Tuesday, July 1, 2014

How Chevron Cheated Ecuador's Courts From Hearing Evidence of Its Contamination

Remember the names Sarah McMillan, John Conner, and Bjorn Borkman.  

They are Chevron scientific consultants who tried to defraud Ecuador’s courts with trickery and flat-out lies.  Their dishonest work likely will be viewed with great interest in foreign courts that are looking to seize Chevron assets to pay for the company's liability in Ecuador.

We practically fell off our chair when we read the details of this group's subterfuge in a recent court filing (see pp. 33-85 of this legal brief).    Chevron is certainly creative when it comes to cheating.

None of this should come as a surprise.  

We recently reported that a new study by a prominent U.S. scientific consultancy (the Louis Berger Group) yet again confirms that Chevron is responsible for discharging billions of gallons of toxic “water of formation” into the streams and rivers of the rainforest in order to artificially inflate its profits.  The consultancy also confirmed the gritty details of how Chevron tried to trick judges during the Ecuador trial, which concluded in 2011 with a stunning judgment against the company.  

We note that Chevron’s trickery is on top of the company's intimidatin campaign  -- including efforts to threaten Ecuador’s judges with jail time and to paralyze the court by drowning it with frivolous motions.  

The deceptions deployed by McMillan (who is Chevron’s chief scientist) and tainted consultant John Conner have come to light in a legal brief filed by Ecuador’s government in its arbitration dispute with Chevron.  The American law firm Winston & Strawn (which represents Ecuador) quietly has been forcing Chevron to disclose documents that prove the company tried to corrupt the Ecuador trial.

Examples of Chevron’s tricks as described by Winston & Strawn include:

** Conner wrote a playbook directing the company’s field technicians to find only “clean” soil during the judicial inspections by sampling in areas up-gradient from visibly contaminated waste pits.  Chevron’s technicians then tried to act like they were engaging in “random” sampling in front of the judge.

**As confirmed by Bjorkman, Chevron conducted secret pre-inspections of several of the company’s former well sites where it found numerous dirty soil samples that far exceeded Ecuadorian regulatory norms.  Rather than report these samples to the court, the company hid the results.

(This critical data as well as the evidence of Chevron's corruption was not reviewed by U.S. Judge Lewis A. Kaplan is his tainted and farcical RICO trial against the Ecuadorians and their counsel.  This evidence will be reviewed by enforcement courts that are being asked to seize Chevron’s assets to force the company to comply with the Ecuador judgment.)

**Chevron’s Ecuadorian lawyers  -- led by the notorious Adolfo Callejas -- lied to the Ecuador court by claiming the company never performed the tests during its secret pre-inspections.  (See p. 65 of the aforementioned legal brief.)

**During the official judicial inspections (when the judge was present), Chevron tried to take soil samples from the shallow surface layer of dirt that it used to cover its oil waste pits during a sham remediation in the mid-1990s.  Yet data showed that several feet below where Chevron was sampling, the waste pits were saturated with oil that was contaminating soils and groundwater.

**A Chevron operative, Diego Borja, confessed on tape that he would often switch dirty samples for clean ones before submitting them to laboratories for analysis.  He also confessed that the company set up dummy “independent” labs that  actually were controlled by Chevron.  For more on Borja and his corrupt activities, see here

**McMillan’s team also mixed dirty soil with clean soil from the same site so as to artificially lower the average of the contamination found.

**Chevron never tested for key markers of oil contamination, such as Total Petroleum Hydrocarbons.  Instead, it tested for more narrow constituent elements that made the contamination appear less extensive than it really was.

**Chevron used two inappropriate laboratory tests (TCLP and Method 8015) that made it virtually impossible to detect illegal levels of contamination, even from oil-saturated soil.  Method 8015 counts only 50% of the hydrocarbons in petroleum, while the TCLP test often captures less than 1% of the actual contamination. 

(The TCLP test runs water over soils contaminated with hydrocarbons, and measures the amount of hydrocarbons in the runoff.  Because water and oil don’t mix, the runoff contains almost none of the oil in the soil.)

**Chevron’s team also refused to test for an extremely toxic class of Polycyclic Aromatic Hydrocarbons that are harmful to human health -- apparently knowing that such tests would point to its guilt.

**Chevron blamed high cancer rates and other health problems on the presence of fecal matter even though there is no scientific evidence connecting fecal matter with cancer.  The high rates of cancer and risks to human health have been confirmed in several peer-reviewed studies by independent doctors.  

The legal brief captured the company’s subterfuge:

Chevron has expended tremendous sums on expensive experts, laboratories, and technology.  Armed with its deep resources, Chevron systematically and deliberately devoted time and money to detect where contamination exists and where it does not.  Chevron then systematically did everything in its power to avoid sampling at the most contaminated locations, thereby seeking to minimize its findings of contamination, all the while contending that its anything-but-random samples [during the official judicial inspections] were “representative” of the whole.  They were not.

We admire the restraint of the writer.  It’s not often one can clinically describe an outright fraud by an American oil company designed to hide one of the world’s worst ecological catastrophes.  

Despite the trickery, Chevron still submitted enough soil samples to the Ecuador court from the official inspections to prove the claims against it.  This underscores just how saturated with oil waste Chevron's facilities are years after it fled the country.

Incredibly, additional proof of Chevron’s deceit was captured by the oil company itself on videos it made of its secret pre-inspections.  

Chevron’s video outtakes – which the company has asked courts to seal – show field technicians laughing at the contamination and mocking the Ecuador court process.   A Chevron whistleblower turned them over to a U.S.-based environmental organization.  It is highly doubtful the company can keep them under wraps forever.
As we have reported, the LBG report validates the decisions of three layers of courts in Ecuador that found the company liable and imposed the damages award.  The amount ($9.5 billion) surely must sting in the Chevron boardroom.  But it is actually a modest penalty taking into account the venality of the company’s misconduct and the magnitude of the damage.  BP’s liability is three times higher (and rising) for the far smaller Deepwater Horizon spill.

Chevron of course admitted to deliberately dumping at least 16 billion gallons of oil-laced produced water when it operated in Ecuador from 1964 to 1992.  The company also abandoned more than 900 unlined waste pits gouged out of the jungle floor.  Cancer rates in the region, where an estimated 200,000 people live, have skyrocketed

We note that McMillan, Conner, and Bjorkman are not the only “academics” willing to sell their integrity to Chevron for money and make themselves complict in human rights abuses.  The company also has submitted to courts reports from Douglas Southgate, who is associated with a think tank that denies conventional theories about global warming; and the infamous Ralph Marquez, formerly the lead lobbyist for the chemical industry in the state of Texas and a Chevron consultant. 

When Chevron management decides to do business with dogs like this, everybody associated with the company gets fleas.  No reputable academic would even think of working under McMillan, whose entire purpose is to obfuscate the truth and to cast doubt on the overwhelming scientific evidence of the company's crimes.