Law Scholars From 11 Countries Urge Reversal of Chevron RICO Decision, Saying Judge Kaplan Violated International Law

  Law Scholars From 11 Countries Urge Reversal of Chevron RICO Decision,
  Saying Judge Kaplan Violated International Law

Support for Villagers Increasing as Human Rights and Environmental Groups Also
Urge Reversal of Controversial Decision

Business Wire

NEW YORK -- July 11, 2014

Thirty-six international law scholars from 11 countries have joined numerous
civil society organizations and the government of Ecuador in asking a New York
appeals court to overturn what they call a second unlawful attempt by federal
trial judge Lewis A. Kaplan to “dictate” to the world’s courts that they
should block enforcement of the $9.5 billion Ecuador environmental judgment
against Chevron.

The "friend of the court" brief filed by the international law scholars
follows the brief filed by the Ecuadorian villagers and the brief by U.S.
lawyer Steven Donziger, all urging reversal of Kaplan’s controversial ruling
in a bench trial that the Ecuador judgment was a product of fraud even though
two appellate courts in the South American nation (including Ecuador’s Supreme
Court) unanimously affirmed the trial court judgment. The 70-page fact section
of Donziger’s brief illustrates in detail Kaplan’s bias in favor of Chevron
and the numerous flaws in his proceeding, which the affected villagers have
called an illegitimate “show trial” designed to help Chevron block
international enforcement of the Ecuador judgment in the very forum the
company had insisted the trial be held.

The entrance of the law scholars and other prominent groups into the case
illustrates that Donziger and his clients are not alone in their view of Judge
Kaplan and have garnered increasing support worldwide for their 20-year effort
to force Chevron to clean-up its widespread contamination in Ecuador’s
rainforest, where the company operated from 1964 to 1992 under the Texaco
brand. In finding Chevron liable, Ecuador’s courts relied on thousands of
pages of scientific evidence that demonstrates the company gouged hundreds of
open-air toxic waste pits out of the jungle floor and discharged at least 15
billion gallons of oil-laced production waters into rivers and streams relied
on by the local population for drinking water, bathing, and fishing.

The 36 law scholars – who hail from Australia, Israel, Austria, the U.S.,
Kenya Finland, Turkey, Spain, Greece, and Iceland -- are among several
interested parties who filed “friend of the court” briefs this week urging the
Second Circuit Court of Appeals to reverse Kaplan’s decision, which was issued
in March after a trial that involved corrupt testimony, astronomical payments
by Chevron to fact witnesses, and where the court refused to even admit the
188-page Ecuador court decision into evidence.See here.

Others who filed briefs urging a reversal of Kaplan’s decision include 17
U.S.-based civil society organizations, among them Amnesty International,
Amazon Watch, Rainforest Action Network, and Friends of the Earth; the
government of Ecuador, which blasted Kaplan for claiming the country’s entire
judiciary fails to meet international standards based largely on the testimony
of an avowed political opponent of the current government; and Earth Rights
International, considered one of the leading environmental law and human
rights organizations in the country.

The international law scholars characterized Judge Kaplan’s decision to impose
a constructive trust that purports to divert to Chevron any monies collected
by the rainforest communities on their own judgment as an “affront” to all
foreign courts and “an exercise in futility” that can never be enforced. The
professors also assert that Kaplan’s order “breaches” the legal obligation of
the U.S. government “not to intervene” in the domestic affairs of other
sovereigns, and usurps the authority of judges around the world to apply their
own domestic laws to any request by the villagers that the Ecuador judgment be
enforced. (Such enforcement actions are currently pending against Chevron in
Canada, Brazil, and Argentina.)

The international law scholars maintain that Judge Kaplan’s decision also
violates U.S. law given that in 2011 the New York appellate court reversed the
judge after he imposed – without holding an evidentiary hearing -- an
unprecedented preliminary injunction that purported to block every foreign
court in the world from enforcing the Ecuador judgment. Setting up the
constructive trust to divert funds from the villagers to Chevron, the scholars
argue, simply repeats the same mistake and is clearly prohibited by
international law and the prior U.S. appellate decision in a case known as
Chevron v. Naranjo.

“As with the preliminary injunction, the District Court prejudges the case
again for the world,” said the brief of the law scholars. “This time, however,
the District Court attempts to impose its own terms of exclusive relief in the
form of a constructive trust on every other court in the world.

“As in the last appeal, the District Court again positions itself as an
exclusive transnational arbiter,” the brief added. “It seeks to dictate to the
courts of the entire world what will happen if they recognize and enforce the
Ecuadorian judgment.”

The scholars also accused Kaplan of engaging in “smoke and mirrors” by trying
to give a nod to international law by claiming the Ecuadorians are free to
enforce their judgment. In practice, the scholars argue, Kaplan’s unlawful
constructive trust remedy is “waiting in the wings” to undermine any such
efforts in practice.

The brief filed by the 17 civil society groups asks the Court of Appeals to
reverse Judge Kaplan for unlawfully using the RICO statute to violate the
First Amendment rights of advocates. As part of his ruling, Judge Kaplan found
that organizing protests and distributing press releases by civil society
groups in loose coordination with the villagers was part of an illegal
“extortion” attempt against Chevron. The submission of the civil society brief
follows the release of a letter to Chevron signed by 43 civil society groups
that blasts the company for trying to use the RICO statute to intimidate and
silence its critics.

Characterizing Chevron’s case as little more than a SLAPP campaign designed to
silence the many critics of the company in the environmental and human rights
communities, the brief argues that Judge Kaplan’s ruling poses a “severe
threat” to the groups’ “exercise of their First Amendment rights.” Such rights
“will be severely chilled by the very real possibility that [the civil society
groups] will have to mount costly defenses to retaliatory litigation brought
by deep-pocketed corporate defendants,” argued the brief.

“In essence,” the brief argued, “this case is an effort by Chevron to
retaliate against Ecuadorian villagers, their lawyers, and their supporters
for suing, bringing public pressure, and petitioning government agencies to
hold Chevron accountable for violations of human rights.”

In its brief the government of Ecuador accused Judge Kaplan of “reaching far
beyond the issues presented” to “impugn” the integrity of Ecuador’s government
and entire judiciary. “Like virtually all Latin American countries, the
Republic has undertaken nearly two decades of aggressive legal reforms to
modernize its courts and increase the quality, independence, and transparency
of its judicial system,” the brief argued, pointing out that Chevron
repeatedly praised Ecuador’s judicial system when it sought to move the case
out of U.S. courts, where it was originally filed in 1993.

“The Republic has a strong, legitimate interest in ensuring that its judiciary
– which Chevron long championed as a preferable forum to a U.S. court – is
afforded the same respect any State, including the United States, would expect
from a sister sovereign,” the brief added.


After an eight-year trial, Chevron in 2011 was found liable in Ecuador after
it admitted to deliberately dumping billions of gallons of toxic waste and
building and abandoning hundreds of unlined oil waste pits, leading to
extensive contamination and the decimation of indigenous groups and other
communities in the area. The litigation took place in Ecuador after Chevron
insisted that it be transferred there from U.S. courts, promising to accept
jurisdiction and pay any adverse judgment.For background on the overwhelming
evidence against Chevron relied on by the Ecuador court, see this document;
this video; and this 60 Minutes segment.

In retaliation, Chevron in 2011 filed a racketeering case in U.S. courts
alleging that the Ecuador litigation was a “sham” and that the villagers and
their lawyers were trying to “extort” money from the company. Judge Kaplan
invited Chevron to file the case from the bench during a related discovery
matter, and then assigned it to himself. After a flawed trial that denied the
defendants a jury and disregarded all evidence of Chevron’s contamination,
Judge Kaplan ruled in the oil company’s favor and ordered that all proceeds
collected in foreign courts against Chevron be put in a constructive trust for
the benefit of the oil company.

In the meantime, the villagers have filed lawsuits in Canada, Brazil, and
Argentina to enforce their judgment and seize Chevron assets to pay for the
court-mandated clean-up.

For more information, to go or


for Donziger and Associates
Karen Hinton, 703-798-3109
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