tropical trees by soybean farmers and ranchers have sometimes provoked deadly confrontations.

Liability Claim

Chevron has said Texaco cleaned up its share of any lingering spills in exchange for a release from future liability before state-owned PetroEcuador took control of the operations almost two decades ago. PetroEcuador continued to release wastewater into the environment from 1990 until 2007, company spokesman Fausto Meja said last year.

Nunez agreed to step down from the case on Sept. 4. He had been expected to issue a decision as early as November. Nunez hasn’t returned phone calls seeking comment.

The case now goes to a new judge in Lago Agrio. In the country’s legal system, civil cases are decided by judges who gather evidence from witnesses, documents and experts before reaching a decision.

To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net.

Last Updated: September 10, 2009 11:59 EDT