Thu, Nov 14, 2013 - Page 15 News List

Chevron ordered to pay Ecuador US$9.51 billion

STILL STEEP:The court reduced the fine from US$19 billion, but the firm is trying to prevent the plaintiffs from using US courts to force it to pay


An Ecuadoran court on Tuesday upheld a ruling that US oil giant Chevron was liable for environmental damage in its Amazon basin region by sister company Texaco, but ordered it to pay a reduced US$9.51 billion.

The Ecuadoran Supreme Court upheld a 2012 ruling against Texaco, which operated in the South American nation from 1964 to 1990, but dramatically reduced the amount to be paid in damages to US$9.51 billion from US$19 billion, the ruling said.

Just last month, Chevron was in court in New York trying not to pay the damages.

Chevron wants a New York district judge to prevent lawyer Steven Donziger, Ecuadoran villagers and environmental activists from using the US courts to force Chevron to pay its fine.

A court in Ecuador first had ordered Chevron to pay US$18 billion in damages, which was later raised to US$19 billion, to people from Lago Agrio in Sucumbios Province, in the Amazon basin region for environmental damage.

However, Chevron has almost no assets in Ecuador and is resisting attempts by the original plaintiffs to use US courts to force its US operation to pay up. Chevron has never worked directly in Ecuador, but inherited the pollution lawsuit when it acquired former rival Texaco in 2001. It is fighting against having to pay the fine.

The New York case is the latest in years of litigation over pollution attributed to Texaco Petroleum, which worked in the Amazon from 1964 to 1990.

Thousands of villagers say they were sickened and many have cancer from the oil spillage’s effect on their water supply.

The case could have implications for lawsuits in Canada and Brazil, where the plaintiffs are going after Chevron’s assets.

Commentators say the case could help to determine the extent to which US courts can pass judgement on alleged misconduct of US multinationals abroad.

In the US District Court in New York, Chevron is alleging fraud and violations under the Racketeer Influenced and Corrupt Organizations Act. Chevron maintains that Ecuador and its state oil company should pay the damages.

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