Ecuadorean Court has Ordered US Oil Giant Chevron to pay $8.2 ~ 9.0 Billion for Environmental Damages.

HUGE VICTORY FOR ECUADOREAN PEOPLE AGAINST CHEVRON OIL...

QUITO | Mon Feb 14, 2011 2:20pm EST
Feb 14 (Reuters) - An Ecuadorean lawyer for the plaintiffs said on Monday that a court in the Amazon city of Lago Agrio had ordered U.S. oil giant Chevron (CVX.N) to pay more than $8 billion in environmental damages.

Plaintiffs had originally asked for $27 billion. (Reporting by Quito Newsroom)

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~ CHEVRON IN AN ATTEMPT TO STALL...
continues to drag their feet with Yet more legal maneuvering~
~ Gerard Ange'
>>> BEGIN CHEVRON STORY:

Chevron Corp., the second-largest U.S. oil company, faces at least $8.2 billion in damages after losing an Ecuadorean lawsuit that alleged the company is responsible for chemical-laden wastewater dumped in the Amazon River basin more than 20 years ago.

The decision arises from an 18-year-old lawsuit by Ecuadoreans that sparked accusations of corruption and deception by the company and lawyers for the plaintiffs. Chevron won a Feb. 8 court order in New York barring the Ecuadoreans from attempting to enforce the judgment in the U.S. or elsewhere. Chevron has no assets in Ecuador.

The ruling requires Chevron to pay $8.2 billion to $9 billion in damages, Karen Hinton, a spokeswoman for the plaintiffs’ lawyers, said in a telephone interview today. Kent Robertson, a spokesman for San Ramon, California-based Chevron, said in an e-mail he didn’t know what the damage amount was.

“The case really sends a message that companies operating in the undeveloped world cannot rely on a compliant government or lax environmental rules as a way of permanently insulating themselves from liability,” said Robert Percival, a law professor and director of the environmental law program at the University of Maryland School of Law in Baltimore.

The lawsuit seeks to hold Chevron responsible for water and soil contamination that allegedly caused Amazon residents $27 billion in damages from illness, deaths and economic loss. Texaco, acquired by Chevron in 2001, allegedly dumped chemical- laden oil drilling waste in hundreds of small ponds dug from 1964 to about 1992, according to the plaintiffs.

PetroEcuador

Chevron said it cleaned up its portion of the oil fields and was released from pollution claims in an agreement with Ecuador and PetroEcuador, the state-owned oil company that took over the Texaco operations in 1992.

“The Ecuadorean court’s judgment is illegitimate and unenforceable,” the company said in a statement today. “It is the product of fraud and is contrary to the legitimate scientific evidence. Chevron will appeal this decision in Ecuador and intends to see that justice prevails.”

Chevron rose $1.22, or 1.3 percent, to $96.95 at 4 p.m. in composite trading on the New York Stock Exchange, its biggest gain in two weeks.

Second-Largest Damages

The judgment would rank second in environmental damage cases behind the $20 billion Gulf Coast Claims Facility, a settlement fund set up for BP Plc’s Gulf of Mexico oil spill, said Percival.

“Today’s judgment affirms what the plaintiffs have contended for the past 18 years about Chevron’s intentional and unlawful contamination of Ecuador’s rainforest,” Pablo Fajardo, the lead Ecuadorean plaintiffs’ attorney, said in an e-mailed statement.

The lawsuit, brought on behalf of 30,000 residents of Ecuador’s Amazon, was first filed in federal court in New York in 1993. After Chevron argued that the case should be heard where the alleged contamination occurred, the case was refiled in Ecuador in 2003.

Chevron has accused the Ecuadorean government of unfairly influencing the court proceedings and alleged that a $27 billion damage assessment provided by a court-appointed expert was ghostwritten by consultants and lawyers hired by the plaintiffs.

The company won U.S. court orders last year that forced attorneys and consultants for the Ecuadoreans to answer questions under oath about the case and gave Chevron access to outtakes of a documentary film about the lawsuit.

Racketeering Lawsuit

Chevron in February filed a racketeering lawsuit against the lawyers and the plaintiffs in federal court in Manhattan for “leading a fraudulent litigation and PR campaign against the company.” The company filed a claim in 2009 against Ecuador in the Permanent Court of Arbitration in The Hague seeking orders that it has no liability for the environmental pollution and PetroEcuador should pay the damage award.

Lawyers for the plaintiffs have said there’s evidence of contamination at all 45 former well and oil production sites inspected during the case. Chevron engaged in a campaign to discredit them, entrap an Ecuadorean judge that presided over the case and set up dummy corporations in Ecuador to hide the company’s role in testing soil samples from the pollution sites, the lawyers have said.

The case is Maria Aquinda v Chevron, 002-2003, Superior Court of Nueva Loja, Lago Agrio, Ecuador.

To contact the reporters on this story: Joe Carroll in Chicago at jcarroll8@bloomberg.net; Karen Gullo in San Francisco at kgullo@bloomberg.net.

To contact the editors responsible for this story: Susan Warren at susanwarren@bloomberg.net; David E. Rovella at drovella@bloomberg.net

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