Chevron is on the ropes yet again in the Ecuador pollution case as its main defense continues to unravel, according to prominent appellate lawyer Deepak Gupta of the Gupta Beck law firm in Washington, D.C.
An explosive new forensic report from Ecuador's government filed recently before a federal appellate court in New York proves that U.S. Judge Lewis A. Kaplan accepted false evidence from a paid witness to try to help Chevron evade paying its $9.5 billion pollution liability to rainforest villagers in the South American nation, according to Gupta. Gupta's letter brief on the issue can be read here.
Gupta has charged Chevron with presenting false testimony to try to frame his client, New York-based human rights lawyer Steven R. Donziger. Chevron's goal for years has been to evade paying the court judgment in its chosen forum of Ecuador, primarily by trying to demonize Donziger to distract attention from its own crimes and fraud. Donziger has been working on the case for 22 years.
Chevron executive Rodrigo Perez Pallares admitted during an eight-year trial in Ecuador that the company dumped at least 15 billion gallons of toxic oil waste into streams and rivers in Ecuador relied on by indigenous groups for their drinking water, bathing, and fishing. Multiple health evaluations have found skyrocketing cancer rates in the affected area. A half-hearted Chevron remediation turned out to be a sham; even Chevron's own technical reports proved during the trial that its former well sites were contaminated with life-threatening toxins. (For a summary of the overwhelming evidence against Chevron see, here.)
Donziger and one of his Ecuadorian colleagues, Goldman Prize winner Pablo Fajardo, have been the primary targets of a Chevron smear campaign that involves at least six public relations firms. One of those firms, CRC Public Relations, is notorious for having executed the Swift Boat campaign attacking John Kerry's patriotism in the 2004 presidential campaign.
In his latest filing, Gupta accused Judge Kaplan of accepting the false testimony from disgraced former Ecuadorian trial judge Alberto Guerra as part of Chevron's strategy to exact revenge against the lawyers who helped the villagers win their historic judgment. (For the specific details of Guerra's false testimony, see this legal brief.)
Gupta demonstrates in his latest brief that Chevron's main allegation -- that lawyers for the villagers "ghostwrote" the trial judgment -- is irrefutably false.
Gupta points out that after being found guilty in Ecuador, Chevron looked for a way to blow up the judgment against it. It suddenly found a man (Guerra) who had been defrocked as a judge in Ecuador for accepting bribes. At the time, he was making $500 monthly but was willing to accuse Donziger (whom he had met briefly on two occasions) and Fajardo of orchestrating the "ghostwriting" of the 188-page trial court judgment in exchange for a princely fee.
Guerra struck a deal with Chevron to be paid $2 million in cash and benefits. He then told a story that the document that became the trial court judgment in Ecuador was given to the trial judge (Nicolas Zambrano) on a flash drive just days before it was issued.
Donziger, who has never received an ethics complaint in 23 years of law practice and who had never even met or seen the trial judge who wrote the judgment, always claimed that testimony was a lie. But how do you prove a negative?
Enter the new forensic report that became available only after Kaplan made his horrendously flawed findings of ghostwriting. Based on an examination of the hard drives of the office computer of the Ecuadorian trial judge, the report clearly demonstrates that the Word document that became the judgment was saved no fewer than 484 times on the computer of the trial judge in the four months before it was issued. So much for Guerra's flash drive story.
Gupta's brief explains how the new report, prepared by American computer expert J. Christopher Racich ("Racich report") for a related arbitration proceeding between Chevron and Ecuador's government, blows the lid off the oil major's defense.
Gupta nails Chevron for corrupting the court process:
"On this record, and even more so in light of the new forensic analysis not available to the district court, it is no exaggeration to say that Mr. Donziger was framed by Chevron on the basis of a paid witness who admitted to making false statements to sweeten his deal with Chevron."
For good measure, Gupta added that the Racich report proves "Guerra's story was a lie designed to net him a massive payout from Chevron." You would have to be obtuse not to figure that out even before the Racich report was disclosed.
But Kaplan, who called Donziger a "field general" and allowed Chevron to make a mockery of the rule of law in his courtroom, still credited Guerra's internally inconsistent and wholly unreliable testimony.
Chevron's exorbitant payments to Guerra were themselves an utterly indefensible act as federal law prohibits payments to fact witnesses. None other than distinguished Dean Erwin Chemerinsky has confirmed this in a sworn affidavit that Kaplan predictably ignored.
It gets worse. Before taking the stand, Chevron lawyers coached Guerra on what he would say for 53 consecutive days. Those engaged in this unprecedented witness "prep" for Chevron were Avi Weitzman, Andrea Neumann, Reed Brodsky and Randy Mastro. That group hails from a law firm (Gibson Dunn & Crutcher) that the High Court of England recently found falsified evidence in another case to try to frame a man who had become a threat to another of its high-profile clients.
Guerra has gotten rich off of Chevron. Among the other perks the oil giant provided for his testimony: immigration from Ecuador to the U.S. for several family members, health insurance, housing, a car, and a team of lawyers to help him secure political asylum. He lives in a secret location in the U.S. under Chevron's protection.
Donziger repeatedly has called Chevron's allegations a frame-up and criticized Judge Kaplan for making disparaging comments from the bench. (Kaplan referred to the affected communities as the "so-called" plaintiffs "said to reside" in the rainforest.) Donziger also exposed that Kaplan held undisclosed investments in Chevron during the trial, further un-endearing himself to a judge widely known for his bullying tendencies.
(For more detail on Kaplan's bias against Donziger and his clients, see this petition to remove him from the case.)
Donziger and a team of Ecuadorian lawyers secured the judgment against Chevron after eight years of hard-fought litigation where the oil giant repeatedly tied to corrupt and paralyze the proceedings. At one point, Chevron threatened the judge with jail time if he refused to grant a company motion to nullify the proceedings. At another point, the company filed 39 duplicative motions in 50 minutes to throw sand into the gears of the court. For part of the background on the company's corruption, see this affidavit from Ecuadorian lawyer Juan Pablo Saenz.
As if 105 technical evidentiary reports proving contamination was not enough evidence, just recently a Chevron whistleblower turned over internal company videos showing the oil giant's scientists laughing at the pollution at well sites in Ecuador that the company claimed to have remediated.
The judgment against Chevron was affirmed by two separate appellate courts in Ecuador, including by the country's Supreme Court in a unanimous 5-0 decision. The judgment was based almost completely on scientific evidence Chevron itself put before the court. The damages are relatively modest compared to the $30 billion paid out by BP for the far smaller Gulf of Mexico spill.
Even though Chevron insisted the the trial be held in Ecuador, as the evidence mounted the company quickly became a sore loser and announced it would never pay the judgment. In 2011, it sued Donziger and Fajardo in New York for roughly $60 billion -- thought to be the largest potential personal liability in U.S. history. Yet Chevron General Counsel R. Hewitt Pate had so little confidence in his own evidence that he dropped the entire damages claim on the eve of trial to avoid a jury of impartial fact finders.
Chevron's 32-year-old forensic expert Spencer Lynch -- who also examined the trial judge's hard drives -- had no answer for the Racich report. He has tried to claim flash drives were used in the judge's computer 56 times during the four-month period the judgment was written. But Racich showed that not a single one of those flash drives contained the judgment or any related documents. Most contained personal items such as family photos.
We might add that CEO John Watson had no answer to the Racich report either when confronted about it by Ecuadorian indigenous leader Humberto Piaguaje at the company's annual meeting last week. See here for how Watson continues to mislead his own shareholders about the Ecuador case.
The question now is whether the United States Court of Appeals for the Second Circuit can absorb this disturbing evidence and reverse a case where a federal judge so clearly relied on false evidence for his factual findings.
(For Donziger's view of the case, see this article in The Huffington Post and this article published on the legal website Law360.)