Respectfully submitted by Lawrence E. Rafferty (rafflaw)- Guest Blogger
Back in July of this year, we discussed a successful request by oil giant Chevron to subpoena 9 years of metadata from countless defendants and non-defendants. This was arguably an attempt to attack a $19 Billion dollar judgment handed down by an Ecuadorian court against Chevron by going after the parties involved in the lawsuit.
Chevron was not deterred when the United States Supreme Court refused to review the judgment. It merely went on the attack and found an allegedly friendly judge in New York to assist in refusing to pay the judgment owed to various indigenous communities that were devastated by Chevron’s predecessor’s actions in the rainforests where it was drilling for oil. We need to revisit this issue now that the RICO action filed by Chevron started this week in New York.
“But have you heard of Hugo Camacho? Or Javier Piaguaje? They’re not exactly household names. Nor gangster names for that matter. And that’s because one is a campesino farmer that makes about $200 a month growing cacao. The other is a leader of the Secoya indigenous people, and both are from the rainforests of Ecuador’s Amazon. Their crime? Suing the second largest oil company for the worst oil-related environmental disaster on the planet. And winning.
But starting today in a lower Manhattan courthouse, they are being accused using the same criminal statute under which the big crime bosses of our time have been prosecuted: Racketeer Influenced and Corrupt Organizations Act (RICO). It’s the latest in Chevron‘s scorched earth campaign to avoid paying a record environmental verdict against the company for massive contamination stemming from its operations in Ecuador’s Amazon between 1964 and 1990.” Reader Supported News
Our article in July discussed the First Amendment issues that occurred when Chevron subpoenaed the enormous metadata records of the successful Ecuadorian plaintiffs. Chevron is now proceeding with the RICO action claiming that the Ecuadorians engaged in fraud and therefore Chevron should not be required to pay the $19 Billion dollar judgment. You probably know that RICO stands for “Racketeer Influenced and Corrupt Organizations Act (RICO).”
The RICO act was designed to prosecute United States crime families and mob bosses and Chevron is using it to hide from a judgment that it doesn’t want to pay. It doesn’t want to pay it even though it was decided in a forum that Chevron requested. Complicating matters for the judgment creditors is the fact that Chevron does not own any assets in Ecuador. The judgment creditors are attempting to collect against Chevron in countries where it does own assets, but it is a long and expensive process.
Speaking of expenses, Chevron has hired a legal army in its attempt to avoid paying the judgment. “But Chevron, armed with more than 60 legal firms, some 2,000 legal professionals, top PR companies, the shadowy “investigative and risk” management firm Kroll and endless resources, has tried to outlast and vanquish the Ecuadorians and their advocates like Donziger. Unable to put a pair of cement shoes on him and drop in the Hudson, Chevron has ironically gone after Donziger and the Ecuadorians with a statute that is better applied to the company itself. Is there a business more fitting of RICO charges than the oil industry?” Reader Supported News
Does anyone else find it disturbing that a large oil company like Chevron, would not only hide from its lawful obligations to pay up for its disastrous practices in drilling for oil, but would personally attack the successful judgment creditors? I realize that the Supreme Court considers corporations to be people. Shouldn’t the people of Chevron be required to pay their bills like the rest of us?
This is a real life David versus Goliath moment. Would it be important to you in your review of this case to know that the judge, Lewis Kaplan, has a connection to Chevron? “After forum shopping for several years, Chevron found an ally in Judge Lewis Kaplan, who had worked previously for a firm that represented Chevron. Kaplan actually invited Chevron to bring RICO charges.” Reader Supported News
Since Chevron is alleging fraud on the parts of the judgment creditors, it is important to review Chevron’s actions during the trial process in Ecuador. I apologize for the length, but Chevron was so “busy” in Ecuador, that it is important to see the full extent of its activities there.
“When the Second Circuit Court of Appeals for New York remanded the case to Ecuador, a caveat of Chevron’s compliance with any judgment was if any type of fraud occurred. And that is what Chevron is conveniently now claiming. And fraud did occur alright, and many of Chevron employees should be in jail for engaging in it.
During the trial in Ecuador, Chevron:
- Orchestrated a deceptive “sting” operation involving a former Chevron employee and a convicted felon who attempted to bribe the sitting judge.
- When the scandal unraveled, Chevron helped move the former employee to the U.S. and continues to pay his rent, legal counsel and a generous monthly salary, though he does no work for the company.
- Worked with the Ecuadorian military to fabricate a false military report which delayed crucial judicial inspections of contaminated sites.
- Selected soil and water samples from conveniently illogical places, such upstream from contamination sources.
- Used an “independent” laboratory operated by the wife of a Chevron employee to process its sampling evidence, where samples were swapped or destroyed.
- Offered a former judge in the case a literal “suitcase full of cash” and helped move him to the U.S., where Chevron provides him with payments of $144,000 per month-approximately 30 times the basic salary in Ecuador.
- Offered the judge who issued the verdict a $1 million bribe in exchange for a favorable verdict. He rejected the bribe.” Reader Supported News
I guess I shouldn’t be surprised that an oil corporation might take dubious steps in attempting to hide from a lawful judgment. What is a surprise to me is that a United States court would allow the RICO statute to be utilized to shield that corporation/person from a lawful foreign judgment. What do you think?
Additional References: Common Dreams;
ccrider27,
Thanks for the recommendation of the movie “Crude”.
Bron,
Chevron bought this problem when they bought the company. The courts in Ecuador found for the communities that sued Chevron and the US Supreme Court declined Chevron’s appeal. It said a neat package. If you read all,of the links you will see the damage one. It is not pretty.
I boycott BP, Chevron, Exxon and Shell.
One added point: The movie “Crude” is all about this issue and describes the illegal activities by Texaco in great detail.
Highly recommended.
blhlls:
so Petroecuador was contracting to Texaco/Chevron? Why didnt they intervene early on if there was an environmental problem?
A possible reason was to displace the indiginous people from their land, it is not like other South American countries havent tried.
So this isnt a nice neat package after all.
Interestingly Petroecuador which was the majority owner and took over the whole show in the early 90s and continued the contaminating conduct, and may have increased it, was not included as a defendant in the underlying litigation.
Judge Kaplan should be scrutinized and his bank accounts examined for payoffs
They tossed OUR TROOPS into the meat grinder for Iraq oil, why be surprised they are willing to do the same thing to others!?!?
It was cheaper to pay a judge $20,000 under the table than pay a $19 billion fine.
so what is the background for this story? How bad is the pollution? Did Texaco/Chevron follow Ecuadorian environmental laws? What damage has been done? What did the contracts with the Ecuadorian government require?
From personal experience in the early 80’s, oil companies are pretty good at keeping their sites clean and contained. On land and offshore. I cant speak to the 60’s and 70’s nor to overseas operations.
I definitely think that the Supreme Court needs to stop being idiotic and take action against Chevron, this is not right.
randyjet 1, October 20, 2013 at 11:42 am
It is time to revoke Chevron’s corporate charter, and prosecute the officers of the company. RICO is more aptly applied to the company officers than the poor Ecuadorans.
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These corporations, in their own words, are not American:
(MOMCOM: The Private Parts – 4). While it is true that a corporation is a state law entity, not a federal entity, their strongholds are in foreign nations.
Obviously, the country that entered a judgment against one of Oil-Qaeda’s finest has not heard the end of this heresy against Oil-Qaeda.
Since the U.S. Department of “Justice” chooses NOT to prosecute Chevron management and their Board of Directors – what about the ICC (International Criminal Court) prosecutors?
Doesn’t the “Citizens United” Supreme Court ruling allow “persons” to take personal responsibility for their actions in addition to Free Speech rights?
Your posting seems to be a little biased (no … a lot biased). For an offsetting piece, go the Wall Street Journal article at:
http://online.wsj.com/news/articles/SB10001424127887323826804578466942506073914?KEYWORDS=chevron+RICO
Corporations have been allowed to “legally” terrorize their employees, their customers and the communities in which they perform their extractions for so long that they see themselves as more than people; they see themselves as a nation states with all of the powers and rights even to the extent that some oil companies actually fund armies. The US Congress has allowed this to happen. The Supreme Court has turned its back while corporations with significant ties to the US get off the hook but claiming “foreign citizenship” to avoid liability to their victims. I suggest that this RICO law suit and the Judges complicity in it is a good basis for Holder to move against both. Will he do it? I wouldn’t hold my breath.
There is something left out of this article. As long as extra-national corporations can appeal to the greed and lust for power in nations whose citizens have suffered harm, they can get away with nearly anything. Chevron, which in fairness took over Texaco’s problems (though, according to the article agreed to do so), could never pull this off w/o a lot of help in Ecuador.
This is not a situation analogous to African tribes that assisted European slavers by bringing prisoners & various captives to be shipped off to slavery. In that situation there was no basis for a concept of unity via nationhood, or for that matter colour. Ecuador is, and has long been a sovereign state. The Ecuadorians, be they military or civil authorities, are harming their fellow citizens. Whatever feelings are engendered by this situation seem to be overshadowed by greed & corruption.
“Patriotism” is a concept often derided by the left, and liberals in general. But in a culture that accepts a way of life literally “hollowed out” by corruption, what is to stop an entity such as Texaco-now-Chevron but for Patriotism? Ecuador’s morality and sense of ethics are already dominated by the Catholic Church. The country is not missing ideas of right and wrong being culturally prevalent. But the lust for power- greed, avarice, and all that goes with it have resulted in a tiny percentage of Ecuadorians prospering even if it meant the death or ruination of their fellow citizens.
I wish the precepts and actions of the Catholic Church could have prevented the decades of criminality by the few Ecuadorians cooperating with Texaco. But the Church failed. It would have been nice if when Texaco or Chevron came around to bribe members of the military, the military started arresting the Oil Company’s personnel. And started arresting bribed soldiers and officers based on treason. The Ecuadorian Navy & Coast Guard is hardly huge, but its big enough to seize a Chevron tanker & bring it into a “neutral” port and ask it be adjudicated as a prize. It could even bring it into an American port and ask the Federal District Court to act as a Court of Admiralty, sitting as a Prize Court.
There are a dozen reasons why seizing a tanker with Chevron oil and asking it be adjudicated as a prize would not work. Everything from treaties signed in the 19th Century, to the present state of U.S. statutes on prizes, to there being no state of hostilities, to international law on piracy. But, it would garner lots of attention and publicity to the problem, and maybe even force a resolution. And it’s the sort of act that Patriots do for their countrymen.
And let’s not Lewis Kaplan when mounting an investigation.
It is time to revoke Chevron’s corporate charter, and prosecute the officers of the company. RICO is more aptly applied to the company officers than the poor Ecuadorans.
Holder should also require the DoJ to investigate Chevron for multiple violations of US law in bribing foreign officials.
“Does anyone else find it disturbing that a large oil company like Chevron, would not only hide from its lawful obligations to pay up for its disastrous practices in drilling for oil, but would personally attack the successful judgment creditors?”
Disturbing? A bit. Revolting? Certainly. Unexpected? Not in the slightest.
If you mention the words “ethical behavior” to an oil executive, they will burst into flame like a vampire exposed to the sun.
RICO is a valuable and powerful tool that is not being used by prosecutors for what it was intended for because if it was, it would be Chevron’s management on the pointy end of a RICO case. Along with Exxon, BP, Halliburton and just about every large company involved in Big Oil.
[I think Amerika is a criminal state, and I am not surprised by all the illegalities.]