U.S. attorney who won judgment for Ecuadorians against Chevron may get his day in court

Nov 23, 2018

By Frank Bajak

A New York attorney who won a landmark oil pollution judgment against Chevron in Ecuador’s court system only to have his law license suspended at home for professional misconduct never got a fair hearing and should be allowed to defend himself against disbarment, a legal referee has ruled.

Stephen Donziger in Ecuador

The decision involves Steven Donziger, who led a legal team representing Ecuadorians trying to get Chevron to pay for environmental damage caused to a rainforest by Texaco during its operation of an oil consortium from 1972 to 1990.

The legal campaign begun in 1993 was ultimately successful in Ecuador. A court there ordered Chevron to pay $9.5 billion. But in 2014, a judge in New York, U.S. District Judge Lewis A. Kaplan, invalidated the Ecuador judgment, deeming it was obtained through fraud, bribery, witness tampering and other misconduct.

In July, a New York State appeals court suspended Donziger without a hearing based on Kaplan’s ruling that the attorney’s Ecuador team submitted bogus evidence, ghostwrote a court-appointed expert’s report and promised $500,000 to the Ecuadorean judge to rule in their favor.

Donziger fought those findings and denies he offered or paid bribes.

A court-appointed referee, John R. Horan, ruled on Nov. 8 that Donziger deserves a hearing to defend himself. He also questioned whether Kaplan violated Donziger’s constitutional right to due process.

Kaplan effectively “created a criminal indictment” and tried Donziger for conspiracy, Horan said.

“It is doubtful that if an indictment in the same terms had been brought by the United States Attorney, (Donziger) would have elected to have a trial by a single judge and would have waived his right to a trial by jury,” the referee wrote.

Horan said he would grant Donziger two days beginning Dec. 4 to argue why he should not be disbarred.

The chief attorney for the New York State grievance committee trying the case, Jorge Dopico, filed a motion on Nov. 15 arguing that Horan had no right to re-examine Kaplan’s ruling and asking a state appeals court to cancel the Dec. 4 hearing.

A spokeswoman for Dopico said he does not comment on disciplinary cases. The referee, Horan, said he could not discuss the case because the court had marked it confidential.

The state court in New York suspended Donziger for “serious professional misconduct which immediately threatens the public interest” four years after Kaplan’s ruling. The District of Columbia also suspended his law license.

Under New York’s disbarment procedure, the court renders a verdict after receiving the recommendation of the court-appointed referee, who is not a court employee.

Martin Garbus, a renowned constitutional lawyer representing Donziger in the case, said its importance goes far beyond the particulars of the environmental dispute because of the precedent it could set for all attorneys in the country.

“I have never seen anything like this before,” he said. “We never in American history have seen a case where the judge turns it into a disbarment proceeding.”

“They’re trying to break him in half,” Garbus said of Chevron’s treatment of Donziger, painting him as a solitary David against a deep-pocketed corporate Goliath.

Chevron did not directly respond to comment on Garbus’ claim. It did note, however, that the Kaplan judgment was final in the U.S. given that it was upheld by an appeals court and that the U.S. Supreme Court refused to review the case.

Donziger said he will appeal, if necessary, to the U.S. Supreme Court.

Chevron became involved in the Ecuador pollution dispute by buying Texaco. Chevron has long argued that a 1998 agreement Texaco signed with Ecuador after a $40 million cleanup absolves it of liability and says that Ecuador’s state-run oil company is responsible for “any existing environmental and social conditions in the area.”

The Ecuadorian plaintiffs say the cleanup was a sham and didn’t exempt third-party claims.

An international arbitration tribunal in the Hague ruled in August that the $9.5 billion judgment against Chevron obtained in 2011 by plaintiffs represented by a legal team led by Donziger violated Chevron’s rights. It ruled the judgment should not be recognized or enforced because parts of it were “corruptly ghostwritten” in return for the promise of a bribe. The tribunal did not, however, absolve Chevron of potential liability for pollution.

Chevron insists there is no merit to the allegations of environmental harm.

Credit: Associated Press, www.apnews.com

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