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Lawyer appeals ruling that blocks U.S. collection of award in Chevron Ecuador case

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[March 19, 2014]  By Joseph Ax

NEW YORK (Reuters)  A U.S. lawyer on Tuesday appealed a federal judge's ruling that he used fraud to secure a multibillion-dollar pollution judgment against Chevron Corp in Ecuador, a decision that bars him from collecting a $9.5 billion award in the United States.

Lawyer Steven Donziger has also asked the judge, U.S. District Judge Lewis Kaplan, to put his ruling on hold while a federal appeals court considers the merits of Donziger's challenge, a process that will likely take months to resolve.

Kaplan issued a nearly 500-page decision earlier this month finding that Donziger had used "corrupt means," including bribery, in pursuit of an $18 billion judgment against Chevron in 2011 on behalf of a group of villagers who claimed the oil giant polluted an area of northeastern Ecuador.

Ecuador's high court cut the judgment in half to $9.5 billion last year.

The decision, which followed a six-week non-jury trial last fall in New York, bars Donziger and the villagers from seeking to collect on the judgment in the United States. Chevron has also said it will use the ruling as ammunition to fight attempts by the villagers to go after the company's assets in other countries.

In a court filing on Tuesday, Donziger's lawyer said Kaplan's ruling was unlikely to survive review from the 2nd U.S. Circuit Court of Appeals.


"This court's decision in this case is without precedent," Donziger's lawyer wrote in a court filing on Tuesday. "It seeks to preemptively undermine the judicial decree of a foreign sovereign nation and, in so doing, to let Chevron Corporation off the hook for decades of deliberate pollution in the Amazon rainforest."

If Kaplan denies the request for a stay, Donziger will seek one from the 2nd Circuit, according to the filing.

In a statement, a Chevron spokesman said Donziger should accept the court's ruling.

"This is yet another attempt by Steven Donziger to evade the court's well-supported findings and avoid taking responsibility for his actions," the spokesman, Morgan Crinklaw, said. "The court's nearly 500-page opinion and judgment capture in extraordinary detail the defendants' unlawful scheme."

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The case centers on an oil field at a site, known as Lago Agrio, where Texaco operated from 1964 to 1992. Chevron later acquired Texaco.

Chevron has asserted that Texaco cleaned up the site before handing it over to a state-controlled company.

In 2011, Ecuadorean Judge Nicolas Zambrano ruled in the villagers' favor. Chevron, claiming the judgment was a result of fraud, eventually filed a racketeering lawsuit against Donziger in New York that led to last year's trial.

In his opinion, Kaplan concluded that Donziger's team bribed a former judge to ghost-write the Ecuadorean judgment, among other improprieties.

Donziger has repeatedly accused Kaplan of bias and claimed the judge allowed personal animosity toward Donziger to affect his decision. He has denied the bribery and fraud allegations.

The case is Chevron Corp v. Steven Donziger et al, U.S. District Court for the Southern District of New York, No. 11-0691.

(Reporting by Joseph Ax; editing by Cynthia Osterman)

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