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Ecuador Planned Sharon Stone Luxury Trip

While government fails to clean up environmental damage at center of campaign.

Latinvex 25/02/2015

Ecuador's government spent $325,400 on a planned luxury trip for actress Sharon Stone to denounce Chevron. (Photo: Thore Siebrands)

Ecuador's government spent $325,400 on a planned luxury trip for actress Sharon Stone to denounce Chevron. (Photo: Thore Siebrands)

Ecuador’s hypocrisy over environmental pollution was again revealed this week as it emerged that a US PR agency financed by the Ecuadorian government spent $325,400 on a planned luxury trip for actress Sharon Stone.

The Basic Instinct actress was supposed to tour areas allegedly contaminated by Texaco, a unit of Chevron, and denounce the US oil company. Meanwhile, it has failed to clean up much of the contaminated areas, which Chevron says are largely caused by spills by Ecuador’s state oil company.

In the end, Stone didn’t go as she had an accident in Brazil. The PR firm, MCSquared, now wants its money back and sued Stone, according to the New York Daily News.

MCSquared received a total of $6.4 million from Ecuador’s government between May 2013 and April 2014 to attack Chevron. The Hill, a Washington publication, calls it “a stunning figure in the niche business of foreign government lobbying.”

Despite Stone’s cancellation, MCSquared was able to secure other stars to take the tour and denounce Chevron. They include Mia Farrow and Danny Glover.

MCSquared paid $188,391 to Greater Talent Network, which represents Farrow, and $330,000 to the American Program Bureau, which represents Glover, according to an amended Foreign Agent Registration Act disclosure it filed in September last year.

Farrow says she was paid but that she received a smaller amount than what her firm received.

The firm’s payments to the two talent agencies represented more than a quarter of its total itemized disbursements associated with its contract with Ecuador, the Washington Free Bacon reported.

MCSquared subsequently promoted the actors’ visits to Ecuador in a pair of press releases. In January last year, it issued a press release titled “Actress and Humanitarian Activist Mia Farrow Joins Campaign to Hold Chevron Accountable for Contamination in Ecuadorian Rainforest”.

“The acclaimed actress and prominent humanitarian Mia Farrow will visit the Ecuadorian Amazon rainforest to witness first hand the massive environmental damage caused by Texaco, now Chevron, during decades of operation in the northeastern region of Ecuador,” it said.

The statement attacked Chevron’s lawsuit against US activist lawyer Steven Donziger and others and even the judge that ruled in favor of Chevron, Lewis Kaplan.

A few months earlier – in November 2013 – MCSquared issued a press release titled “Actor Danny Glover to Visit Contaminated Areas in the Ecuadorian Rainforest Where Chevron Operated.”

“The famous American @@actor@@ and social activist Danny Glover arrived in Ecuador yesterday where he plans to visit an area of the Ecuadorian Amazon rainforest were the multinational oil giant Chevron operated, and was sentenced by a local court to pay a multibillion-dollar fine for a massive environmental contamination, “ it said.

It also attacked the Chevron lawsuit and Judge Kapan.

“Real and borderline celebrities have visited a number of sites in the area, most commonly over the past 12 years a pit with leftover oil residue called Aguarico-4 which the government insists is now Chevron’s fault, despite ample documentary evidence to the contrary,” Ecuadorian consulting firm Analytica said last year.

Among celebrities that have visited the site (albeit not through MCSquared) are US actress Darryl Hannahand UK actress Trudie Styler (also known as the wife of musician Sting), who both visited Ecuador in 2007.

In 2011, an Ecuadorian court in Lago Agrio ruled that Chevron had to pay $19 billion in environmental damages for pollution by Texaco when it operated in the country between 1964 and 1990

In March last year, Judge Kaplan ruled that the Ecuador verdict was tainted by fraud. “The decision in the Lago Agrio case was obtained by corrupt means,” he said. “The defendants here may not be allowed to benefit from that in any way.”

Kaplan ruled that lawyers Donziger, Gerardo Camacho Naranjo and Javier Piaguaje Payaguaje have to provide Chevron with any proceeds from the Ecuador ruling. While Chevron has refused to comply with that ruling, plaintiffs led by Donziger have tried to get Chevron assets in other countries such as Argentina, Brazil and Canada.

Chevron was represented by a Gibson Dunn team led by Randy Mastro, Co-Chair of the Litigation Practice Group at the firm and a former federal prosecutor who gained prominence pursuing mobsters in New York, he also served as New York’s deputy mayor and chief of staff under Rudolph Giuliani. During the trial, Mastro managed to get former judge Nicolas Zambrano, who issued the verdict against Chevron, to admit that he never even read his own judgment or key evidence included. “I’ve never seen anything like it in my 33 years as a lawyer and public prosecutor,” Mastro told Latinvex before the trial ended. “It’s really the brazenness, theaudaciousness of the conduct, and then to take the false narrative created in Ecuador and trumpet it in the US, to shake down a US company.”

Earlier this month, James Russell DeLeon, the principal funder of the lawsuit against Chevron in Ecuador, quit the case and says he was misled by Donziger.

"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,” he said in a statement released by Chevron on February 16. “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.”

Last year, Patton Boggs also withdrew from the case. “The recent opinion of the United States District Court for the Southern District of New York in the Chevron v. Donziger [racketeering] case includes a number of factual findings about matters which would have materially affected our firm’s decision to become involved and stay involved as counsel here,” Patton Boggs said in a statement in the settlement agreement in May 2014. “Based on the court’s findings, Patton Boggs regrets its involvement in this matter.”

For a law firm of Patton Boggs’s heft, the settlement is highly unusual, according to Bloomberg Businessweek Assistant Managing Editor Paul M. Barrett. “Law firms occasionally drop a client in the breach,” he wrote. “It’s almost unheard of, however, for a major law firm to humiliate itself in the fashion Patton Boggs did in the face of Chevron’s threat to pursue pending fraud allegations against the firm.”

Barrett details the fraud by Donziger in his new book Law of the Jungle: The $19 Billion Legal Battle Over Oil in the Rain Forest and the Lawyer Who'd Stop at Nothing to Win.

Key highlights of the book include how Donziger pressured various Ecuadorian judges (through both blackmail and monetary incentives), how he was behind the selection of the so called “independent expert” and then masterminded the expert’s official report on Texaco’s pollution (he hired a US company to write it and then pass it off as the expert’s) and last, but not least, that Donziger composed large portions of the final verdict against Chevron. The expert report included outright false and exaggerated claims about Texaco’s pollution, aimed at boosting the size of the intended fine.

Barrett also shows how Donziger actively pushed for a strategy of focusing on Chevron as the sole culprit of oil damage despite Ecuador’s own failings to avoid pollution and then to fix it. Amazingly enough, he also opposed any remediation of pollution in fear that it would hurt his lawsuit. “The lawyer who had raised millions of dollars from environmentalists committed to saving Indians and the rain forest was actively blocking attempts to clean the contamination,” Barrett writes.

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