Chevron wins a round in U.S. suit against lawyer in Ecuador case

NEW YORK — A federal judge rejected a bid on Friday by a U.S. lawyer to stall the enforcement of a ruling that found he used fraud to secure a $9.5 billion pollution judgement against Chevron in Ecuador.

Lawyer Steven Donziger is appealing a 500-page decision issued by U.S. District Judge Lewis Kaplan in March that barred him from collecting on a $9.5 billion judgement against Chevron in the United States.

Chevron filed a lawsuit against DonzIger in New York, claiming he used bribery and fake evidence to win the historic damage award for a group of villagers who claimed the oil giant polluted an area of northeastern Ecuador.

An Ecuadorean judge awarded the villagers $18 billion in 2011 but the country’s high court later cut the judgement in half.

Kaplan ruled Donziger bribed a former judge to ghost-write the Ecuadorean judgement and committed other improprieties, finding him liable for fraud and racketeering.

Donziger asked Kaplan to put the decision on hold while a federal appeals court considers the merits of his challenge, a process that will likely take months to resolve.

But in Friday’s order, Kaplan said Donziger’s arguments for a stay were largely “without merit.”

Donziger’s “claims of irreparable injury rest on a pastiche of unsupported assertions, contradictions of undisputed evidence and fertile imagination,” according to Kaplan’s opinion.

Kaplan did grant Donziger narrow relief on one point.

He allowed that the shares Donziger holdes in Amazonia, a company organized to collect and distribute any proceeds of Ecuadorean judgement, will be held by the court — not Chevron — pending the final outcome of the appeal.

Chevron spokesman Morgan Crinklaw called the attorney’s motion to stay “yet another attempt to delay and distract from the unrebutted evidence against him” and said the company was confident it would win the appeals court.

Donzinger’s attorney had no comment.

The long-running case centers on an oil field in the Amazon jungle, known as Lago Agrio, where Texaco operated from 1964 to 1994, which Chevron later acquired through its purchase of Texaco.

Chevron asserts that Texaco cleaned up the site before handing it over to a state-controlled company but the villagers say they are still suffering from the legacy of environmental contamination.

Donziger has repeatedly accused Kaplan of bias and claimed the judge allowed personal animosity to cloud his decision. He denies the bribery and fraud allegations.

The New York ruling does not restrict the villagers from trying to seek enforcement of the Ecuadorean judgement outside the United States.

A Canadian court ruled in December that Ontario was a proper jurisdiction for the Ecuadorean plaintiffs to press Chevron to pay up and the country’s Supreme Court earlier this month agreed to hear the company’s appeal of that ruling.

The Ecuadoreans are also pursuing cases in Argentina and Brazil in the hopes of one day seeking a payout from the case.

The case is Chevron Corp v. Steven Donziger et al, U.S. District Court for the Southern District of New York, No. 11-0691.

Source: Reuters

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