The Corrupt Ecuadorian Lawsuit Against Chevron
On Sept. 30, 1998, Petroecuador and the government of Ecuador officially discharged and released TexPet from all claims and liabilities associated with the concession. Despite this broad release, in 2003 U.S. plaintiffs’ lawyers arranged to file, a lawsuit was filed in Lago Agrio, Ecuador, against Chevron, which, as a result of a merger of a Chevron subsidiary with Texaco in 2001, had become the ultimate indirect parent company of TexPet. The lawsuit claimed Chevron was responsible for alleged environmental and health impacts because of TexPet’s operations.
Chevron, however, observed irregularities in the conduct of the Ecuadorian lawsuit, and then worked to uncover them by means of actions in both the U.S. and in Ecuador. The investigation exposed how Richard Cabrera, who was hired by the Ecuadorian court to conduct a study of the alleged environmental damage, produced a wholly illegitimate and unsubstantiated damage and penalty recommendation against Chevron.
While the plaintiffs, led by New York attorney Steven Donziger, insisted the “Cabrera Report” was independently conducted, ample evidence showed otherwise. Cabrera, a mining engineer with no background in hydrocarbon impact on the environment, was paid $200,000 by the plaintiffs to produce the “Cabrera Report.” Major portions of the report were copied from the plaintiff’s own submissions, if not written by them directly. Chevron representatives were denied access to Cabrera’s fieldwork, which was found to be filled with errors.
Chevron has responded to multiple claims regarding environmental liability despite TexPet’s six-year-effort to conduct an orderly exit from the Ecuadorian consortium, despite conducting a $40 million remediation overseen by the Ecuadorian government, and despite receiving a release of all liability from Ecuador. For each of the environmental claims, as outlined below, the scientific evidence clearly shows that the assertions of harm in Ecuador made by the plaintiffs’ lawyers and their supporters are false.
False Cancer Claims
The 2003 lawsuit claimed that “[t]he mortality rate in the communities exposed to oil contamination is higher than the national average. The incidence of cancer is three times higher than the national average and five times higher than the average of the Amazon provinces.” The source for these figures was not given, and the claim turned out to be false. During the trial, the plaintiffs’ lawyer admitted privately “we DO NOT have medical records” to substantiate their cancer claims. Nevertheless, based on a survey they conducted of people who self-reported cancer, they falsely claimed 1,401 “excess cancer deaths” due to TexPet’s operations. Their own epidemiologist said their approach “has little validity,” and their “calculation of the excess of [cancer] cases is incorrect.” This false number has been repeated in the press even after the person who originally reported the number, Douglas Beltman of Stratus Consulting, admitted it had no scientific merit.
Chevron asked epidemiologists to evaluate the Ecuadorian government’s cancer statistics to determine whether the cancer mortality rate was higher in oil-producing counties than in the rest of the country. Using figures published by the Ecuadorian census, a 2008 study of cancer mortality concluded: “Using regional oil well density as a surrogate for exposure, there were no significant elevations in cancer rates in cantons [counties] with a high density of wells relative to those with a low or zero density.” A second epidemiological study was performed and published in 2013, and its author, Dr. Moolgavkar, found that “the available epidemiologic evidence does not support a statistical association, let alone a causal relationship, of adverse human health outcomes with environmental exposure to petroleum from oil exploration and production activities.”
Indigenous People
The 2003 lawsuit claims that TexPet’s operations were “especially devastating for five indigenous groups,” the Cofan, Siona, Secoya, Huaorani, and Kichwa. That claim was expanded on by Donziger, who falsely claimed that “one group, the Cofan, has seen its population drop from 15,000 in 1970 to approximately 800 today.”
To evaluate these claims, Chevron asked anthropologist Robert Wasserstrom to research the indigenous groups in the Ecuadorian Amazon. What he found (here, here, here) is that, in the 1960s, before TexPet began operating in Ecuador, the first systematic count of the Cofan people put their population at 580 individuals, not 15,000. In 2000, after TexPet left Ecuador, the first Ecuadorian census to specifically count indigenous people by ethnicity reported 1,044 Cofan, a near-doubling of the Cofan population.According to Ecuador’s census and multiple independent sources, the population of all five of the indigenous groups has increased since TexPet began operations in Ecuador.
Deforestation
The 2003 lawsuit claimed TexPet operations resulted in massive deforestation in the former concession area. Scientists and other experts investigating this claim concluded otherwise (here, here). They found that deforestation in this part of the Amazon was a direct result of the government of Ecuador’s settlement and agriculture policies, not TexPet operations. The government seized on the discovery of oil to accelerate a long-standing national security and development dream of “colonizing” its Amazon region. It ordered the consortium to build public access roads, relocated thousands of impoverished farmers and their families to “unoccupied” lands in the area, and required those colonists to clear-cut the forest and create pastureland in efforts to expand agriculture across the country’s northeastern rainforest.
Ecosystem Damages
Donziger and his team have claimed that TexPet’s operations in Ecuador resulted in an “Amazon Chernobyl.” To investigate these claims, Chevron retained biologists in 2008 to evaluate the impact of oil operations on biological diversity. A study comparing forested areas near a former TexPet well and forested areas with no wells found no significant ecological differences. The authors concluded that a history of petroleum development, by itself, does not affect abundance and diversity of biological resources in this area. Other experts conducted ecological surveys of streams and sediments at well sites to evaluate any ecological impacts from petroleum and metals to those areas.
Health Risk Assessment
As part of the 2003 lawsuit, the plaintiffs claimed that residents around the former oil operations were drinking contaminated water and exposed to contaminated soil from TexPet operations. An international team of experts in remediation, sampling, water resources, and risk assessment addressed these claims during the Lago Agrio trial. Surface water samples were collected at 175 sampling points and 173 met World Health Organization (WHO) and U.S. Environmental Protection Agency (USEPA) drinking water limits for petroleum and metals. The only two sample points that were exceptions were sites where Petroecuador had a major ongoing leak or spill.
Similarly, drinking water samples were collected from 221 drinking water sources and 220 met WHO and USEPA drinking water limits for petroleum and metals. Those same studies (here, here) found that 79 percent of the drinking water samples contained E. coli (fecal coliforms), indicating a lack of proper sewage treatment and lack of chlorination for well water. No groundwater contamination due to petroleum was detected.
During the trial, court-appointed experts sampled 47 pits remediated by TexPet. Those samples showed that 46 of the 47 complied with the soil remediation criteria applicable at the time of the cleanup. The remaining pit had been previously tested in 1997, at the time of remediation. The sampling indicated that the remediated pit met the required soil-cleanup criteria.
These same results were found time and time again by the Lago Agrio plaintiffs’ experts. Their first set of experts, Charles Calmbacher and David Russell, (here, here) found that there was “no evidence of any widespread health effects caused by oil contamination from Texaco, and no evidence of drinking water contaminated with petroleum from Texaco’s operations.” Plaintiffs’ second set of experts reached the same conclusion. Douglas Beltman, formerly of Stratus Consulting, testified that “none of the drinking water samples I have seen exceeded the drinking water guidelines or standards established by WHO and the U.S. EPA for any chemical compound related to oil operations, let alone exclusively TexPet operations.”
Almost 1,300 soil, sediment, and water samples were collected during the trial. The results from the water and soil analysis were used to conduct a quantitative risk assessment that showed that there were no health risks due to TexPet’s operations. The methodology used was consistent with standard risk assessment processes used in the U.S. and Europe.
Conclusions
In 2011, the Lago Agrio court found Chevron liable for $18 billion for remediation and punitive damages, later reduced to $9.5 billion by Ecuador’s National Court of Justice. In March 2014, the U.S. District Court for the Southern District of New York found that the Ecuadorian judgment was the product of fraud and racketeering directed by now-disbarred lead plaintiffs’ lawyer Donziger, finding it unenforceable in the United States.
Despite overwhelming evidence of fraud, bribery, ghostwriting, extortion, and collusion in securing the Lago Agrio judgment, Donziger, his followers and some Ecuadorian and U.S. activists and politicians continue to promote his false claims.
