Noticia

Chevron Shakedown Rout

Steven Donziger suffers another legal humiliation.

The Wall Street Journal 09/08/2016

Photo: The Wall Street Journal

Photo: The Wall Street Journal

One of the most egregious legal frauds in history may finally be over. On Monday a unanimous three-judge panel of the Second Circuit Court of Appeals ruled that an Ecuadorian judgment against Chevron was the product of fraud, coercion and bribery and couldn’t be enforced.

In a 127-page opinion, Judge Amalya Kearse said the court “found no basis for dismissal or reversal” of a lower court’s decision and called lawyer Steven Donziger’s conduct in pursuit of Chevron “corrupt” and a fiasco of legal terrorism and ransom at the highest level. “Donziger hoped for an astronomic estimate that would have an in terrorem effect,” the court wrote, “impelling Chevron to agree to a settlement.”

That’s an understatement. Readers will recall the parade of malfeasance perpetrated by Mr. Donziger as he pursued a $113 billion case for what he claimed were oil pits left by Texaco (now merged with Chevron) in the 1970s. Texaco’s pits had long been cleaned up and the company had been released from liability by Ecuador’s government, but Mr. Donziger lined up environmentalists and even actress Daryl Hannah to create a media circus that would force the company to settle.

In a 485-page decision in March 2014, federal district judge Lewis Kaplan found that Mr. Donziger had committed acts that would qualify as violations of the federal Racketeer Influence and Corrupt Organizations Act and nearly every standard of decent professional behavior. The lawyer’s suit was an exercise in pure extortion, Judge Kaplan wrote, noting that the episode was “offensive to the laws of any nation that aspires to the rule of law, including Ecuador.”

Faced with an activist-trial-lawyer-media blitz, most companies capitulate and settle to avoid the huge potential costs of litigation and the risk of unpredictable verdicts. Mr. Donziger may appeal to the Supreme Court, but the Second Circuit is hardly a conservative venue. Chevron’s vindication looks to be final.

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