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2014: A Very Bad Year for Fraud

Date: Dec 17, 2014

2014 was a critical year in the undoing of the fraudulent case against Chevron in Ecuador.

The year saw a momentous verdict in the RICO case against Steven Donziger and his allies, the withdrawal of a leading law firm, a continued intimidation campaign by Donziger and his team and evidence of phony PR campaigns funded by the government of Ecuador.

Here is a look back at 2014:

U.S. Court Finds Ecuador Judgment Fraudulent, Unenforceable

The year began with a major decision by the U.S. District Court for the Southern District of New York. In March, the court issued a 500-page ruling concluding that the judgment against Chevron in Ecuador was procured through “egregious fraud” by Steven Donziger and his associates. The court also found that the Ecuadorian judgment was unenforceable in the United States. Some of the examples of fraud the court cited in its ruling include testimony from a former Ecuadorian judge who admitted to orchestrating the fraudulent judgment, testimony from a U.S.-based consulting firm that admitted to ghostwriting reports for a court appointee, and testimony from Donziger’s own scientific expert who confirmed environmental evidence was fabricated. This testimony was so strong that in his ruling, Judge Lewis Kaplan wrote: “The wrongful actions of Donziger and his Ecuadorian legal team would be offensive to the laws of any nation that aspires to the rule of law, including Ecuador – and they knew it.”

Patton Boggs Withdraws Support from Fraudulent Lawsuit

In March, Judge Kaplan granted Chevron’s request to bring counterclaims against Patton Boggs, a lobbying and law firm headquartered in Washington, D.C., to hold it accountable for its role in supporting and advancing the fraudulent Ecuadorian lawsuit.

On May 7, Chevron reached a settlement with Patton Boggs. In it, the firm agreed to withdraw from the litigation, issued a statement of regret, and assigned its interests in the litigation to Chevron. Patton Boggs also made a payment of $15 million to Chevron. In turn, Chevron dropped its claims against the firm and its partners. In its statement, Patton Boggs said, “Based on the Court’s findings, Patton Boggs regrets its involvement in this matter.”

Holding Fraud Funders Accountable

In March, the Supreme Court of Gibraltar ruled that Chevron can pursue claims against Russ DeLeon, one of the main funders of the fraudulent Ecuadorian lawsuit. DeLeon was a Harvard classmate of Steven Donziger and began funding the fraudulent lawsuit in 2006. He also provided a majority of the funding for the anti-Chevron “documentary”, Crude. According to DeLeon’s own court filings, he has contributed nearly $23 million to the case, with a 7% stake in the judgment in return.

Chevron also filed claims in Gibraltar against U.K.-based litigation funder, Woodsford, who has also provided substantial funding to the fraudulent scheme.

Ecuador’s Paid Protestors Uncovered

Despite fraud findings by the U.S. court, Donziger, his team, and the Republic of Ecuador continued their shameless PR campaign against Chevron. It started with fake anti-Chevron protestors and a manufactured, AstroTurf Twitter campaign.

On May 21, activist groups like Amazon Watch joined with Ecuadorian leaders and protestors in New York City to mark “International Anti-Chevron Day.” However, evidence revealed that the “protesters” were actually hired by a New York City-based casting company and paid $80/hour. Fake protestors were also hired to chant outside of Chevron’s Annual Stockholder Meeting in Midland, TX, on May 28.

In July, the fake protestors moved from the street to Twitter. Evidence emerged that anti-Chevron Tweets were being produced by people paid to promote anti-Chevron slogans and hashtags.

“Journalistic Malpractice” Exposed

In August, Rolling Stone published a 5,000-word piece on the Ecuador litigation, without mentioning any of the key facts, including much of the evidence of bribery, fraud, and extortion. It also conveniently left out, among other things, the 600 hours of Crude outtakes, the evidence of bribery in the Ecuadorian court system, and the myriad of testimony heard against Donziger in the Southern District of New York.

But the Rolling Stone piece wasn’t the first time Donziger attempted to use the media to spread his fabricated smears against Chevron.

In September, emails between Donziger and Vanity Fair reporter, William Langewiesche, were revealed in a column by Glenn Garvin in The Miami Herald titled, “When Journalism is Too Good to be True.” As Garvin noted in his column:

“The emails between Donziger and Langewiesche in early 2007, as the story was being prepared, show Langewiesche as Donziger’s camp follower at the best of times, his sock-puppet at the worst. The reporter asks Donziger to prepare lists of dozens of questions to be asked of Chevron. And he begs Donziger to help him prepare arguments about why there’s no need for him to do face-to-face interviews with Chevron officials, as they’ve requested, even though he spent days meeting with Donziger and his legal staff.

The collusion between Donziger and Langewiesche was labeled “journalistic malpractice” by some media observers.

Ecuador Pays Celebrities Big Bucks to Support the Fraud

Also in September, more evidence came to light to expose a well-funded P.R. campaign by the Republic of Ecuador against Chevron. It was revealed that Ecuador hired a Brooklyn-based firm, MCSquared, for $6.4 million, for public relations work in United States. With close ties to the government of Ecuador, MCSquared staged several anti-Chevron publicity stunts, including paying celebrities to endorse an anti-Chevron campaign. It was revealed by the Washington Free Beacon that both Mia Farrow and Danny Glover – who traveled to Ecuador last year to criticize Chevron – were actually paid thousands of dollars by MCSquared.

Human Rights Leaders, Legal Scholars and Women’s Rights Advocates Support Chevron

In October, a broad and diverse collection of organizations and legal experts filed Amicus briefs in support of Chevron’s arguments in the Chevron vs. Donziger appeal.  The Amici included a leading women’s rights legal organization, a group of human rights experts, one of the authors of the original RICO act, Latin American legal scholars, business groups and the Washington Legal Foundation.

A brief submitted by international legal experts, whose careers have been devoted in large part to the protection of human rights or to efforts to combat public corruption, argued that Donziger cannot claim that his advocacy for human rights justifies his corrupt misconduct.  They argue that if the District Court’s findings of fact are true, then Donziger has damaged the cause of human rights. They noted:

“Advocates for human rights do not advance human rights by violating them, and the corrupt pattern of fraud, extortion, and bribery described by the District Court, if accurate, denies the fundamental human rights to due process of law and a fair trial.

Donziger Resorts to Pressure, Humiliation and Intimidation to Silence Critics

Unable to refute the evidence of fraud against them, Donziger and his team resorted to personal and professional attacks against anyone who spoke out against their actions this year. They embarked on an international smear campaign against journalists, judges, human rights experts, women’s rights groups, and anyone else who spoke the truth about the case.

Joe Nocera, of the New York Times, described Donziger’s tactics saying, “With every critic, Donziger and his allies have replied in the same way: The critics have been corrupted by the evil Chevron.”

Roger Parloff, a respected legal reporter for Fortune, who became a target of Donziger’s team, highlighted the attacks in a review of two books on the case released this year by Paul Barrett, of Businessweek, and Michael Goldhaber, of American Lawyer. In his piece, “2 Books and a Smear Campaign”, Parloff stated:

“In fact, both Goldhaber and Barrett deserve commendation for ever having enlisted for the project of writing about this case. It had to have been clear from the outset that anyone who did so conscientiously—a task that would necessarily include discussing the overwhelming evidence of Donziger’s use of mendacity and intimidation to achieve his goals—would end up being tarred with baseless attacks on their integrity emanating from Donziger’s camp. (A Google search of my own name—for I, too, have been writing about this case for the past four years—usually turns up at least two of these retaliatory, search-optimized, diatribes.)”

In short, 2014 was a very bad year for Steven Donziger, his associates and the Republic of Ecuador, who continue to promote a fraudulent scheme – and a very good year for the truth and justice.