Monday, January 30, 2012

Environmental Law/International Law: Developments in Chevron Challenge to $18 Billion Dollar Judgment in Ecuador

On January 3, Chevron Corporation issued a press release reporting that a three-judge panel of "temporary judges presiding over appellate proceedings in the Provincial Court of Justice of Sucumbíos in Lago Agrio, Ecuador in an environmental lawsuit involving Texaco Petroleum Company," had ruled against the companies.  The appellate court's ruling upheld a February 2011 lower court ruling that awarded more than $18 billion -- nearly nearly half of of which constituted punitive damages -- against the companies for what Chevron described as "alleged environmental and social harms in the Amazon region of Ecuador."  Shortly before the appellate court ruling, Chevron had sent a letter to the Ecuadorian Prosecutor General alleging fraud and corruption in the litigation.
Although Chevron sought immediate relief in the U.S. District Court for the Southern District of New York, that court reportedly denied Chevron's request for an order of attachment.  On January 25, a panel of arbitrators at the Permanent Court of Arbitration in The Hague issued an order that directed the Government of Ecuador to "take all measures at its disposal to suspend or cause to be suspended the enforcement or recognition within and without Ecuador of any judgment" against Chevron in the case pending further order or award from the tribunal.

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