Comments on: Lago Agrio: Chevron Wins Investment Treaty Arbitration Against Ecuador

By: Lago Agrio: The Remedy | Letters Blogatory | Letters Blogatory

Lago Agrio: The Remedy | Letters Blogatory | Letters Blogatory — Fri, 14 Sep 2018 13:11:15 +0000

[…] is the third post about the new arbitral award in the Chevron/Ecuador case. The first post addressed the tribunal’s finding that the Lago Agrio judgment was ghostwritten. The second […]

By: Ted Folkman

Ted Folkman — Tue, 11 Sep 2018 21:57:54 +0000

One other point: I think we should also look for a confirmation proceeding in Canada, which might then lead to a fight about the preclusive effect of the tribunal’s findings of fact. There may be a fight like that about the preclusive effect of Judge Kaplan’s findings, but in general a foreign court is more likely to recognize an arbitral award than to recognize a judgment, because recognition of arbitral awards is a treaty obligation, whereas recognition of a judgment is merely a matter of comity.

By: Ted Folkman

Ted Folkman — Tue, 11 Sep 2018 21:55:52 +0000

In reply to Alessandro Spinillo. Thanks, Alessandro! I agree with your thought about the likelihood of collection.

By: Alessandro Spinillo

Alessandro Spinillo — Mon, 10 Sep 2018 14:13:13 +0000

Thank you for covering this important development, Ted. Just a few thoughts on the matter. As I understood it, Chevron’s basic relief sought in the investment arbitration was an injunction ordering Ecuador to make its best efforts to prevent the LAPs from enforcing the Ecuadorian court ruling in their favor in any jurisdiction across the world. The tribunal had already granted a temporary injunction in favor of Chevron containing such an order, which now should become a definitive one. A tribunal admission that the Ecuador court ruling involved fraud would equate to a denial of justice under the Ecuador-USA BIT.

I agree with you on that the next probable steps could be (1) Chevron moving to US courts to have the new award recognized and enforced (2) Ecuador moving to the competent Dutch court to set aside the new award. Given that arbitration awards are “portable”, Chevron, in addition to the defense of separate personality, can raise the new award as a defense on the merits in any jurisdiction in which the LAPs intend enforce their Ecuadorian ruling, thus the chances that the LAPs will ever collect that ruling have become even slimmer as from today.