Politics, Business & Culture in the Americas

No End in Sight for Ecuador vs. Chevron

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After 17 long years in a legal battle, Ecuadorian farmers and environmentalists rejoiced this week when an Ecuadorian judge ruled that Chevron Corporation (Texaco merged with Chevron in 2001) was guilty of polluting the Amazon jungle. The judge ordered Chevron to pay a $8.6 billion fine and an equal amount in punitive damages. If Chevron does not publically apologize within 15 days, the company would be ordered to pay twice the amount. But the battle is far from over.

Ecuadorian farmers in the Amazon accused Chevron of dumping billions of gallons of toxic waste into the Amazon River basin between 1972 and 1992.  Farmers reported higher cancer rates, polluted water supplies and subsequent damage to crops and farm animals. Plaintiffs say $8.6 billion is not nearly enough and were hoping for at least $27 billion. With the hope to receive more money, the 30,000 Ecuadoreans represented in the lawsuit announced that they will appeal the settlement amount. 

Chevron on the other hand, is vowing to fight the lawsuit and in a public statement called the ruling “illegitimate and unenforceable.” It denies that any health problems in the region are its fault and points out that it has already spent $40 million in clean up throughout the 1990s. The company signed an agreement with the Ecuadorean government in 1998 absolving it of any further responsibility and claims that it is the government’s fault for not keeping up with its own environmental standards. Petroecuador, the state-run oil company has been responsible for the oilfields in question for the last 20 years, according to Chevron’s spokesman Kent Robertson in an interview with the BBC. In that same interview, Robertson also stated that “Petroecuador has a deplorable environmental record and Chevron is getting blamed for actions in a country that we’ve never even operated in.”

Chevron has also taken additional steps to fight the lawsuit and took the case to the Permanent Court of Arbitration in The Hague, which ordered Ecuador to “to take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment.” Chevron also filed a separate case in the United States that accuses the claimants and their lawyers of racketeering, tampering with witnesses and obstructing justice—the company claims that lawyers for the plaintiffs were “leading a fraudulent litigation and PR campaign against the company.” Furthermore, as the ruling is likely unenforceable as the company does not have oil refineries or any other properties in Ecuador that the government could seize to pressure the company to pay for damages, Chevron went to court in New York last week to obtain an order temporarily shielding it anywhere in the world from collection efforts related to the case.

The case, formally known as Maria Aguinda v Chevron, 002-2003, will not likely see a conclusion in the foreseeable future with both sides vowing to appeal the recent ruling.

Melissa Pitts is a guest blogger for AQ Online. She is a contributing writer for Americas Quarterly.

Tags: Chevron, Ecuador, Environment, Globalization and Latin America, land and water use
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