On Ted’s second point, the Fajardo deposition, it would be passing strange if plaintiffs’ counsel – having mightily resisted any discovery from Ecuador in the RICO case – would agree to it in the 1782 discovery proceedings. But just to be sure, I checked with Gibson Dunn, the law firm representing Chevron in the 1782 cases, and am informed that Chevron has repeatedly requested Fajardo’s deposition, only to be told that he refuses to appear. No surprise there.

Undaunted, Chevron has noticed Fajardo’s deposition in the RICO case. (Perhaps Fajardo will have a change of heart?)

Finally, I understand Ted’s “fraternal sympathy” with Patton Boggs. (I will be less sympathetic, if discovery reveals that Patton Boggs had culpable knowledge of the fraudulent content of the Fajardo declaration, at the time the firm worked with the plaintiffs to draft it and present it to federal judges in the US.)

My concern, however, is that in his sympathy for Patton Boggs, Ted may have been unintentionally unfair to Judge Kaplan. Judge Kaplan’s lengthy opinion on the discovery requested from Patton Boggs was thorough and judicious. He detailed the prima facie evidence that fraud and other crimes were committed by Lago Agrio plaintiffs’ counsel; narrowed the discovery against Patton Boggs to those particular incidents; demonstrated that other means of obtaining the information had been systematically blocked by plaintiffs’ counsel; showed reason to anticipate that few attorney-client communications are likely to be found in the relevant Patton Boggs documents; and allowed Patton Boggs nonetheless to assert claims of privilege for any attorney-client and attorney mental impressions that may be found in the documents. In striking contrast to the judicial farce in Ecuador, Judge Kaplan’s opinion is well-reasoned, restrained and fair.

I should add that it would be pretty unusual to take this kind of deposition in a § 1782 case—a “meta-deposition,” in a way—but then everything about this case is unusual.

Thanks, Doug, for the interesting and fair-minded comment. I think you mistake two of my points:

1. I have never argued that Chevron, by seeking to have the case litigated in Ecuador, assumed the risk that the plaintiffs’ lawyers would commit fraud there. Instead, I have argued that Chevron may have assumed the risk that the Ecuadoran courts would not meet the minimum standards required for their judgments to be entitled to recognition and enforcement in the United States. I don’t think anyone ever can be said to assume the risk that an opponent will commit fraud.

2. On the question of a Fajardo deposition, what I was asking was whether Chevron had had an opportunity to take Fajardo’s testimony in any of the § 1782 proceedings in which his declaration was filed, not whether Chevron has had an opportunity to take his testimony in Judge Kaplan’s court. It may be that the answer is no. It may be that Chevron never sought his deposition in any of the § 1782 cases. It may be that Chevron did seek his deposition and was refused permission. I don’t know the answer to these questions without taking a close look at lots of dockets. But it seems to me that Chevron knew or suspected, at the time it was engaged in its § 1782 campaign, that Fajardo’s declaration wasn’t the whole story, and I think a judge should have and perhaps would have granted leave to take Fajardo’s deposition in the circumstances, if Chevron had asked.

Also, I would point out that you and I don’t disagree about a key point—Judge Kaplan didn’t pin the fraud on Patton Boggs, and it’s not really relevant to the crime/fraud analysis whether Patton Boggs was guilty of misconduct. As I wrote: “I have pointed above to reasons why it’s not clear that Patton Boggs itself acted wrongly, but as the judge notes, the key to the crime-fraud analysis is not wrongdoing by the lawyer but wrongdoing by the client: ‘the loss of the privilege does not depend … upon proof that client and attorney are involved in equal guilt. The attorney may be innocent, and still the guilty client must let the truth come out.'”

You may be right that I have minimized the misleading nature of the Fajardo declaration, but the main point of my post was to express fraternal sympathy with Patton Boggs. The most scrupulously ethical lawyers in the world would be mighty unhappy, I think, to find that their litigation files were open to their opponent’s inspection, and to make a new point, the potential chill on the adversary system in high-profile cases is a real concern.

Finding “at least probable cause to believe that there was fraud or other criminal activity in the procurement of the [Ecuadorian] judgment,” Judge Kaplan ordered Patton Boggs to produce the documents, even if they include attorney work product. However, the firm may still claim privilege for attorney mental impressions or attorney-client communications. The judge will then evaluate whether those claims survive the “crime-fraud” exception to privilege.
In a typically fair-minded post, Ted Folkman recites the judge’s damning findings, but is “highly sympathetic” to Patton Boggs.

I have nothing against Patton Boggs. My past critiques of unethical conduct by plaintiffs’ lawyers in the Ecuadorian litigation expressly exempted Patton Boggs. But I think Ted is too hard on Judge Kaplan and too soft on the plaintiffs’ lawyers.

The crux of our disagreement is the declaration filed by plaintiffs’ lead Ecuadorian lawyer, Pablo Fajardo, in at least 15 separate discovery proceedings in US courts. Fajardo, Judge Kaplan found, gave a “bland description” of the Ecuadorian litigation. In a failed effort to persuade a Denver federal court that “nothing amiss” tainted the report of the Ecuadorian court’s “independent” expert, Fajardo failed to mention that he and plaintiffs’ US lawyer Steven Donziger had threatened the Ecuadorian judge, and that they had arranged for their consultants to write “all or most” of the expert’s purported report, which they then portrayed as the work of the “independent” expert.
From this and other evidence Judge Kaplan found probable cause to suspect that “at least some of those involved” in the Denver proceeding committed “mail and/or wire fraud and obstructed justice,” by formulating and filing a “seriously misleading account of what happened.”

Ted objects that this treats Patton Boggs unfairly. In his view Fajardo’s affidavit was, apparently, not “outright false.” Fajardo merely “omitted key facts.” Ted argues that attorneys are ethically obliged to tell the truth, but not the whole truth. “Patton Boggs’s mistake, if it was a mistake,” he adds, “was probably one of litigation strategy and not one of professional responsibility.”

I respectfully disagree in several respects. First, Judge Kaplan did not pin the probable fraud on Patton Boggs, but only on “at least some of those involved.” Although the judge found that Patton Boggs “worked with the [plaintiffs] to draft the Fajardo Declaration,” the judge left open the issue of “whether or not [Patton Boggs] knew … at the time” that the declaration was deceptive. The judge found no need to “determine for present purposes whether there is probable cause to suspect that [Patton Boggs] or any of its personnel was a culpable or knowing participant in any alleged fraud or crime.”

In short, the judge was fair to Patton Boggs.

But someone committed fraud. In Judge Kaplan’s apt phrase, the Fajardo declaration was not merely incomplete, but “seriously misleading.” And hence fraudulent as well: for purposes of mail or wire fraud, as Judge Kaplan noted, quoting Neder v. US, 527 U.S. 1 (1999), “the well-settled meaning of ‘fraud’ require[s] a misrepresentation or concealment of material facts.” To aver, as Fajardo did, that plaintiffs “delivered materials” to the court-appointed expert—without mentioning that the materials delivered were in fact the expert’s purported report—is both to misrepresent and to conceal material facts.

Moreover, Fajardo characterized the court’s expert as “independent”—when in fact Judge Kaplan found probable cause to believe that the expert was “handpicked” by plaintiffs because they knew he would “play ball” with them, which he did, by eventually presenting as his own a report handed to him by plaintiffs. Ted calls this “the closest [the judge] comes to finding an affirmative misstatement.” But this was not a close call; Fajardo’s description of the court’s purported expert as “independent” was—even by Ted’s standard—“outright false.”

In further defense of the ethics of the Fajardo declaration, Ted asks, “But didn’t Chevron have an opportunity to take Fajardo’s deposition?” The answer is “no.” As Judge Kaplan explained at length, the plaintiffs and their lawyers “are defying this Court’s order to produce information in the hands of their Ecuadorian lawyers and even their non-lawyer associates.”

Apart from the Fajardo declaration, Ted finds “similarly equivocal” Patton Boggs’ role in generating the “cleansing reports” later filed by other experts in the Ecuadorian litigation, after the court-appointed expert’s fraud was revealed. But Ted does not make clear that Judge Kaplan reached a similar conclusion: “on the present record, there is insufficient factual basis to suspect that the cleansing reports themselves were fraudulent …”

Again, Judge Kaplan was fair to Patton Boggs.

Finally, I think Ted overlooks an important point in the findings of probable cause of fraud in the Fajardo declaration. The Lago Agrio plaintiffs filed that declaration in at least 15 US court proceedings. Ted has long argued that Chevron in effect assumed the risk that plaintiffs’ lawyers would commit fraud in the Ecuadorian litigation when Chevron asked, a decade ago, for the case to be tried in Ecuador. I have argued to the contrary. Regardless, what we now have is a judicial finding of probable cause of fraud by plaintiffs’ lawyers (not necessarily by Patton Boggs) before courts in this country. Surely Ted would not now argue that Chevron assumed that risk, too.