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Chevron’s Lawsuit in Ecuador – background

By David M Handelman On February 26, 2009 No Comments

 

The ongoing class action lawsuit between 30,000 Ecuadorian villagers and Chevron Texaco, (Aguinda vs ChevronTexaco) is one of the most historic and important lawsuits of our time, in my opinion. It may the first time that a large multi-national US corporation is held accountable for irresponsible environmental action overseas. Chevron may be held accountable for cleaning up the spilt oil and waste pits left behind after their operations, as well they may be held accountable for damages to the people of the area as they have seen an increased number of illnesses and cancer. The following is some backgound information about Texaco’s operations and the lawsuit itself:

  • Texaco had an oil concession in Ecuador for over 20 years
  • In a cost saving measure, Texaco decided not to re-inject toxic water, ”formation waters” brought up in the drilling process despite the fact that this was the industry standard at the time.  It is estimated that this may have saved $3 per barrel of oil.
  • Texaco left hundreds of unlined open pits of this toxic waste.
  • The plaintiffs allege that Texaco also dumped over 18.5 million gallons of oil directly into the forest over the time frame of their operations

Details about the Lawsuit

  • In 1993, a class action lawsuit was filed against Texaco, now Chevron, under the Alien Tort Claims Act in a US federal court in New York on behalf of an estimated 30,000 Amazon residents for polluting their environment
  • The judges in the US, in agreement with requests by Chevron, decided that the lawsuit should be tried in Ecuador, and that the decision of the Ecuadorian court would be binding in the US
  • The court in Ecuador ordered inspections of the open pits and other areas that the plaintiffs are claiming as hazardous.  Both sides call in to question the validity of the other’s sampling and testing.  However, the evidence shows that levels of harmful chemicals in many of the areas are significantly higher than Ecuadorian laws allow (as well as US law permitted levels). 
  • Some information from one sample reading:  Sacha 53 site -  TPH (Total Petroleum Hydrocarbons) were 1005 times the permitted level – and these include many cancer causing chemicals.  Chromium 6 was six times above allowed limits, cadmium and phenol at 9 times legal limits and lead at 3 times the legal limits.
  • Despite laws that were passed in the states of Louisiana, Texas and California requiring careful handling of toxic formation water, prior to Texaco’s operations in Ecuador, Texaco chose not to follow the industry standards in Ecuador, even while they did follow the same standards  in the US.  This choice not to handle the toxic waste as safely as possible was also in violation of a 1971 law passed in Ecuador. Please read below:

Ley de Hidrocarburos (1971) “contractors are compelled to: e) employ modern, and efficient machinery; s) adopt all necessary measures in order to protect all animal and plant life, as well as other natural resources; t) avoid water, atmosphere and soil pollution”;

  • The court appointed scientist and his team now estimate that the judgment should be for $27 Billion to cover all the costs of clean up and for damages and health problems.

Current State of Affairs

·          The historic decision is expected sometime in 2009.

·         Chevron now claims that the court in Ecuador is unjust and biased against them.  They claim that the court appointed scientist has a disdain for science.  (Isn’t it funny how Chevron argued at one point that the court in Ecuador is fair and just to oversee this case?) They are calling for dismissal of the entire case to avoid any liability.  Chevron also accuses the Ecuadorians of a money grab, and a biased campaign against them.

·         Chevron has taken other outside measures to pressure the Ecuadorians.  This includes lobbying the US government for assistance against the Ecuadorians.  Chevron has even called for the US government to revoke Ecuador’s preferential trade status due to this case.  Unfortunately for Chevron, sentiments have turned against them in Washington.

 

 

 

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