Chevron's arbitration move called 'forum shopping'

HOUSTON, Sept. 25 -- Lawyers for Ecuadorian plaintiffs in an environmental lawsuit against Chevron Corp. have dismissed the company’s filing of an international arbitration claim as “forum shopping” (OGJ Online, Sept. 24, 2009).

Steven Donziger, a New York lawyer representing the Amazon communities suing Chevron, made the statement while calling the company’s move “one of Chevron’s last cards to avoid paying for a half-century of environmental contamination in Ecuador’s Amazon.”

The lawsuit started in 1993, targeting Texaco Petroleum (Texpet), a member of a consortium that had produced oil under a concession that ended in 1992. State-owned Petroecuador replaced Texpet as operator in 1990.

Chevron, which took over Texpet’s parent Texaco Inc. in 2001, says it is being held accountable for environmental damaged caused by Petroecuador. It says Texpet spent $40 million on environmental clean-up and received a release of liability from the Ecuadorian government before leaving the country.

It further alleges corruption of the Ecuadorian judicial system. The lawsuit will be decided in a court in the small town of Lago Agrio.

Damage claims, based on estimates by a court appointee, exceed $27 billion.

Donziger, a law school friend of and fund-raiser for US President Barack Obama, said Chevron’s filing for international arbitration will not affect the legal case.

He listed legal decisions against Chevron, saying they “help explain the company’s timing in filing the arbitration claim.”

And he said outcome of the arbitration move won’t affect plans to seize Chevron’s assets if the company loses the lawsuit.

“This could end up being one of the biggest forced asset seizures in history, and it could have a significant disruptive impact on the company’s operations,” he said.