Monday, September 16, 2013

Bribery Bombshell Threatens Chevron Legal Strategy In Ecuador Case

Late last week, lawyer Steven Donziger and the Ecuadorian villagers who have fought for decades to force Chevron to clean up its poisonous mess in their rainforest lands filed a motion in U.S. Federal court that could spell an end to the oil giant's legal maneuverings and attempts to evade responsibility for its toxic legacy in the Amazon.

According to the filing, Chevron has engaged in a “pattern of misconduct and corruption” including offering a $1 million dollar bribe to the Ecuadorian judge who ruled against the company in 2011, and ordered Chevron to pay $19 billion in compensatory and punitive damages.

A press release on Friday announced the bombshell revelations contained in the motion, which called for Chevron's retaliatory RICO suit—currently scheduled to go on trial in mid-October—to be terminated.

The filing outlines Chevron’s unlawful payments and bribes to witnesses and concludes that this conduct has “so damaged the integrity” of the proceedings that at this point, a fair trial is simply impossible.

“When the conduct is this egregious, there is simply no other way to ensure justice than to end the entire proceeding,” said Christopher Gowen, an attorney and spokesman who is advising the Ecuadorians and their attorney, Steven R. Donziger.

Supporters of the Ecuadorian indigenous and farmer communities who have suffered most from the massive oil pollution for which Chevron was found culpable, will be familiar with some of the cynical efforts the oil company undertook to corrupt the Ecuadorian legal proceedings since the trial opened in the oil boom town of Lago Agrio in 2003.

Last week's motion from the Ecuadorians and their US lawyer Steven Donziger lay out the sordid case of Chevron's admitted dirty tricks operative Diego Borja and the secret labs he helped set up to manipulate pollution sampling in the trial. The latest motion recounts the airtight evidence regarding Borja—including recordings of Chevron's former contractor admitting that the oil giant would lose the trial “like this” (with a snap of his fingers) if he revealed all the evidence he possesses of the company's guilt for contamination in Ecuador. But Chevron has paid Borja a staggering sum of $2.2 million in hush money, according to the filing.

But the bombshell in this latest motion is Chevron's attempt to bribe the judge who ruled against the company in 2011, after an epic 8-year trial. According to the press release:

One of the illicit payments – in the amount of $1 million -- was offered as a bribe to the Ecuador judge who wrote the opinion finding Chevron liable for $19 billion in damages for dumping toxic waste into the rainforest. The bribe was intended to coax the judge, Nicolas Zambrano, into renouncing his own ruling which was based on a 220,000-page evidentiary record accumulated over an eight-year trial, according to a sworn affidavit cited in the motion.
Zambrano intends to testify about the bribe offer in the RICO case should it proceed to trial as scheduled in mid-October, according to a recent court filing. Chevron filed the RICO action in New York federal court as a last-ditch attempt to thwart the Ecuador court judgment; the company was also countersued for fraud and extortion by Donziger, who has advised the Ecuadorians for two decades. (A summary of the overwhelming evidence against Chevron as found by the Ecuador court can be read here.)

The press release provides a summary of the evidence of Chevron’s illegal payments and bribes as outlined in the motion:

**Chevron lawyer Andres Rivero and another Chevron agent known as “Investigator #5” used a former Ecuadorian judge and key Chevron witness (Alberto Guerra) as a conduit to offer the $1 million bribe to Zambrano, whose sworn affidavit is available here. Rivero recorded himself paying Guerra thousands of dollars in cash out of a suitcase during a secret meeting in Ecuador. Guerra presided over the case for three months in 2003.
**Chevron signed a contract guaranteeing Guerra payments at least ten times his annual salary as an Ecuadorian judge in exchange for false testimony where he claims the Ecuadorian plaintiffs bribed him. The exorbitant payments were arranged directly in a meeting in Chicago by Randy Mastro, Chevron’s lead outside counsel at the law firm of Gibson Dunn & Crutcher. Mastro’s practice group already has been sanctioned once by a federal judge in the case for engaging in unethical conduct.
**The filing asserts that the benefits given to Guerra constitute criminal violations that run afoul of the Federal Anti-Gratuity Statute, which prohibits payments to non-expert witnesses for testimony. The argument that the payments to Guerra are illegal is supported by a sworn affidavit provided by Erwin Chemerinsky, a prominent ethics expert and Dean of the law school at the University of California, Irvine.
**The motion documents that Chevron, by its own admission, not only paid Guerra cash from a suitcase but moved his entire family to the United States; promised him an annual salary of $144,000, or roughly 30 times the per capita annual income in Ecuador; has provided him a car, health insurance, cell phones, a housing allowance, and payments for travel expenses and an immigration lawyer who happens to be none other than Ira Kurzbam, former President of the American Immigration Lawyers Association. Chevron appears to be helping Guerra seek political asylum in the U.S. under false pretenses, said Donziger.
**The motion also outlines $2.2 million in payments and “hush money” Chevron made to employee Diego Borja. Borja, who worked for Chevron’s legal team in Ecuador since 2004, has admitted on tape that he was the company’s “dirty tricks” operative during the Ecuador trial. He also admitted he tried to entrap a sitting judge in a bribery scandal, set up dummy companies, and that he and his wife ran a supposedly independent laboratory actually controlled by Chevron. For background on Chevron’s attempts to corrupt the Ecuador trial through Borja, see here.
**Chevron also used “coercion and the threat of financial ruin” to blackmail two U.S. scientists, Douglas Beltman and Ann Maest, into disavowing their prior sworn testimony that the oil company is responsible for extensive toxic pollution in Ecuador. Chevron even contacted clients of Stratus to falsely claim that the company had been found to have committed “fraud” in Ecuador as a way to pressure the scientists to “flip” to Chevron’s side.
**Chevron also engaged in witness tampering by coercing Christopher Bogart – a former financial backer of the Ecuadorians who runs a litigation hedge fund – to submit a false affidavit claiming he was misled about key parts of the underlying case. Bogart already has been discredited as a liar in a separate court filing that seeks to exclude his testimony.

According to the press release from Gowen, an American University law professor, Chevron is “reeling over the risk posed by its own RICO allegations given the obvious credibility problems of its witnesses.” Gowen also says that Chevron appears “utterly desperate” to avoid a jury trial in the RICO case.

Finally, the motion highlights the misconduct of the lawyers from Chevron's outside legal firm Gibson Dunn, & Crutcher.  It cites their “track record of presenting false or misleading testimony to U.S. courts on behalf of their corporate clients,” according to the press release. The motion requests legal sanctions of Randy Mastro, Andrea Neumann and Scott Edelman, who have been the architects of Chevron's legal strategy in their efforts to evade accountability.

With each passing day, Chevron looks increasingly desperate to avoid a jury trial in its retaliatory RICO suit.  Its best hope is for some sort of legal end-around that will allow its favored U.S. judge, Lewis Kaplan, to rule alone, virtually guaranteeing an outcome in Chevron's favor that almost certainly will not withstand an appeal. And with each passing day, the company's pathway to impunity for its crimes in Ecuador becomes more cluttered with roadblocks, fashioned from the perseverance of the communities in Ecuador's Amazon who continue to fight for justice.

For background on how Chevron decimated indigenous and farmer communities by dumping billions of gallons of toxic waste in Ecuador’s Amazon, watch this video overview or this 60 Minutes segment, or review this summary of the overwhelming evidence against the company.  Chevron is now fighting a $19 billion judgment against the company.

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