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US Appeals Court Orders Ecuador to Pay $96 Million to Chevron

Aug. 4, 2015
The court thus upheld the previous decision of the D.C. federal court and validated the finding of a three-member tribunal based at The Hague.

NEW YORK - A U.S. federal appeals court on Tuesday upheld a $96 million award that Ecuador must pay oil giant Chevron (IW 500/2) in an arbitration of their dispute over Chevron's investments in the country.

Judge Robert Wilkins, of the U.S. Court of Appeals in the District of Columbia, concluded that by signing the investment treaty with the United States, which took effect in 1997, "Ecuador made a standing offer to American investors to arbitrate disputes involving investments that existed on or after the treaty's effective date."

The court thus upheld the previous decision of the D.C. federal court and validated the finding of a three-member tribunal based at The Hague.

The arbitration decision against Ecuador also had been ratified in the Netherlands, with the Dutch Supreme Court ruling in September 2014 that Ecuador must pay the award.

Chevron, in a statement in Spanish, said it was "pleased" with the appeals court decision that confirms a "$106 million" award, an amount that includes interest.

In a separate case, brought by the indigenous people of Ecuador's Lago Agrio region to win compensation for the mass dumping of oilfield waste between the 1970s and 1990s, an Ecuadoran court ordered Chevron to pay $9.5 billion in damages.

The environmental destruction allegedly was perpetrated by Texaco, which Chevron bought in 2001.

But a U.S. court found last year that the plaintiffs' legal team, led by American lawyer Steven Donziger, conspired to win the case by "egregious fraud," including bribing a judge, writing the court's verdict themselves and secretly paying the authors of an ostensibly independent report.

Copyright Agence France-Presse, 2015

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