Chevron: Lawyers seeking to 'pressure' firm into settlement

Chevron, responding to a letter from New York Atty. Gen. Andrew Cuomo demanding financial information for company shareholders, said the request results from a campaign by lawyers conducting a lawsuit.

May 8th, 2009

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, May 8 -- Chevron Corp., responding to a letter from New York Atty. Gen. Andrew Cuomo demanding financial information for company shareholders, said the request results from a campaign by lawyers conducting a lawsuit against the major.

"We presume the inquiry is a result of a campaign by the American trial lawyers," said Chevron spokesperson Kent Robertson, referring to a lawsuit filed on behalf of residents of the Amazon rainforest over environmental damage and alleged cancer deaths they blame on oil spills and water contamination.

The Chevron spokesperson, who acknowledged that the firm had received the letter and would respond, told OGJ that the American trial lawyers behind the case were seeking "to pressure" the firm into a settlement.

"We have communicated fully with stockholders about the Ecuador case and we will continue to do so in the future," he said. "We believe stockholders will be better served by the successful resolution of this case rather than paying a windfall to a group of American trial lawyers and lobbyists."

Ecuadoreans claim that Texaco Inc. dumped toxic wastewater from drilling operations into unlined waste pits to save money and that that Chevron, which acquired Texaco Inc. in 2001, is financially liable for the damages.

The case, which is now being tried in an Ecuadorean court, could result in Chevron paying $27 billion in damages—a matter of potential concern to shareholders.

"In recent weeks, we have received complaints regarding Chevron's disclosures of the potential litigation risks and Chevron's characterization of available legal defenses," Cuomo wrote in his May 4 letter.

"Given the fact that both New York State and New York City public pension funds hold substantial Chevron shares and that many New Yorkers are also shareholders (including Amnesty International USA), this office has an interest in ensuring that public statements about the litigation are accurate and complete," Cuomo said.

"Shareholders also have a right to know what contingencies, if any, have been taken by Chevron in recognition of a possible adverse ruling in the litigation," Cuomo said, adding that, "This office has an interest in ensuring that public statements about the litigation are accurate and complete."

Contact Eric Watkins at hippalus@yahoo.com.

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