Energy

The Chevron Oil Pollution Case and the Limits of the U.S. Courts


Donziger

Photograph by Fred Conrad/The New York Times via Redux

Donziger

A new Kindle (AMZN) e-book uses the Chevron (CVX) oil pollution case in Ecuador to raise important questions about the reach of U.S. courts in human rights cases. Michael Goldhaber, “The Global Lawyer” columnist for The American Lawyer, argues that the U.S. judiciary should view its jurisdiction expansively when asked to right alleged corporate wrongs perpetrated in distant lands.

Goldhaber possesses an optimism I don’t share about judicial competence to untangle complicated international social and economic conflicts. Still, his well-written essay, Crude Awakening, deserves the attention of lawyers, legal scholars, and anyone interested in human-rights litigation.

Before going further, it’s a pleasure to disclose that Goldhaber is a friend and respected professional rival. Be aware, as well, of the imminent publication of my own book, Law of the Jungle, a more comprehensive look at the Chevron case and how a high-minded campaign to save the rain forest and its inhabitants went horribly awry.

The question in the Chevron case is who’s responsible for oil contamination in the Ecuadorian jungle that dates back to the early 1970s. A New York plaintiffs’ attorney named Steven Donziger has led a two-decade legal-and-media assault that culminated in a $19 billion judgment imposed by an Ecuadorian court against Chevron. The oil company counterattacked in federal court in New York, claiming that Donziger’s crusade devolved into an extortion racket. In March, a U.S. district judge found Donziger liable under American racketeering law and ordered that he and his clients ought not to profit from their fraudulent tactics. Donziger has denied wrongdoing and appealed. Chevron vows to fight forever—if that’s what it takes—to prevent Donziger from collecting on the Ecuadorian verdict.

Goldhaber illustrates the hypocrisy that has animated this fight from the outset. At first, the plaintiffs sued in New York, insisting that only American courts could offer them justice because the Ecuadorian judiciary was weak and corrupt. The oil company argued that Ecuador’s judges were able and principled. After U.S. courts dismissed the case, each side flipped its position. Chevron condemned the Ecuadorian courts, while Donziger lauded them as bastions of justice. After losing in Ecuador, Chevron brought the fight back to the United States, where Donziger has vilified the American judiciary (once his supposed friend) for sticking its nose where it shouldn’t.

Goldhaber’s take:

U.S. courts should never have set this warped experiment in motion. [U.S.] Judge Jed Rakoff committed the original blunder in 2001, when he ruled that the case belonged in Ecuador under the doctrine of forum non conveniens. It was naive for Rakoff to expect a politicized provincial court with a history of corruption to gracefully handle a massive dispute involving the three hot-button issues of gringos, greens, and indigenous politics.

I’m less quick to criticize Rakoff’s determination that courts closer to the alleged wrongdoing and evidence were better positioned to preside over the Chevron case. Indeed, I’m more skeptical than Goldhaber that any judicial process could have adequately addressed the side effects of industrialization of the rain forest—a challenge that cried out for political action and compromise, not lawyerly hairsplitting.

Where Goldhaber and I agree is that the ends-justify-the-means strategy embraced by Donziger and his allies undermined the rule of law and set a precedent that will impede future attempts to vindicate human rights via the courts.

Barrett_190
Barrett is an assistant managing editor and senior writer at Bloomberg Businessweek. His new book, Law of the Jungle, tells the story of the Chevron oil pollution case in Ecuador.

China's Killer Profits
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • AMZN
    (Amazon.com Inc)
    • $298.88 USD
    • 3.82
    • 1.28%
  • CVX
    (Chevron Corp)
    • $106.02 USD
    • 4.32
    • 4.07%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus