The dawn of 2015 has proved to be a busy period in the Great Chevron Shakedown case. Having already beaten the Ecuadorian officials who began it and the environmental activists in the United States who supported it, Chevron went after New York attorney Steven Donziger. That unfortunate soul was eventually found liable for RICO violations, but the action hasn’t stopped yet. Now one of the “investors” who backed the cost of the extensive, fraudulent attempt to pick the energy giant’s pockets in exchange for a cut of the proceeds has had to settle in court, abandoning his long time friend Donziger and admitting that he had been “misled” into a fraudulent exercise.
Chevron Corporation has reached a settlement agreement with James Russell DeLeon, the principal funder of the fraudulent lawsuit against Chevron in Ecuador. Chevron brought claims against DeLeon in Gibraltar, where DeLeon maintains a residence, for his role in funding and advancing the fraudulent lawsuit. In the settlement, DeLeon has resolved those claims by withdrawing financial support from the Ecuador litigation and assigning his interests in the litigation to Chevron. Chevron, in turn, has agreed to release all claims against DeLeon. In filings with the Gibraltar court, DeLeon previously disclosed having invested approximately $23 million in the case in exchange for an approximate 7 percent stake in the $9.5 billion Ecuadorian judgment against Chevron. DeLeon’s funding entity, Torvia Limited, and his associate, Julian Jarvis, are also parties to the settlement.
“We are pleased that yet another long-time supporter has ended his association with this scheme,” said R. Hewitt Pate, Chevron’s vice president and general counsel. “Chevron will continue to hold accountable those who associate themselves with this fraudulent litigation.”
DeLeon doesn’t have to cut a big check to Chevron, but the losses he is swallowing are probably more than punishment enough. As noted above, he’s sunk more than 23 million into the shakedown and not seen a dime in return. He was also convinced to provide an undisclosed amount of money to fund a “documentary” on Chevron’s activities in Ecuador directed by Joe Berlinger. To add insult to injury, DeLeon had to sign off on the following public admission.
“Commencing in March 2007, I provided funding to support the litigation in Ecuador against Chevron Corporation, in the good faith belief that I was supporting a worthy cause.
However, I have since reviewed the March 4, 2014 opinion by Judge Kaplan of the United States District Court for the Southern District of New York setting out the Court’s findings and I have also considered the evidence presented during the trial. As a result, I have concluded that representatives of the Lago Agrio plaintiffs, including Steven Donziger, misled me about important facts. If I had known these facts, I would not have funded the litigation.
DeLeon has also signed over any and all interest he had in the suit to Chevron. He wasn’t the first, by the way. Another such “investor” outfit, the Burford Group, renounced their association with Donziger in 2011 and similarly had to abandon their claim.
At this point it seems unlikely that Chevron is going to see any financial benefit from going after these folks, but I’m guessing that’s not really the point. It has been extremely common for grifters and “activists” to bring nuisance suits against large companies with deep pockets in the hopes that the companies would settle quickly just to avoid a prolonged court battle. Far too often it has worked. It’s just possible that by chasing every last one of the culprits out of the shadows all across the globe, Chevron may be striking a blow here and setting a precedent which will discourage such attempts at extortion in the future.
You can view a history of Hot Air’s coverage of this case dating back several years with this index.