Industryweek 5597 Texaco
Industryweek 5597 Texaco
Industryweek 5597 Texaco
Industryweek 5597 Texaco
Industryweek 5597 Texaco

Chevron Ordered to Pay Ecuador $9.51 Billion on Appeal

Nov. 13, 2013
Chevron has never worked directly in Ecuador but inherited the pollution lawsuit when it acquired former rival Texaco in 2001.

QUITO - An Ecuadoran court upheld a ruling that Chevron (IW 500/2) was liable for environmental damage in its Amazon basin region by sister company Texaco, but ordered it to pay a reduced $9.51 billion.

The Supreme Court on Tuesday upheld a 2012 ruling against Texaco, which operated in the South American nation from 1964-1990, but dramatically reduced the amount to be paid in damages to $9.51 billion from $19 billion, the ruling said.

Just last month, Chevron was in court in New York trying not to pay the damages.

Chevron wants a New York district judge to prevent lawyer Steven Donziger, Ecuadoran villagers and environmental activists from using the U.S. courts to force Chevron to pay its fine.

A court in Ecuador first had ordered Chevron to pay $18 billion in damages, which was later raised to $19 billion, to people from Lago Agrio in Sucumbios province, in the Amazon basin region for environmental damage.

But Chevron has almost no assets in Ecuador and is resisting attempts by the original plaintiffs to use the American courts to force its U.S. operation to pay up.

"After a wait of a year and a half, the court has issued a sentence that confirms all the evidence gathered, the damage and the payment Chevron must make," said Juan Pablo Saenz, one of the lawyers for the plaintiffs.

"At the judicial level, everything stops there," he said, adding however that the victory was "incomplete" because of the reduced amount of damages.

Water Supply Compromised

Chevron has never worked directly in Ecuador but inherited the pollution lawsuit when it acquired former rival Texaco in 2001. It is fighting against having to pay the fine.

The New York case is the latest in years of litigation over pollution attributed to Texaco Petroleum, which worked in the Amazon from 1964 to 1990.

Thousands of villagers say they were sickened and many have cancer from the oil spillage's effect on their water supply.

The case could have implications for lawsuits in Canada and Brazil, where the plaintiffs are going after Chevron's assets.

Commentators say the case could help to determine the extent to which U.S. courts can pass judgment on alleged misconduct of American multinationals abroad.

In the U.S. District Court in New York, Chevron is alleging fraud and violations under the Racketeer Influenced and Corrupt Organizations Act.

Chevron maintains that Ecuador and its state oil company should pay the damages.

Copyright Agence France-Presse, 2013

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