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By Ted Folkman of Rubin and Rudman LLP

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Lago Agrio: Donziger finishes serving his sentence

Steven Donziger
Credit: @sdonziger

Steven Donziger finished serving his sentence yesterday following his conviction of criminal contempt of court. Although it will come too late to affect his sentence, his appeal challenging the constitutionality of the proceedings, in which the government was represented by a private prosecutor as provided in Fed. R. Crim. P. 42 who, Donziger says, was not subject to the requisite supervision by the Attorney General, is still pending. I am not sure, but I think that the appeal is not moot just because the sentence has run, and as I’ve written before, the issue he raises on appeal might well be a good one. This must be a happy day for Donziger and his family, and those of us who have followed all the twists and turns in the saga should wish him well—I certainly do.

Something is wrong on the Internet.

At the same time, and especially in light of the unbelievably awesome PR campaign Donziger has been running on social media, I think it is really important to continue to insist on understanding exactly what Donziger did to lead to his conviction. I know, it’s hopeless to get worked up because “something is wrong on the Internet.” But while Donziger set out to do something good for the world, and while Judge Kaplan may have gotten his findings of fact wrong concerning the ghostwriting of the Ecuadoran judgment, Donziger lost his way after losing the case. I’ve said it before and I’ll say it again. Knowing how to lose a case is a super-important lawyer skill that Donziger never mastered.

Kenny Rodgers, the Gambler
You got to know when to hold ’em, know when to fold ’em.

Losing the RICO case must have been hard, personally and professionally. And the consequences of the loss were serious: the court’s judgment that Donziger had participated in a scheme to obtain the Ecuadoran judgment by fraud led directly to his disbarment, and he owes Chevron more money than he probably can ever pay. But no one prosecuted Donziger for the fraud in Ecuador, and no one goes to prison for owing a lot of money on a civil judgment. What did Donziger get in trouble for? Was his conviction a miscarriage of justice that justifies the Twitter hagiography?

No, Donziger’s conviction was not a miscarriage of justice. He was convicted of several violations of a court order. The law here is not complicated. If you are the subject of a court order, even if you think it is wrong, even if you have appealed it or plan to appeal it, you have to obey it unless you obtain a stay. That’s the law for me, for you, for Steven Donziger, and for scofflaws like Donald Trump, who was just held in contempt by a judge in New York for failure to comply with a discovery order—the same kind of violation that formed part of the basis of the charges against Donziger. There’s no question that Judge Kaplan, the judge who laid the contempt charges against Donziger, and Judge Preska, the judge who heard the case, came down very hard on Donziger. Maybe the case was as unprecedented as Donziger says. But as far as I know the kind of brazen, open contempt of a court’s orders by a practicing lawyer with elite credentials might also be unprecedented. Donziger cried out for punishment, in order to vindicate the rule of law.

When Donziger talks or writes about the case, he focuses on his failure to turn over his electronic devices. He doesn’t have a lot to say about his attempt to monetize his interest in the Lago Agrio plaintiffs’ judgment against Ecuador for his own personal benefit, or about his failure to surrender his passports when ordered, or his failure to comply with the court’s order regarding assignment of his interests in the Ecuadoran judgment to Chevron. None of the facts about those contempts of court were really in dispute. And let’s accept for a moment Donziger’s exclusive focus on the charge relating to his electronic devices. He says that they contained attorney-client privileged material and that legal ethics demanded he withhold them. But legal ethics demand competence, and a competent lawyer knows that failing to provide a privilege log, which is what Donziger did in this case, can waive the attorney-client privilege. And legal ethics demand compliance with lawful court orders, not continued groundless refusals to follow the law when the court makes a decision you don’t like.

I wish Donziger a long and happy life doing something other than practicing law. But I am worried by the praise heaped on him by the uninformed. In a sense, Donziger is a Trumpian figure for the left, someone who obviously broke the law but whose supporters don’t seem to understand the facts, or if they do understand the facts, who don’t seem to care. This is maybe a little unfair to Donziger insofar as he, unlike Trump, has been held to account for his conduct; but it’s only a little unfair, because, like Trump, Donziger has shown no awareness that he did anything wrong.

I encourage everyone who is thinking about paying $6 a month to subscribe to “Donziger on Justice,” everyone who wants to retweet Amnesty’s report asserting that Donziger as subject to arbitrary detention, and in general, everyone interested in what really happened to read the judgment in the case, and to read Donziger’s appellate brief so that you can can see what he argued the judge got wrong and, perhaps more importantly, what he did not argue the judge got wrong. I’ve noted it before, but it bears repeating: Donziger does not argue on appeal that the judge got any of the facts wrong. If you want to be an advocate, be an informed advocate! If you want to disagree with Judge Preska, by all means do, but at least confront the facts that she found and that law that she explained.

Ted Folkman

6 responses to “Lago Agrio: Donziger finishes serving his sentence”

  1. Ray Zuppa

    Everything goes back to the Corrupt RICO. It was Judge Kaplan who suggested the RICO. When a federal Judge suggests something he is telling you that he will give you what he is suggesting. (Anyone who has ever litigated a case knows that) That is so improper.

    Then Donziger was stripped of a jury because Chevron dropped their demand for monetary damages. Meanwhile, as you said, Donziger owes Chevron millions — to me that is being denied a Constitutional Right to a jury.

    In any event no matter how much Judge Kaplan tries to disguise the fact, the RICO verdict was solely predicated upon the testimony of a disgraced former Judge — Guerra, who was not the Judge that was allegedly bribed. Guerra — and this came out during the trial — was paid much money by Chevron for his testimony — in the millions. He had previously acted as a bag man for Chevron in Ecuador where he repeatedly tried to corrupt the process so that Chevron — like Putin — could claim it was corrupted. Finally Guerra — while under oath in front of an international tribunal — admitted that he lied during the RICO proceedings when he testified that Donziger bribed the Ecuadorian Judge, etc. So there you go. On top of that Donziger could not even introduce evidence of the pollution.

    DO NOT WAX PHILOSOPHICAL ABOUT KNOWING HOW TO LOSE A CASE. That is such nonsense.

    This is about the biggest and best court house money can buy. Chevron money. And it is happening in the Ninth Circuit as we speak with the Saudi heir case worth some 18 billion dollars. https://www.law360.com/articles/1469809/saudi-heirs-atty-fights-9th-circ-efforts-to-sanction-him

    As to the criminal proceedings how does a Judge act as complainant and Judge at the same time. How does he appoint a special prosecutor that represents Chevron. And instead of putting the case into random assignment as called for by the rules how does he give it to another Judge who is an advisor to the federalist society — which organization is heavily funded by Chevron. How did Judge Kaplan remain on the case. How is it that Judge Kaplan had financial holdings in Chevron. How does it get so corrupt. Well ask the Second Circuit and read their decision in In re Drexel Burnham Lambert Inc. 861 F.2d 1307 (2d Cir. 1988) — that’s the case that stands for the proposition that Judges in the Southern District can get away with anything. In this case they got away with aiding and abetting the slow motion genocide of the indigenous peoples of the Ecuadorian rain forest. Meanwhile we must question whether or not Courts should even be obeyed. Donziger is such a travesty of justice. But unfortunately it is part and parcel of the many travesties of justice that occur in our corporate run courts. Only lawyers who represent the average citizen in federal court know this to be true and were not surprised at any of the above.

    Reply
    1. Ted Folkman

      Thanks for this comment. You make some of the same reasonable points that Donziger made, at the time and later, though none of them was successful (whether Chevron should have been allowed to drop its damages claims, whether the court should have appointed Seward & Kissel as special prosecutor in light of the firm’s past representation of Chevron). But you also repeat some pretty big and obviously false talking points, which is totally understandable given the PR campaign being waged by Donziger and on his behalf. Some examples:

      • You claim that the RICO decision was based solely on the testimony of Judge Guerra. Not true. Just to take what to me was the most important example, Richard Stalin Cabrera, was the supposedly neutral and independent expert who gave a report on the contamination to the Ecuadoran court. Donziger’s team maintained for a long time that Cabrera was an independent expert. But Donziger later admitted that in fact his own consultants had written the report. Don’t take my word for it: you can read the decision in the RICO case, though it’s quite a slog. You might also want to read my post about Guerra’s testimony in the arbitration, which gives a lot more nuance about what exactly Guerra said. I should add that if you’ve read my stuff, you’ll know that I would not have credited Guerra’s testimony if I had been the fact-finder, although that may not have changed the ultimate decision insofar as there were other frauds (e.g., Cabrera) that were essentially uncontested on the facts. But the point of the post you’re responding to was to say that even if a court “gets it wrong,” it’s not okay to defy the court’s orders. I think that holds especially true if you don’t seek review of the erroneous decision. Donziger did not argue on appeal that Judge Kaplan’s findings of fact about Guerra were clearly erroneous, nor did he seek to set aside the judgment after Guerra’s testimony in the arbitration.
      • You repeat Donziger’s claim that Judge Kaplan had financial holdings in Chevron. It’s clear that a judge does not need to recuse just because he owns shares in a mutual fund that, in turn, owns shares in a party.

      Maybe your view is that the American courts are not just imperfect but irredeemably corrupt and unfair, and that it is okay for that reason to disobey court orders. If so, I’m not sure there is much I can do to sway you, except to invite you to look around the world and ask whether you really hold that view. Even just looking at the Ecuador case, if you are comparing our courts to excellent courts in Western Europe, it bears noting that the Dutch court refused to set aside the arbitral award Chevron won against Ecuador. If you are looking in Latin America, it bears noting that the courts of Brazil and Argentina refused to recognize the Ecuadoran judgment. When it seems like the whole world has conspired against you, it may be worth asking whether the whole world is in the wrong, or whether there is some other explanation.

      Just to conclude, before the contempt of court stuff started, I believe I was one of the most pro-Donziger commentators out there who was not a partisan for either side. I suggested that Chevron should be estopped from challenging the Ecuadoran judgment in US courts in light of its positions at the forum non conveniens stage of the case. I suggested that the US courts had not given sufficient weight to the proceedings in the Ecuadoran appellate courts, as to which there was no case-specific showing of fraud. As noted above, I did not accept Judge Guerra’s testimony about the ghostwriting at face value. And even in the context of the contempt proceedings, I’ve suggested that Donziger’s appeal, which rests on constitutional grounds unrelated to what he actually is accused of doing, might well have merit. But he lost me when he didn’t just disobey the court but trumpeted his disobedience. I think his sentence was too harsh in light of his pretrial conditions of release, but I think the court needed to send a strong message to vindicate the rule of law.

      Reply
      1. Ray Zuppa

        US Courts have been loath to expand rights especially in the realm of 5th Amendment Substantive Due Process. But when it comes to procedural Due Process the clear rule of law is that if the procedure is dubious the result cannot stand.

        You characterize me as some dimwitted Donziger groupie. I have read most of the documents on Pacer including Judge Kaplan’s hideous decision. I even sat in on the proceedings multiple times being on trial in the SDNY at the same time.

        Kaplan’s cosmic corrupt judicial bias was evidenced early when he stated before the RICO, when Chevron challenged enforcement of the Judgment:

        [W]e are dealing here with a company of considerable importance to our economy that employs thousands all over the world, that supplies a group of commodities, gasoline, heating oil, other fuels and lubricants on which every one of us depends every single day. I don’t think there is anybody in this courtroom who wants to pull his car into a gas station to fill up and finds that there isn’t any gas there because [Mr. Donziger and his clients] have attached it in Singapore or wherever else [as part of enforcing their final Ecuadorian judgment].

        Kaplan ordered the preliminary injunction blocking enforcement of the Ecuadorian Judgment world-wide. He cannot do that—and that was quickly reversed. Kaplan even ordered Donziger to sit for almost two weeks of depositions with Chevron attorneys, and appointed a Special Master to oversee the depositions. The transcripts demonstrate that this Special Master—a former law partner of Kaplan—to be openly hostile to Donziger.

        I saw the judge’s gut level dislike of Donziger. In fact, it was Kaplan who told Chevron to file a RICO suit in the first place. This is Judge Kaplan speaking from the bench during a hearing on Chevron’s motion to depose Donziger back in September, 2010:

        The object of the whole game, according to Donziger, is to make this so uncomfortable and so unpleasant for Chevron that they’ll write a check and be done with it. … So the name of the game is, arguably, to put a lot of pressure on the courts to feed them a record in part false for the purpose of getting a big judgment or threatening a big judgment, which conceivably might be enforceable in the U.S. or in Britain or some other such place, in order to persuade Chevron to come up with some money. Now, do the phrases Hobbs Act, extortion, RICO, have any bearing here?

        That is disgusting. When something similar to that happened to me in the SDNY (another Judge) an Article III Judge in the EDNY said the same thing: “That is disgusting.”

        First Donziger already had a Judgment that was upheld by Ecuador’s highest Court. Chevron/Texaco brought it to Ecuador upon their successful motion to transfer venue. They swore to abide by the verdict of the Ecuadorian Courts. They did it to avoid a jury and to reap the benefits of a government that had been up for sale in the past. But not this time.

        Instead of honoring the Judgment of the Ecuadorian Courts they absconded with all of their assets in the dead of night.

        Chevron pledged “a lifetime of litigation.”

        And I have seen the famous communications about their long-term strategy: “demonize Donziger.”

        By all conventions the US is supposed to honor foreign Judgments and arbitrations for that matter. Enforcement of foreign judgments is supposed to be boilerplate land lord–Tenant Court. The trial was over but not according to Judge Kaplan. I have no idea how Kaplan can rant about “threatening a big judgment” when that already happened.

        I have read and studied Judge Kaplan’s decision. It is the very essence of prolix conjecture.

        You are wrong sir. If you strip away Guerra’s testimony — which Guerra himself did under oath when he admitted that he lied — there is no evidence of bribery. Period. Your example is just proof of this. Since when is an expert ever independent. Furthermore, you have undoubtedly drafted Affidavits for clients. If you’ve worked with experts, you have undoubtedly drafted Affidavits for them. In fact, Judge’s routinely — in State Court — have the prevailing parties draft orders and judgments which the judge then signs.

        You are making yet another “ghost wrote” argument which argument is obtuse to begin with and which has thoroughly been discredited through detailed forensic evidence.

        In fact, a Harvard Law Professor in a letter to Judge Preska meticulously pointed out what I am saying. Absent Guerra Kaplan’s decision has no evidence — just Kaplan conjecture.

        Of course, Chevron took the hint. What Judge Kaplan said to Chevron was “bring a RICO and you will win.”

        The next sordid chapter was getting rid of the Jury which Chevron and Kaplan did too. I know that Jury pool. They would have thrown Chevron right out of Court.

        You talk of facts but ignore the salient facts. Chevron has never disputed that it dumped 16 billion gallons of highly toxic oil waste into the rivers and streams of the Ecuadorian Rain Forest. At the so-called RICO trial Donziger was not permitted to introduce evidence of the above. Such tactics are common place in the SDNY. I have personally experienced it with Courts shutting down my RICO defenses precluding evidence and theories.

        Donziger’s Appellate Strategy was undoubtedly lame. But did it matter. Read the Drexel case that I cited to. It literally stands for the proposition that a Judge in the SDNY can do whatever he wants. Read the dissent especially. Judge Milton Pollack refused to recuse himself in a case where his decision would have a great influence on whether his wife would make 30 million dollars.

        You simply dismiss the fact that Judge Kaplan had holdings in Chevron with the technical swipe that such things are not held to be improper by the Courts. Well, that may be so. It depends on the Circuit. But it is certainly unethical and creates the appearance of impropriety. Again, read the Drexel decision that I cited to. In point of fact Judge Kaplan appeared as a guest Judge in the Second Circuit. It was a large tobacco case. Judge Kaplan never divulged that he made millions representing big tobacco where he essentially argued that tobacco did not cause cancer. Commentators like you point out that he did not have to. Yet it does not remove the taint and the massive appearance of impropriety that leads believers in natural law and social contract theory to argue that Courts should no longer be obeyed.

        I had an appeal against the Respondent Attorney General at the First Department. One of the Judges had worked at that office some 25 years prior for three years. At the start of oral argument, she rose. Explained the above and recused herself. That is a Judge that gets it.

        Your argument is completely naive to what US Courts are capable of. Dredd Scott v. Sanford (African Americans are not people they are property): Buck v Bell (Forcible sterilization is constitutionally just fine); Plessy v. Ferguson (Segration is just fine) and more recently in the Kelo case (A corporation can kick you out of your house to build a mall).

        You talk about Courts in Europe. But Canada upheld the Judgment. Furthermore, the UN has deemed the prosecution of Donziger to be illegal. (I guess we need UN monitors to make sure that we’re still a democracy) (It does not appear that this country has much use for the UN except when we seek to bomb the hell out of Iraq) Every time we complain about China I have to laugh.

        You neglect the most important function of a prosecutor that was lost in the Donziger case. That is prosecutorial discretion. The US Attorney declined to prosecute two times. First for the purported RICO violations. Secondly for Criminal Contempt. So, Judge Kaplan usurped the role of the executive branch. Appointed a so called “special prosecutor” that represented Chevron — and eschewed all discretion. And then while remaining on the case he gave the trial Judge Preska. Again, Judge Preska is an advisor to the Federalist Society which is heavily financed by Chevron. All during the trial Judge Kaplan lurked in the background as Chevron’s Puppeteer.

        There was a Court in Nazi Germany that tried the conspirators that attempted to assassinate Adolf Hitler. That Judge sentenced the conspirators to death. (My Grandfather survived a concentration camp) The Courts in the Second Circuit have done the same to the indigenous people of Ecuador. Cloaking evil with the veil of the Judiciary does not change a thing as I have already demonstrated. You might want to read about Nan Greer’s report on Chevron here.

        I do commend you for conceding that Chevron should never have been allowed to challenge the Judgment given that it was Chevron who picked the venue.

        Reply
        1. Ted Folkman

          Thanks for your reply. I am not going to comment on everything you’ve written, but I do want to address a few points.

          • You wrote that “Canada upheld the Judgment.” This is a Donziger talking point, but it is false. The Canadian Supreme Court held, in Yaiguaje v. Chevron Canada Ltd., 2015 SCC 42, that the Ontario courts had jurisdiction to hear the claim for recognition and enforcement of the judgment. But the Canadian courts never reached the question whether the judgment was entitled to recognition, and in fact, the end result was dismissal of the case on the grounds that the plaintiffs could not reach the assets of Chevron’s indirect subsidiary in Canada to satisfy the judgment against Chevron they obtained in Ecuador. Nor is it true that “the UN has deemed the prosecution of Donziger to be illegal,” though it is true that the UN Working Group on Arbitrary Detention opined that Donziger was a victim of arbitrary detention. You can read my reaction to the report here if you are interested.
          • When a litigator hires an expert, you are right that everyone understands that in some sense the expert is a partisan. That wasn’t the situation with Cabrera. He was expressly supposed to be an independent, court-appointed expert, not an expert working for either party. That’s why ghostwriting his report constituted a fraud.
          • If you think that recognition and enforcement of foreign country judgments in the United States is a routine matter that happens as a matter of course, then I think you have not read very many of the cases. Recognition of foreign country judgments is not routine in the way that recognition of sister-state judgments is routine. The United States is not a party to any Convention on the question, although it has signed (but not ratified) both the Convention of Choice of Court Agreements and the Judgments Convention.

          I would just note in closing that, like much of what Donziger’s supporters write, your comment does not even try to argue that the facts Judge Preska found were wrong or that she misstated the law about contempt in some way. She may be wrong about the constitutionality of Fed. R. Crim. P. 42—we’ll see when the Second Circuit decides the case.

          Reply
  2. Raymond Zuppa

    1. You are wrong. And once again you claim my statement is a “Donziger talking point.” Please I do not characterize your points as “a Chevron Genocide taking point.” (Funny how Chevron is one of the few companies still doing business with Putin) I have read the decision that you speak of. The Kaplan decision was before the Court. The Court did not recognize it. The Court expressly recognized the Ecuadorian Judgment but stated that Chevron Canada was independent of Chevron for purposes of liability. Canada recognizes the corporate veil more rigorously than any jurisdiction that I have seen. Probably because so many subsidiaries of US Corporations do business there and they want to be business friendly to them.

    What measure of desperation are you feeling when you differentiate between “Arbitrary Detention” and “Illegal Detention.” Logic dictates that an “arbitrary detention” is a an “illegal detention.” What’s more the UN demanded Donziger’s immediate release. (If you try a case against me pray that it’s in front of Judge Kaplan and not a jury)

    2) The gravamen of the RICO was that Donziger bribed the Judge and ghost wrote his decision. (Mostly we are dealing with the RICO predicate of bribery but Chevron threw in the Kitchen sink) That was solely based upon Guerra”s testimony which he recanted under oath. He admitted he lied. Now your fall back position is the purported ghost writing of an independent expert’s report which you call “fraud.” That demonstrates a facile and obtuse understanding of the concept of “fraud” on your part. Especially RICO fraud. As I stated it is routine in New York State Courts for a party to write a decision and order of a Judge who then signs off on it. That did not happen with Donziger. According to you he wrote a report for an Independent Expert. The point is that if the contents of the report are true. And if the contents of the report is known by the expert. The expert can legally sign off on it. It does not matter who wrote it.

    Who do you practice law with and more importantly who do you practice law against.

    3. The United States is a member of the New York Convention on arbitration and generally follows the strictures of the prime conventions. There are grotesque examples where that does not happen — Donziger — but that is the usual way of doing business. What world do you operate in. We live in a Global Economy. If foreign judgments were not recognized that global economy would break down as no one would do business with each other.

    Again you lump me in with “Donziger Supporters” and claim that I do not argue the facts with regard to Judge Preska’s decision. I was there at the sentencing wherein Judge Preska claimed that Donziger had to be hit in the head with a two by four. How many times must I slam you in the head with a two by four. I have argued nothing but the facts. The RICO that gave rise to the orders that Donziger violated were the product of immense fraud and corruption. (You punted on that) Therefore Donziger could not have violated any orders because they were illegal. Judge Preska’s proceedings were illegal. Here let me make it simple for you since you are simple. You cannot be guilty of resisting arrest if the arrest was not premised upon probable cause.

    Look I am tired and disillusioned by Donziger. I am disillusioned with lawyers like you who curry favor with Courts and Corporations and who have betrayed the very ethos that should have led you to law — as opposed to just money. I am even disillusioned by Donziger’s people. I volunteered my services to RICO the RICO — Chevron and their hack lawyers are a RICO Enterprise. The SOL has flown on most but not all of that. But you could still bring an action for fraud on the court which has no SOL. I made the proposal. I want no money unless I win. There were no takers.

    I am done with this. I am done debating losers on all sides.

    Reply
    1. Ted Folkman

      I will let you have the last word and let readers review the source material and judge for themselves who is right, except to take real exception to your claim that I am a lawyer “who curr[ies] favor with Courts and Corporations” and that I have “betrayed the very ethos that should have led [me] to law—as opposed to just money.” Seriously? I’m a sole practitioner in Boston. I have devoted hundreds of hours or more to studying and writing about the Chevron/Ecuador case and haven’t received anything from anybody. Get real.
      The decision of the Ontario Court of Appeal granting summary judgment against the plaintiffs is Yaiguaje v. Chevron Corporation, 2018 ONCA 47, for readers interested in seeing for themselves.

      Reply

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