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Donziger Must Pay $814K in RICO Fees to Chevron, Court Says

Date: Mar 7, 2018

The cost of fraud just went up for Steven Donziger.

A U.S. federal court in New York has ordered Donziger, mastermind of the Ecuadorian racketeering and fraud scheme against Chevron Corp., to pay the company $813,603 for his share of court fees from his 2013 RICO trial.

In a 49-page opinion last week, U.S. District Court Judge Lewis A. Kaplan, who presided over the RICO proceeding, reiterated that “Donziger and his co-conspirators attempted to extort billions of dollars from Chevron” through falsified evidence, bribery, coercion and the ghostwriting of a $19 billion court judgment against the company in Ecuador. The RICO ruling, which was unanimously affirmed by the U.S. Court of Appeals, granted Chevron the right to recover the costs of the action.

Last Wednesday, the court rejected all Donziger’s arguments for not paying as baseless or unsupported by evidence, adding he was not entitled to favorable court “discretion” due to his “repeated” and “egregious misconduct” and “outrageous behavior” throughout the case.

“Among other things, he willfully, deliberately disregarded a court order to produce relevant documents located in Ecuador but nonetheless under his practical control,” the judge wrote. “He deliberately testified falsely at an evidentiary hearing on Chevron’s motion for sanctions. And he falsely testified that he lacked recollection in response to nearly 300 questions at his deposition in this case and on cross-examination at trial.”

The court also rejected Donziger’s attempt to re-litigate parts of the RICO trial, particularly testimony against him by former Ecuadorian judge Alberto Guerra, who corroborated that the judgment was procured through fraud. Chevron’s contacts with Guerra, who was relocated to the U.S. for his safety, were proper and transparent, the court said.

“[T]here was abundant evidence, which the Court credits, that Guerra’s decision to cooperate with Chevron and, ultimately, to testify in this case would have exposed him and his family to serious risks to personal safety and security had they remained in Ecuador,” Kaplan said, adding: “Chevron even disclosed the facts concerning its interactions with Guerra to the U.S. Department of Justice long before calling Guerra at trial. No more need be said.”

Moreover, the court held that Guerra’s testimony was not essential to the RICO ruling, which found that Donziger and his team in Ecuador:

  • Blackmailed a judge to abandon judicial inspections and appoint a “global expert;”
  • Corrupted the “expert,” Richard Cabrera;
  • Wrote Cabrera’s report;
  • Falsely passed off Cabrera’s report as the work of an independent, impartial expert;
  • Ghostwrote former Judge Nicolas Zambrano’s $19 billion judgment “which demonstrably relied on the fraudulent Cabrera report.”

“[T]he testimony of Guerra was far from indispensable to the judgment rendered in this case,” the judge wrote. “As the court’s opinion makes clear, this Court would have reached precisely the same result in this case without the testimony of Alberto Guerra.”

In establishing Donziger must pay 85 percent of the Special Master’s fees, the court touch on numerous aspects of the Ecuador fraud and RICO trial:

On Donziger’s behavior during deposition and pre-trial discovery: “Donziger’s obstructive conduct ‘continued unabated during discovery’ and ‘unnecessarily increased the costs of the proceedings.’” And, “Donziger’s refusal to produce documents that were in his practical control accords with the Special Masters’ assessment of his behavior: he was ‘trying to prevent the basic facts coming to light.’”

On Donziger’s claims of inability to pay: “Donziger repeatedly has refused to provide much information concerning his personal financial situation.” However, “it came out at trial that Donziger received cash and real estate worth $1.8 million and $1.9 million from ‘family estate related matters’ during the two years prior to the trial. … Other evidence showed that Donziger personally received somewhere between $958,000 and $1.3 million from litigation funders before trial, and the figure could well have been higher because the records from which that information was gleaned were incomplete.”  Even though Donziger “raised at least $21.4 million” in funding for the litigation, “a large portion of [these funds] has never been accounted for” as “the available records showed . . . only $16 million.”

On environmental conditions in Ecuador: “[C]ertainly the fraudulent Ecuadorian judgment cannot be taken as having established anything.”

On the finality of RICO: “Insofar as Donziger is concerned, the case is over save for the matters of costs and attorney fees.”