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 U.S. District Judge Lewis Kaplan in New York said he found "clear
and convincing evidence" that attorney Steven Donziger's legal team
used bribery, fraud and extortion in pursuit of an $18 billion
judgment against the oil company issued in 2011.
The villagers had said Texaco, later acquired by Chevron,
contaminated an oil field in northeastern Ecuador between 1964 and
1992. Ecuador's high court cut the judgment to $9.5 billion last
year.
But regardless of whether there is pollution at the site, Kaplan
said, Donziger cannot use a "Robin Hood" defense to justify illegal
behavior.
Kaplan's decision bars Donziger and the villagers from enforcing the
Ecuadorean ruling in the United States. It may also give Chevron
legal ammunition in other countries where the plaintiffs could try
to go after Chevron's assets.
At a six-week trial last year, Chevron accused Donziger of fraud and
racketeering and said Texaco cleaned up the site, known as Lago
Agrio, before handing it over to a state-controlled entity.
Donziger, who has repeatedly leveled accusations of bias against
Kaplan and who predicted he would lose the case, called Tuesday's
decision "appalling" and blamed Kaplan's "implacable hostility"
toward him and his Ecuadorean clients.
"Through this decision, we now have the spectacle of a Manhattan
trial judge purporting to overrule Ecuador's Supreme Court on
questions of Ecuadorean law," he said in a written statement. He
vowed to appeal and said the ruling would not stop his clients from
seeking to enforce the judgment in other countries.
Chevron no longer has significant assets in Ecuador, and the
villagers have tried to enforce the ruling in Canada, Argentina and
Brazil.
Chevron Chief Executive John Watson said the ruling was "a
resounding victory."
The company is expected to use Kaplan's decision to defend itself
against claims abroad. In a statement, the company said, "Any court
that respects the rule of law will find the Lago Agrio judgment to
be illegitimate and unenforceable."
Chevron and Ecuador also remain locked in an arbitration dispute in
international court over cleanup costs at the site.
In Washington, the Ecuadorean embassy said in a statement that the
decision "does not exonerate Chevron from its own legal and moral
responsibilities resulting from its decades of contamination."
'VOLUMINOUS' EVIDENCE
The decision caps a years-long battle in U.S. courts between Chevron
and Donziger, pitting the company's vast resources against a lawyer
who argued he was the victim of an unscrupulous corporation.
But Kaplan found that the evidence against Donziger was
"voluminous," including things like coded emails, secret payments
and clandestine meetings with judges that "normally come only out of
Hollywood."
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Kaplan said Donziger began pursuing the case with intentions to
improve environmental conditions in Ecuador and make a living for
himself, but ultimately corrupted the case by submitting fraudulent
evidence, bribing a judge, ghost-writing the judgment and covering
up his wrongdoing.
"The saga of the Lago Agrio case is sad," Kaplan wrote.
The judge said Texaco, and by extension Chevron, "might bear some
responsibility" for pollution at the site but that it was irrelevant
to the question of whether fraud had occurred.
"Justice is not served by inflicting injustice," Kaplan wrote. "The
ends do not justify the means. There is no 'Robin Hood' defense to
illegal and wrongful conduct."
During the non-jury trial, which ended in November, Kaplan heard
from 31 witnesses and considered written testimony from 37 others.
Chevron also introduced reams of documents, including Donziger's
personal notebook, purporting to show that he was involved in a
wide-ranging fraud.
Among the witnesses was the former Ecuadorean judge who issued the
2011 judgment, Nicolas Zambrano, who testified that he had received
no money and had written the opinion without outside assistance.
But Kaplan agreed with Chevron that the evidence showed Zambrano did
not write the ruling himself. Instead, Kaplan, said, the plaintiffs'
team wrote the judgment, and Zambrano simply signed his name to it.
Another former Ecuadorean judge, Alberto Guerra, testified that
Donziger's team paid him to ghost-write Zambrano's opinion.
Donziger's lawyers pointed out that Chevron had compensated him for
testifying and paid for his family's living expenses.
Chevron's lawyer, Randy Mastro of Gibson Dunn, pointed to sections
of the ruling that appeared to be copied word-for-word from internal
documents held by Donziger's team in Ecuador as proof, saying they
were "like fingerprints."
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
Meredith Mazzilli, Andrea Ricci and Richard Chang)
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