Lago Agrio: Chevron Tries To Drop All Damages Claims Against Donziger

Update: Here is some rank speculation that occurred to me. I wondered in this post why Chevron would continue to try to bifurcate the issues if the trial is going to be a bench trial. Try this on for size: Chevron intends to get findings of fact and conclusions of law from Judge Kaplan on liability and then could decide not to proceed to the remedy phase. So Donziger would not have the opportunity to put on his unclean hands evidence, and Chevron would have findings that, it could argue, might have preclusive effect in proceedings elsewhere in the world, and in any case would be really good from a PR point of view.

More rank speculation: Another thought about why Chevron may have dropped its damages claims: perhaps there was a worry that Donziger might seek bankruptcy protection, thus delaying the trial for an uncertain amount of time, and potentially introducing a new decisionmaker into the mix? Just a thought.

Yesterday, Chevron filed a notice that attempts to drop all damages claims against Donziger and thus to avoid a jury trial:

Chevron Corporation (“Chevron”) hereby gives notice that, upon a finding from this Court under Fed. R. Civ. P. 39(a)(2) that all issues in this case will be tried by the Court: (i) Chevron will not seek money damages against Steven R. Donziger, The Law Offices of Steven R. Donziger, and Donziger & Associates, PLLC (“Donziger Defendants”) only in this action; (ii) at trial and in all other phases of this action, Chevron will seek only equitable relief against the Donziger Defendants, and; (iii) Chevron will waive all claims for money damages relief against the Donziger Defendants only for money damages that have accrued and are asserted in this action only.

This is curious in a few ways. First, Chevron is not dropping its damages claims; it is saying that it will drop its damages claims if the Court first determines that the case will be tried to the court rather than to a jury. Will Judge Kaplan allow this? It seems pretty clear from earlier orders (especially the order of September 17) that Judge Kaplan wanted a decision from Chevron by today, not a promise to make a decision if the judge decides an issue a particular way. Second, why all the language about “in this action only?” Surely Chevron cannot drop damages claims now and then relitigate them against Donziger later? In any event, I think we now will see some litigation about whether Chevron’s notice is sufficient to deprive Donziger of his right to trial by jury.

The notice is also noteworthy because it is strangely defensive, which is not Chevron’s usual tone at all. Chevron continues to seek a bifurcation of the trial. While it can’t point to a risk of prejudice (which exists in a jury trial but not a bench trial), it claims that “the risk of extra-judicial prejudice” justifies trying Donziger’s liability before trying the equitable remedies. Why? It seems evident that Chevron really, really does not want Donziger to put on a defense of unclean hands, i.e., a defense that Chevron is not entitled to relief even if it can prove its case because it, too, acted inequitably in Ecuador. What is Chevron afraid of? I mean, if Chevron wins its liability case, as presumably it thinks it will, Donziger will get to put on his evidence of unclean hands in the remedies phase.

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2d ed. 2016), a nuts-and-bolts guide to international judicial assistance issues, and of the chapter on service of process in the ABA's forthcoming treatise on International Aspects of US Litigation, and he is the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012, 2014, and 2015.

3 thoughts on “Lago Agrio: Chevron Tries To Drop All Damages Claims Against Donziger

  1. In Lago Agrio the court refused to order a bench trial. DOC 1500 10/7/2013.

    “The Court has considered all of defendants arguments and concluded that all are without merit. Accordingly, the Court holds that there is no right to trial by jury. The Court declines to order a jury trial in this case.”

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