Agreed again—Doug

Agreed—Doug

Thanks, Doug. To expand a little on the judicial estoppel point, which both you and I have briefly addressed here: I do think that there would be a good estoppel argument if the issue were the systematic adequacy of the Ecuadoran judiciary, given Chevron’s representations about the quality of Ecuadoran justice in Aguinda. But the Second Circuit made it clear that systematic inadequacy was not the basis of its opinion: ” Given the record in this case, we do not reach any contentions as to the Ecuadorian judiciary in general.”

Here are a few additional observations. Readers may wish to take into account that I represented Chevron on an amicus brief in 2012, arguing that the evidence of fraud in the Lago Agrio judgment was already clear, and that I subsequently served as an independent consultant to the company on the issue. I no longer have any relationship with Chevron.

First, yesterday’s unanimous decision by a three-judge panel of the federal Court of Appeals in New York is a slam dunk for Chevron. Not only does the Court accept the voluminous and – as Ted notes – unchallenged factual findings of fraud by the lower court, it rejects each and every one of Donziger’s legal appeals.

Second, given the unsavory evidence of misconduct by Donziger and his cronies, they understandably chose to appeal from the lower court’s adverse decision only on legal grounds. But if their strategy was intended to divert the attention of the Court of Appeals from the evidence of fraud, it did not succeed; the Court of Appeals devoted nearly 50 pages of its opinion to an extensive summary of the findings of fraud. The Court could have affirmed these factual findings in a couple of paragraphs. The fact that it chose to lay out the evidence in such detail suggests that the Court of Appeals was moved – or disgusted — by the sordid saga of professional misconduct.

The Court of Appeals’ opinion also effectively refutes many of the claims made in public fora by Donziger and his supporters. Among others are the following:

Donziger Claim: The 2014 ruling against Donziger by federal District Court Judge Lewis Kaplan, who found that Donziger was the ringleader of systematic and blatant fraud against Chevron, stemmed from the judge’s personal bias against Donziger.

Reality: The three appellate judges unanimously upheld all of Judge Kaplan’s findings of fact, largely because Donziger did not dare to challenge them before the appellate tribunal.

Donziger Claim: Chevron’s case depended on the testimony of one corrupt and dishonest Ecuadorian judge.

Reality: The appellate opinion demonstrates that the evidence of fraud by Donziger and cronies was massive, extending far beyond the testimony of a single unreliable witness (Judge Guerra). The vast majority of the evidence summarized by the Court of Appeals does not even mention Judge Guerra, let alone depend on his testimony.

Donziger Claim: Multiple Ecuadorian judges ruled against Chevron’s allegations of fraud.

Reality: As the Court of Appeals explains, the Ecuadorian appellate courts and national (supreme) court ruled that they did not have jurisdiction to address Chevron’s allegations of fraud, expressly leaving that issue to US judges and perhaps other proceedings. The US judges have now unanimously either found fraud by Donziger, or upheld unchallenged findings of fraud by Donziger.

Donziger Claim: Texaco and ultimately Chevron agreed to accept any judgment that might be entered by the Ecuadorian courts, no matter what, in return for transferring the case from the US to Ecuador. Chevron made its bed and must lie in it.

Reality: Texaco and Chevron always reserved the right to challenge any Ecuadorian judgment based on fraud. Chevron has now done so – with resounding success.

Donziger Claim: Judge Kaplan’s 2014 order exceeded his authority by invalidating enforcement of the Ecuadorian judgment worldwide.

Reality: In his 2014 ruling Judge Kaplan acted well within his authority as a US federal judge. Although years earlier he issued an overbroad injunction that was overturned on appeal, his 2014 order properly enjoined enforcement of the fraudulent Ecuadorian judgment only before US courts, and barred only US citizen Donziger, along with his co-defendants over whom the US court had personal jurisdiction, from profiting from any enforcement of the fraudulent judgment.

Donziger Claim: Judge Kaplan violated international comity by disrespecting the judgment of Ecuadorian courts.

Reality: Judge Kaplan did not invalidate the Ecuadorian judgment. The Ecuadorian plaintiffs remain free to try to enforce their judgment anywhere in the world outside the US, if they can find a court willing to enforce it. But the case decided by Judge Kaplan involved a suit brought in the US by a US company – Chevron – against a US lawyer – Donziger – for fraud orchestrated largely in the US. The case was about a wrong committed by a US citizen against a US company. No consideration of comity required Judge Kaplan or the Court of Appeals to refrain from ruling on the merits of Chevron’s suit against Donziger.

Donziger Claim: The US court rulings disrespect the environment and the rights of Amazonian residents.

Reality: The US court rulings were about – and only about – the fraudulent conduct of the Ecuadorian lawsuit by Donziger and some members of his legal team. US courts have made no pronouncements about pollution of the Amazon. The environmental issues remain to be resolved by an honest lawsuit or by reasonable agreement. But no settlement can or should be based on a fraudulent judgment.

Bottom line: Although Donziger has lost his appeal thus far and may eventually lose his law license as well, the big losers continue to be the residents of the Amazon who have been ill served by their crooked lawyers. The Amazon residents have never had an honest judicial hearing on the extent to which past pollution may affect their health and environment. Their right to such a hearing will never be met in a timely way by this seemingly never-ending litigation. The best way forward continues to be for all parties to pursue a settlement in good faith.