Surprise! Ecuador Rules Chevron Owes Ecuador Tons of Money

As Hot Air reported back in January, an extremely questionable court case was brought by an Ecuadorian “environmental group” against Texaco (now owned by Chevron) which had raised far more questions about the ethics of the case than the supposed damages being claimed. (Running into the billions of dollars.) On Monday that case came to a rather predictable conclusion in a court in Lago Agrio, Ecuador.


SAN RAMON, Calif. – Feb. 14, 2011 – Chevron Corporation (NYSE: CVX) today announced there has been an adverse judgment from the Provincial Court of Justice of Sucumbíos in Lago Agrio, Ecuador in an environmental lawsuit involving Texaco Petroleum Company.

In response to the ruling, Chevron issued the following statement:

“The Ecuadorian court’s judgment is illegitimate and unenforceable. It is the product of fraud and is contrary to the legitimate scientific evidence. Chevron will appeal this decision in Ecuador and intends to see that justice prevails.

The exact figures being awarded are still in flux. However, other courts have been busy weighing in on the matter over the past week barring the plaintiffs from picking anything from Chevron’s pockets just yet. The first was from The Hague.

Permanent Court of Arbitration Bars Enforcement of Judgment Against Chevron in Ecuador Lawsuit

On February 9, 2011, an international panel of arbitrators presiding in the Permanent Court of Arbitration in The Hague ordered the Republic of Ecuador to “take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment” against Chevron in the Lago Agrio case pending further order or award from the international tribunal.


The second came out of the Big Apple.

New York Judge Issues Restraining Order Against RICO Defendants

On February 8, 2011, Judge Lewis Kaplan of the Southern District of New York issued a temporary restraining order against the RICO defendants. The temporary restraining order blocks RICO defendants “from receiving benefit from, directly or indirectly, any action, or proceeding for recognition or enforcement of any judgment entered against Chevron in Ecuador.” The order also precludes “prejudgment seizure or attachment of assets based on any such judgment.”

Initial estimates as reported by the Wall Street Journal, however, make it look like the awarded damages could be as much as $8 billion, far in excess of what was originally requested. Why? A Chevron representative contacted Hot Air, reminding us of a few choice quotes discovered from the previously reported outtakes from the movie Crude, made by plaintiffs’ lead U.S. attorney Steven Donziger:

“If we have a legitimate fifty billion dollar damages claim, and they end up—the judge says, well, I can’t give them less than five billion . . . . And, say, Tex had a huge victory. They knocked out ninety percent of the damages claim.”

But as a concept, I ask, do we ask for much more than we really want as a strategy? Do we ask for eight and expect three, so that [the judge] says, ‘Look, Texaco, I cut down the largest part.’”


With the restraining orders in place, we should see a fair amount of breathing room for the rest of the shenanigans taking place in Ecuador to come to light before the American company has to pony up any cash. More details are expected in the next 48 hours and we’ll keep you updated on it.

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Jazz Shaw 8:31 AM on December 09, 2023