Ecuador charges Chevron with pollution case ‘smear campaign;’ Chevron calls recent court ruling ‘illigitimate’

Nov 27, 2013

The rhetoric is heating up in the legal battle between Chevron Corp. and Ecuador over oil pollution in the 1970s. Ecuador charges that Chevron is engaging in a “smear campaign” while the oil company calls Ecuador’s claim for environmental damage “illigitimate.”

Ecuador’s Minister of the Environment Lorena Tapia is inviting prominent figures, including government officials, from around the world to visit the Amazonian provinces of Sucumbios and Orellana to check out oil spill damage for themselves. Tapia offered the invitations at a U.N. climate summit in Warsaw earlier this month, where she also pushed Ecuador’s argument.

chl oilMeanwhile, Chevron has rejected as “illegitimate and unenforceable” an Ecuadoran court ruling upholding an order for it to pay billions of dollars for environmental damages to the Amazon. Ecuador’s Supreme Court upheld a lower court decision against Chevron two weeks ago but dramatically reduced the amount to be paid in damages from $19 billion to $9.51 billion.

In 2011, a court in Sucumbios ruled in favor of 47 plaintiffs representing 30,000 mainly indigenous villagers who accused Texaco of dumping billions of gallons of toxic drilling waste in a 480,000-hectare (1,850-sq.-mile) jungle area. Chevron purchased Texaco in 2000, inheriting its legal responsibilities.

Texaco’s activity “took place when environmental regulation was weak in Ecuador and a government that defends the rights of Ecuadorians did not exist,” Tapia said.

Chevron admits that Texaco contributed to environmental damage but says that it was working under Ecuador’s envirnomental rules of the time and that the government signed off on its remediation work. Chevron also says that government-owned PetroEcuador is responsible for much of the damage.

The Amazonian plaintiffs initially sued Texaco in New York in 1993, but Chevron succeeded in having the case moved from the United States to Ecuador in 2003, four years before President Rafael Correa came to power in Quito amid voter anger at corruption and traditional politicians.

Chevron, however, later said the case had become politicized under the leftist Correa, a U.S.-educated economist, and that it could not receive a fair trial.

The California-based energy giant is currently suing Ecuador before The Permanent Court of Arbitration in The Hague for exploiting the Amazon lawsuit against Chevron and failing “to uphold its duties under decade-old contracts.”

Chevron argues that under the terms of a 1997 investment protection accord between Washington and Quito, the Ecuadorian government should be responsible for paying the judgment in the Amazon case.

Though the company maintains Texaco was released from liability after performing remediation work in the mid-1990s, plaintiffs say the 1998 agreement with the then-Ecuadorian government did not preclude third-party claims.

They also point out that Chevron pledged back in 2003 to abide by whatever decision was handed down by the Ecuadorian courts.

Besides the arbitration case, Chevron also brought racketeering charges in U.S. federal court against the plaintiffs’ lawyers and consultants, accusing them of engaging in fraud and trying to extort a financial settlement.

“Chevron has lied,” Minister Tapia said. “We have seen ourselves obliged to intervene because Chevron has initiated a smear campaign against the government of Ecuador, discrediting our image, saying that we as a government have intervened in the (Sucumbios) trial.”

“This has made it necessary that we defend ourselves and tell the world what has really happened,” she said.

Credit: Portions of this article are from Fox News Latino, latino.foxnews.com/latino; Photo caption: Polluted holding pond in the Amazonia.

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