Early in September, The Hague-based Permanent Court of Arbitration (PCA) issued a decision regarding the conflict between the American oil company Chevron and the Government of Ecuador. The decision, which is binding, rejected a 2011 decision by the Ecuadorian court system that ordered Chevron to pay $9.5 billion in compensation for environmental and other damages that took place in the Amazon region of Ecuador allegedly due to oil operations. The PCA argued that the Ecuadorian court ruling was illegal because it was reached based on fraud, bribery, and corruption. The tribunal blasted the Ecuadorian court and the judge of the case claiming that they violated “international public policy”.
Contrary to other international organizations, the PCA enjoys a very good reputation. It is not an agency of the United Nations. It has been in existence for well over a century and has mediated a plethora of cases involving international disputes.
In 1993, a group of Ecuadorian citizens filed a class action lawsuit in US federal court against the American oil company Texaco, which was followed by a similar suit, also in a U.S Federal court by a group of Peruvian citizens. The claim filed in these lawsuits charged that between 1964 and 1992, Texaco contaminated the rainforests and rivers in Ecuador and Peru, which resulted in environmental damage with negative health consequences to local residents. The U.S Courts refused to deal with the case and advised to bring the case before courts in Peru and Ecuador. Such class action was brought before a court in Ecuador in 2003. Two years earlier Texaco was acquired by Chevron.
In 2007 Rafael Correa was elected president of Ecuador. Correa, a revolutionary left-wing president who subscribed to Hugo Chavez’ anti-American doctrine took interest in the case trying to influence the court decision to Chevron’s detriment through a multi-million-dollar propaganda campaign at the expense of public funds, a fact recently denounced by the current Ecuadorian government.
Correa’s motive was basically the left-wing euphoria and the “anti-imperialist” discourse developed by all members of the ALBA alliance led by Venezuela. Ruling against Chevron would have been a material and political victory in the fight against U.S hegemony in the region.
In 2011, an Ecuadorian court ruled against Chevron and ordered the oil company to pay 8.6 billion dollars if Chevron issued an apology. If Chevron refused to apologize, the amount would increase to 18 billion dollars. A year later an Ecuadorian court of appeals upheld the ruling against Chevron. Chevron tried to block the enforcement of the Ecuadorian courts in the Ecuadorian Supreme court and in international tribunals. Ecuadorian plaintiffs filed lawsuits in Canada and Brazil in an effort to target Chevron’s assets there in order to apply pressure on Chevron to comply with Ecuador’s rulings. Meanwhile, Ecuadorian courts doubled down demanding that Chevron pay 19 billion dollars. This decision was upheld by Ecuador’s National Court of Justice. The National Court of Justice reduced the payment to 9 billion dollars. Chevron then in June of this year appealed to Ecuador’s constitutional court, a sort of Supreme Court of Justice. A few weeks later the Constitutional Court upheld the decision of the National Court of Justice.
To be sure, the Ecuadorian Constitutional Court that upheld that decision was not what one would expect from a real constitutional Supreme Court. Members of the Constitutional Court who made that decision were tied to Correa and obviously responded to his wishes. Indeed, the Constitutional Court never declared unconstitutional any of Correa’s decrees even though they clearly reflected arbitrary and abusive use of executive power. The Constitutional Court also ignored multiple requests and petitions presented by citizens demanding respect for their rights.
Interestingly enough, this is why a month after the Constitutional Court issued its decision on Chevron, the nine justices of the constitutional court were removed by the transitory Citizens Participation and Social Control Council. The allegations were mostly that the justices had conflicts of interest given their ties to the former president. The removal of the justices is compatible with the actions of the administration of the current Ecuadorian president Lenin Moreno who seems to be eager to slowly remove Correa’s influence from the state apparatus.
Indeed, the PCA in its recent decision on Chevron clearly stated that the Ecuadorian judge that handled the case received bribes. Likewise, he allowed the plaintiffs to “ghostwrite” his decision. The plaintiffs acted with the help of an American attorney Steven Donziger who was instrumental in the corruption scheme.
That view was also held by the U.S court system. In March 2014, a U.S court ruled in favor of Chevron, citing the fact that lawyers for the Ecuadorian plaintiffs had used fabricated evidence, bribed judges and ghost-written court documents. The plaintiffs were therefore barred from collecting the money from Chevron. In August 2016, a US court of appeals agreed with the lower court’s ruling reaffirming its arguments regarding corrupted practices. The plaintiffs appealed to the U.S Supreme Court early in 2017 requesting to overturn the decision but the highest court refused to hear the petition.
Donziger’s license to practice law was suspended as part of the decision of the U.S court of appeals.
The PCA ordered the government of Ecuador to take steps to remedy the situation and compensate Chevron for the fraudulent scheme it was subjected to.
Interestingly enough it was also found that celebrities such as Mia Farrow and Danny Glover were used to support the cause of the plaintiffs and received handsome amounts of money to do so, allegedly from the Correa government.
The Chevron case is not merely a case of litigation over environmental and pollution issues. It uncovers the power of corruption in countries where the leadership has no respect for the rule of law. Corruption is an issue that has become prominent in Latin America as it is generating mass protests. Judges are now beginning to take this issue seriously as it is happening in countries such as Brazil.
Corruption has made state and government institutions into instruments of organized crime and drug cartels and as such, extremely dangerous to citizens’ security. Corruption makes the region unsafe for foreign investment and it hurts American companies that by law cannot engage in bribery or illegal acts.
The current Ecuadorian president Lenin Moreno has an opportunity not only to uphold the decision of the PCA but by doing so he would add to the effort to restore law and order to Ecuador. Lenin Moreno already expressed his support for the PCA’s decision. However, several members of his cabinet refuse to do so. Mr. Moreno is making efforts to change the system and we give him full credit for this. However, he has a difficult task since he cannot get rid of all the apparatus built by 10 years of Correa’s semi-authoritarian rule.
Chevron had the fortune of having the means to fight and expose this perversion of justice. Most individuals do not have such resources. When the rule of law is broken, it is more likely that the small citizens and the powerless could turn into victims. Therefore, the Ecuadorian government must accept the PCA decision on Chevron in order to protect not only its international credibility but also the very law that will provide justice to its own citizens.
THE AMERICAS REPORT
NANCY MENGES and
LUIS FLEISCHMAN, Editors
The Americas Report is the featured product of the Center for Security Policy‘s Menges Hemispheric Security Project. It features in-depth, original articles on subjects not regularly covered by the American press.
Search The Americas Report
Browse By Topic
- Central American Countries (13)
- Latin American Countries (316)
- Middle East (29)
- Podcast (1)
- #Argentina Salir de la locura – por Carlos Mira August 31, 2018De nada sirve decir “se los dije”. Cuando el agua le llega a uno al cuello, todo ese tipo de “reverberancias” ya no aportan ninguna solución. Pero lo que ocurre es que el gobierno, por sus principales figuras es el que está diciendo: “me lo dijiste”. Haber mentido en el instante de mayor poder de […]
- #Bolivia Socialismo Siglo XXI…OTRO MÁS que toma el camino de la DICTADURA August 24, 2018El 21 de Febrero de 2016 el pueblo de Bolivia dijo NO a la cuarta reelección de Evo Morales en un referendum del que participaron todos los bolivianos. Sin embargo, Morales ahora busca desconocer la voluntad de su gente, volviendo a presentarse como candidato. Una decisión que establece formalmente una dictadura en Bolivia. Para de […]
- #Argentina Queremos flan – por Fernando Iglesias August 22, 2018“Vamos a decir la verdad: a vos se te prendió fuego la casa, afuera hace frío y tenés 12 hijos. Entonces vienen los 12 y te dicen: ¡Queremos flan! ¡Queremos flan, papá! ¡Flaaaaaaannn! Y cuando vos intentás explicarles que unos HdP le prendieron fuego a la casa, ellos te contestan que no es cierto, que […]
- #Nicaragua OEA condena violaciones de DDHH y exige elecciones anticipadas July 19, 2018La OEA condenó este miércoles las violaciones a los derechos humanos cometidos por la policía y paramilitares del régimen, desde que comenzaron a mediados de abril, las protestas pacíficas contra el autócrata Daniel Ortega cuya represión ya lleva 350 muertos y 2.000 heridos, habiendo ausencia de libertad de expresión, y denegación de atención médica a heridos. […]
- #Ecuador ¿Se enfría la economía ecuatoriana? – por Jorge Calderón Salazar July 17, 2018Días atrás culminó la visita del Fondo Monetario Internacional y durante la cual se reunió con varios representantes tanto del sector público como privado, pero más allá de este proceso iniciado meses atrás por el gobierno en aras de tender puentes con este organismo multilateral y mejorar así de a poco su imagen en los […]
- #Nicaragua EL PODER… sin importar la sangre que se tenga que pagar July 2, 2018Daniel Ortega autoriza ingreso de tropas de Cuba y Venezuela a Nicaragua. La mayoría del Parlamento de Nicaragua autorizó este viernes el ingreso de tropas y medios extranjeros entre julio y diciembre de 2018 con fines humanitarios, a pesar de que la oposición lo consideró “imprudente” en medio de la represión contra las protestas antigubernamentales. […]
- #Mexico Elecciones: Inversores aterrorizados mientras izquierda celebra a López Obrador July 2, 2018Nicolás Maduro, Dilma Rousseff, Cristina Fernández de Kirchner, Gustavo Petro, Rafael Correa y Pablo Iglesias, dirigentes políticos de la izquierda de América Latina y España, han apoyado primero y luego felicitado a Andrés Manuel López Obrador, por su triunfo en las elecciones presidenciales en México con el 53% de los votos. Inversores aterrorizados por las perspectivas […]
- #Colombia Contundente triunfo del sentido común: Iván Duque es el nuevo presidente June 17, 2018Con tan sólo 41 años y excelentes propuestas para el futuro de Colombia, Iván Duque, el candidato del Centro Democrático, se impuso sobre el ex terrorista del M19 Gustavo Petro, en segunda vuelta electoral por 54% a 42%. Duque asumirá el poder hasta el año 2022. Colombia celebra un nuevo triunfo del uribismo sobre el […]
- #Bolivia Evo Morales llega a Rusia: ¿Cumbre con Putin o viaje gratis al mundial? June 14, 2018El canciller boliviano, Fernando Huanacuni Mamani anunció que Evo Morales, presidente del narcoestado boliviano, se ha reunido ayer con Vladimir Putin en Rusia para gestionar USD 1.000 millones en inversiones. Pero la oposición denuncia que este viaje, que costará USD 340.000 en fondos públicos, sirve de excusa para que el gran jefe cocalero no se pierda la […]
- #Venezuela Lech Walesa: “Venezuela está secuestrada por un grupo de neo traficantes y terroristas” June 13, 2018Lech Walesa, líder polaco de la revolución de terciopelo en Europa, sostuvo que Venezuela está secuestrada por “un grupo de neo traficantes y terroristas” y “que más temprano que tarde, deberá ser intervenida por fuerzas de coalición internacional para preservar la paz mundial”. Las declaraciones del expresidente de Polonia fueron reflejadas por Antonio Ledezma en […]
- #Argentina Salir de la locura – por Carlos Mira August 31, 2018
- Niños del Estado Islámico asesinan a 25 soldados siriosYihadistas publican video donde aparecen las víctimas de rodillas y en fila en el escenario del teatro romano de Palmira
- Fidel reaparece en reunión de maestros queserosSostuvo un amplio intercambio de más de cuatro horas con 19 maestros queseros en un instituto en el poblado del Guatao
- Enrique Iglesias complace a miles de fansCon I like it, el cantante finalizó su concierto de anoche
- Kutcher y Mila Kunis se casarían este fin de semanaSegún el portal estadounidense Page Six, la pareja dará el sí en una ceremonia privada en Los Angeles
- Niños del Estado Islámico asesinan a 25 soldados sirios