Attorney Steven Donziger’s long quest to wring a settlement from Chevron over oil pollution in the Ecuadorean jungle suffered a potentially fatal blow today after the environmental consultant he relied upon to obtain a $19 billion verdict there disavowed its work, saying the process was “fatally tainted.”
Stratus Consulting announced the settlement of a racketeering lawsuit Chevron brought against it today by walking away from its work for the plaintiffs in the Ecuador case. The Boulder, Colo. firm said the report by a supposedly independent expert for the court in Ecuador, Richard Stalin Cabrera Vega, is “not reliable.”
“Stratus disavows the Cabrera Report, has agreed to cooperate fully and to provide testimony about the Ecuador litigation,” the firm said.
Chevron has taken a no-holds-barred approach to the lawsuit, which Donziger claims to be on behalf of thousands of Ecuadorean villagers whose land was polluted by the Texaco’s drilling activities from the late 1960s until the company was ejected from the country in 1992. Texaco was subsequently bought by Chevron. Donziger originally sued in federal court in New York, but Chevron got the case moved to Ecuador, only to watch the government shift to the left and create an inhospitable environment for it there.
Chevron has spent millions of dollars collecting evidence to support its contention that the legal process in Ecuador was hopelessly corrupt so the plaintiffs won’t be able to collect on the judgment in other countries. Earlier this year, it obtained an affidavit from a former judge on the case claiming the plaintiffs offered a $500,000 bribe to the judge who decided the case.
Chevron maintains it obtained a release from litigation after performing cleanup operations in the late 1990s, and that whatever pollution is left in the jungle is the responsibility of Ecuador’s state-owned oil company, Petroecuador, which took over all operations in 1992 and has continued to pollute to this day. Donziger, in interviews with me, has never explained why he isn’t suing Petroecuador over the pollution, although he argues Petroecuador merely continued the bad practices that Texaco established.
A key allegation is that pits filled with oil residue and drilling fluids are leaking into groundwater and causing cancer in surrounding communities. Donziger, with generous funding from a succession of outside investors, hired Stratus to compile evidence of the pollution. Chevron claims much of that work found its way into Cabrera’s report even though Cabrera was supposed to be an independent expert working for the court. Chevron claims Cabrera was paid $100,000 under the table in addition to the $263,000 the plaintiffs paid the expert as their share of court costs.
Chevron named Stratus, along with Donziger, in a fraud and racketeering suit claiming the Ecuador litigation was an elaborate shakedown scheme. The settlement announced today removes Stratus from that litigation, and the wording of its statement reflects the intense pressure it was under from Chevron’s lawyers. In its statement, Stratus described “a process that Stratus has learned was tainted by Donziger and the Lago Agrio plaintiffs representatives’ `behind the scenes activities.’”
“Stratus deeply regrets its involvement in the Ecuador litigation. We are delighted to have this matter behind us.”
By Daniel Fisher-Forbes, April 11, 2013