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Reuters – Arbitrators near jurisdiction call in Chevron case

Date: Nov 28, 2011

In an arbitration Chevron initiated in 2009 under the U.S.-Ecuador Bilateral Investment Treaty (BIT), a Tribunal in The Hague issued an order in February 2011 requiring Ecuador to take all measures at its disposal to prevent enforcement of the Lago Agrio judgment until further order of the Tribunal, including the Tribunal’s final award on the merits:

Arbitrators expect to rule as early as next month on whether they can hear a dispute between Chevron Corp and Ecuador related to a marathon pollution liability case, according to a letter to the lawyers involved.

The tribunal, working under The Hague’s Permanent Court of Arbitration (PCA), ordered the Republic of Ecuador in February to suspend enforcement of any judgment in the lawsuit filed by rainforest dwellers against Chevron.

Chevron lost that case a few days later, as the company had expected. A New York judge then sought to freeze the $18 billion judgment against the second-largest U.S. oil company, before he was overruled on appeal.

Chevron, arguing the judicial process in Ecuador was corrupted, is now banking on the arbitrators, who must first decide whether they will become the latest body to weigh in on what has become a landmark international legal battle.

“The current expectation is that the decision will be issued in the course of late December 2011 or early January 2012,” Martin Doe of the PCA wrote in a Nov. 11 letter, which wound up in the filings of related U.S. lawsuits.

“If that goes our way, we can begin arguments on the merits,” a Chevron spokesman said on Monday.

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