In April 2007, New York lawyer Steven Donziger flew to Ecuador convinced he was on the brink of victory against a formidable foe — Chevron Corp.
He had spent years suing America’s second largest oil company for allegedly polluting the streams and soil of Ecuador’s rain forest and poisoning the people who lived there.
The fight, waged in the courthouse of a small town named Lago Agrio, had turned into an international cause celebre, closely watched by environmentalists and oil executives alike. A documentary film was in the works, with a camera crew shadowing Donziger and his team.
Chevron, based in San Ramon, had fought back hard. But now lawyers representing the company were discussing a settlement. Although not all of his colleagues agreed, Donziger wanted to push for at least $1 billion, maybe even $3 billion, to pay for cleaning up the contamination. As he flew south, he believed a historic achievement lay within reach.
“I cannot believe what we have accomplished,” Donziger wrote in a diary he kept of the suit. “Important people interested in us. A new paradigm of not only a case but how to do a case. Chevron willing to settle. Billions of dollars on the table. A movie, a possible book. I cannot keep up with it all. Just four years ago I felt broke and hopeless, unable to gain traction.
“I cannot wait to get off the plane and see my fellow soldiers — often the only people I feel who get me,” he continued. “I want to look in their eyes and see if they understand the enormity of what this team has accomplished.”
Trial starts Tuesday
A settlement was never reached. And on Tuesday Donziger will go on trial in New York, accused by Chevron of masterminding a massive judicial fraud.
Although Donziger and his team prevailed in Ecuador, winning a $19 billion judgment against the company, Chevron claims that Donziger and his colleagues repeatedly tampered with the court process, eventually bribing a judge and ghostwriting the judgment itself.
To prove its case, Chevron will use outtakes from the documentary film as well as many of the team’s internal e-mails and memos. Chevron will also use Donziger’s diary, wrested from him under a court order.
Running from September 2005 to May 2007, the 109-page diary details Donziger’s strategies, impressions, hopes and fears about the long-running case. And it presents a paradox.
Some passages seem to back Chevron’s claims of judicial tampering, although not of bribery. At the same time, Donziger never expresses doubt about the suit itself. Throughout the diary, he appears convinced that the residents of Ecuador’s oil patch suffered a massive injustice, and that Chevron bears the responsibility.
“This is about being alive, about exercising the human will against all odds for something you believe in,” he wrote in October 2005. “I really feel this is not my property, not my case; I am just part of a larger legal team, and bigger than that, part of a larger political struggle involving thousands of people.”
To Chevron, the diary presents ample evidence of wrongdoing. The company has focused in particular on sections it says show Donziger trying to pressure judges and manipulate a court-appointed expert who was supposed to remain independent. Lawyers representing Chevron in the upcoming trial will also present testimony from a former Ecuadoran judge as well as some of Donziger’s former contractors who have since switched sides.
“It’s a cascade of damaging evidence of fraud and racketeering that we’ll be putting out during the trial,” said Ted Boutrous, a partner with the law firm Gibson, Dunn & Crutcher, representing Chevron. “If you looked at this evidence, any reasonable person would determine this judgment is corrupt and the product of fraud.”
The Ecuador lawsuit has a long and tortuous history.
Its origins stretch back to 1964, when Texaco started drilling for oil in Ecuador’s northeastern corner, a region known as the Oriente. The American company, which Chevron bought in 2001, worked in partnership with state-owned Petroecuador.
In 1992, Texaco pulled out, turning over oil-field operations to its partner. Texaco then reached an agreement with the government in 19 to clean up a portion of the area for $40 million, leaving the rest to Petroecuador.
Even before the agreement was signed, residents of the Oriente sued Texaco in New York, saying the years of drilling had contaminated their home. Texaco, and later Chevron, fought successfully to move the case to Ecuador.
Donziger, a former journalist and public defender, worked on the case during the 1990s, but only in a supporting role. He became far more involved once the lawsuit moved to Lago Agrio in 2003.
His diary includes graphic, angry descriptions of people living among polluted streams and soil. At one point, he visits an old oil-producing site and finds a system “designed” to dump drilling wastewater, laced with oil and chemicals, into a nearby stream. He compares the wastewater system to “pre-meditated murder.”
And yet, for all the confidence he shows in his cause, Donziger often expresses doubt that he and his team — a collection of American and Ecuadoran lawyers and activists — will ever win.
He describes an Ecuadoran legal system full of weak judges who only respond to pressure and fear. He constantly worries that Chevron — which he sometimes refers to as Texaco or Tex — will simply bribe a judge to kill the case.
“Tex is influencing the court,” he writes in February of 2006. “Pablo (Fajardo, one of the lead lawyers on his team) told me the judge is a womanizer, drinker and vago (a lazy bum) — just the perfect psychological profile for blackmail and corruption. Tex must be loving it.”
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He also makes allusions to receiving death threats, says people are following him and his colleagues in the street and sometimes wonders if their phones have been bugged.
(“If he has evidence to support any of these baseless allegations, he’s not presented it,” Chevron spokesman Morgan Crinklaw said in response.)
To win, Donziger keeps his team on the offensive. He and his colleagues try to make allies within Ecuador’s federal government, both before and after the election of leftist President Rafael Correa. They meet frequently with the rotating cast of judges presiding over the lawsuit, sharing meals and drinks and urging them to speed up a court process Donziger finds agonizingly slow.
‘I am good at it’
“I love it — this lobbying,” Donziger writes after lunching with a judge in March 2006. “I am good at it. But I hate it, hate that it is necessary, hate that it is part of the legal culture. … I think it runs counter to any good person.”
It certainly irked Chevron. The company has often complained about Donziger and the other Lago Agrio lawyers conferring with judges out of court, with no Chevron lawyers present. But until recently such meetings were legal in Ecuador. The country adopted a law barring that behavior in 2009.
That kind of intense, personal lobbying extended to the selection of a court-appointed expert to prepare a damage assessment in the case, a person known as the “perito.” Donziger angled to have the presiding judge pick someone that the Lago Agrio lawyers had already vetted and approved. At one point, Donziger describes interviewing one engineer and asking if he could stand up to Chevron.
“I asked if he could be comfortable slamming them with a ($10 billion) judgment,” he wrote in December of 2006. “He answered yes … but I don’t know if he has the internal timber to pull it off.”
‘Play ball with us’
Then he added, “he has to totally play ball with us and let us take the lead while projecting the image that he is working for the court.”
In another passage, he wonders, “How are we going to do and write the Global (damage assessment) in 120 days?”
Chevron found such comments revealing. The company would later accuse Donziger and his team of conspiring with the man who would eventually be named perito, Richard Cabrera. The team’s consultants, according to Chevron, ghostwrote Cabrera’s damages assessment, which found widespread contamination. Those consultants, from a firm called Stratus, have since given Chevron sworn testimony claiming they wrote the report. They have also disavowed its findings.
Donziger and his colleagues have long maintained that they were free to submit their own data and analysis to Cabrera, and he was free to use it. Chevron, they say, could have done the same. And indeed at one point in the diary, Donziger writes, “Texaco will have an equal right to pressure and manipulate the perito.”
The diary ends
In the end, the Ecuadoran judge who ruled against Chevron — Judge Nicolas Zambrano, who issued his judgment in February of 2011 — chose not to rely on Cabrera’s report, due to the controversy. The diary ends before Zambrano, the judge Donziger is accused of bribing, took over the case.
A representative for Donziger acknowledges that the “let us take the lead” comment referring to the perito is problematic.
“Certainly, the way it’s worded, we would have loved to have had him word it differently,” said Christopher Gowen, a lawyer on the team defending Donziger in the upcoming fraud case. “But what he meant was, he wanted to make sure there’d be someone in the court who would give him a fair trial. He felt that every single person in the court system was against us and was going to be corrupted.”