U.S. District Judge Lewis Kaplan on Tuesday issued a voluminous opinion regarding Chevron Corp.’sCVX +0.64% claims against New York lawyer Steven Donziger and his litigation team, saying a record $9.5 billion environmental judgment in Ecuador against the oil giant was “obtained by corrupt means.”
Judge Kaplan found that Mr. Donziger and his litigation team engaged in coercion, bribery, money laundering and other criminal conduct in pursuit of the 2011 verdict, and barred Mr. Donziger and his two Ecuadorean co-defendants from profiting from the verdict.
For the fuller take, click here for Jennifer Smith’s WSJ story.
For now, some highlights from the 485-page tome:
Page 2: Upon consideration of all of the evidence, including the credibility of the witnesses . . . the Court finds that Donziger began his involvement in this controversy with a desire to improve conditions in the area in which his Ecuadorian clients live. . . . In the end, however, he and the Ecuadorian lawyers he led corrupted the Lago Agrio case. They submitted fraudulent evidence. They coerced one judge, first to use a court-appointed, supposedly impartial, “global expert” to make an overall damages assessment and, then, to appoint to that important role a man whom Donziger hand-picked and paid to “totally play ball” with the [Ecuadorian plaintiffs]. They then paid a Colorado consulting firm secretly to write all or most of the global expert’s report, falsely presented the report as the work of the court-appointed and supposedly impartial expert, and told half-truths or worse to U.S. courts in attempts to prevent exposure of that and other wrongdoing. . . . If ever there were a case warranting equitable relief with respect to a judgment procured by fraud, this is it.
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Page 4: The issue here is not what happened in the Orienté more than twenty years ago and who, if anyone, now is responsible for any wrongs then done. It instead is whether a court decision was procured by corrupt means, regardless of whether the cause was just. An innocent defendant is no more entitled to submit false evidence, to coopt and pay off a court-appointed expert, or to coerce or bribe a judge or jury than a guilty one. So even if Donziger and his clients had a just cause – and the Court expresses no opinion on that – they were not entitled to corrupt the process to achieve their goal.
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Page 260: Donziger’s self interest extends beyond money. As he confided to his personal notebook on April 4, 2007:
. . . I sit back and dream. I cannot believe what we have accomplished. Important people interested in us. A new paradigm of not only a case, but how to do a case. Chevron wanting to settle. Billions of dollars on the table. A movie, a possible book.I cannot keep up with it all.
Thus, Donziger wants money, but he wants more as well. These desires have been important motivating factors.
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Pages 362-63: It was Donziger’s purpose to magnify the pressure on Chevron by increasing both the perceived magnitude of its potential exposure and the perceived likelihood that the exposure in the end would culminate in huge liability. He repeatedly did so by manifestly wrongful means, which included corruption of the litigation and a pressure campaign premised on misrepresentations.
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Page 366: As amply detailed above, Donziger’s actions in increasing the pressure on Chevron by dishonest and corrupt steps in the litigation – coercion, bribery, ghostwriting, and so on – were intended to communicate threats to Chevron. Their purpose was to instill fear of a catastrophic outcome in order to increase the amount Chevron would pay to avoid the worst.
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Pages 370-71: Evocation of the Exxon Valdez disaster was another such weapon. Donziger’s allegiance to the hyperbolic and highly misleading comparison between the contamination in the Orienté and the oil spilled by the Exxon Valdez further demonstrates Donziger’s willingness to disregard the truth in order to inflate Chevron’s perceived exposure. Despite repeated warnings from the LAPs’ own scientific experts about the inaccuracy of the comparison, ADF press releases and other materials continued to maintain that “[e]xperts for the plaintiffs have concluded the disaster is at least 30 times larger than the Exxon Valdez spill.” And they did so at Donziger’s direction.
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Page 376: Donziger knew that, “[i]n the US, threatening to file a criminal case to get an advantage in a civil case is considered a violation of ethical rules of the profession.” He nevertheless used the criminal prosecutions in an attempt to “keep the hammer over [Chevron’s] head” and to “force [Chevron] to the table.
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Page 381: Donziger’s overriding goal was to extract a large payment from Chevron in exchange for peace. In pursuit of that objective, however, he engaged, as we have seen, in a number of deceitful schemes, each of which was intended to play its part in achieving that end and each of which was furthered by use of the wires.
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Pages 402-403: Among the . . . acts that Chevron has proved are (1) multiple extortionate acts including, among others, (a) the ghostwriting of the Judgment and the promise of $500,000 to Zambrano for signing it, and (b) the ghostwriting of the Cabrera Report upon which the author(s) of the Judgment relied for the pit count that underlies more than $5 billion of the damages award, as well as the false portrayal of Cabrera as a neutral, impartial and independent expert, and the payments and other inducements to Cabrera to ensure that he “played ball,” (2) multiple acts of wire fraud in furtherance of fraudulent schemes with respect to all of the foregoing, (3) money laundering to promote racketeering acts, including with respect to the ghostwriting of the Cabrera Report by Stratus and payments to Cabrera, and (4) violations of the Travel Act to facilitate violations of the anti-bribery provision of the FCPA by payments to Cabrera. (Pages 402-403)
