On July 7, the Amazon Watch partner organization the Amazon Defense Front (Frente de Defensa de la Amazonia) scored an imporant victory in its the case against ChevronTexaco’s polluting their forests and communities. The Frente and 80 of its members (people affected by ChevronTexaco’s toxic contamination in the Amazon) marched in the streets in the Ecuadorian capitol of Quito and peacefully occupied two ministries in one day – Commerce and Justice, forcing the Attorney General and the Minister of Foreign Trade to take a stand against ChevronTexaco and for the people of Ecuador.
The morning began with a meeting with the President of the National Congress of Ecuador to voice concerns over ChevronTexaco’s malicious tactics to discredit the lawsuit brought against it by affected communities (please see http://www.amazonwatch.org/amazon/EC/toxico/ for more information) and to ask for support. The Frente was particularly concerned about the arbitration claim filed by ChevronTexaco on June 11th, 2004 in New York. This claim was filed by CVX in an attempt to transfer environmental responsibility of Texaco, now ChevronTexaco, to the Ecuadorian state-owned company, Petroecuador. (See below for more background on the arbitration claim.)
The Frente then gathered with supporters and marched on the office of the Attorney General, José Ramón Borja. After a two-hour occupation that led to a meeting, the Attorney General issued a statement and letter to Jones Day, ChevronTexaco´s law firm in the United States stongly rejecting the arbitration claim filed by ChevronTexaco. The Attorney General announced that “Ecuador will never submit to a foreign court (in the United States)”. By doing this, the Attorney General discredited ChevronTexaco’s attempts to pressure the Ecuadorian government and undermine the litigation filed by Amazonian peoples in Ecuador.
The Frente and its supporters in Quito then marched to the office of Ivonne Baki, Minister of Foreign Trade. She has been accused of orchestrating the arbitration claim with ChevronTexaco, with the goal of dismissing the case in Ecuador. For this reason, the Frente was calling for her resignation. After several hours of peacefully occupying the office lobby, Minister Baki came out and pledged to never again interfere with the legal case, whether through the Andean Free Trade Agreement negotiations, by helping ChevronTexaco with its arbitration or any other matter. She also promised to visit the Amazon as a guest of the Frente to see the damage firsthand. By doing this, she has sent a strong message to other Ecuadorian government officials who may consider working behind closed doors to help ChevronTexaco.
With these victories, the Frente hopes that the Ecuadorian government will respect the legal process underway to hold ChevronTexaco accountable for damages caused in the Amazon and support the local peoples’ right to a clean and healthy environment.
Representatives of the Frente had a press conference the same day announced that its members will now prepare for the judicial inspections expected to begin by early August. The judicial inspections will be conducted by Efrain Novillo, the President of the Superior Court in Lago Agrio, Ecuador. He will be accompanied by environmental remediation experts, lawyers and community members. A decision in the case against ChevronTexaco in Ecuador will be announced after the inspections.
Background on Arbitration Claim Against Petroecuador
On June 11th, 2004, ChevronTexaco filed an arbitration claim against Petroecuador, Ecuador’s state-owned oil company, “to fulfill its obligation to indemnify ChevronTexaco for any and all claims, including environmental claims, arising from TexPet’s (Texaco subsidiary) role as operator in a former oil production consortium with Petroecuador,” according to a company press release on June 15th, 2004.
What does this mean?
ChevronTexaco is, once again, trying to find a way to release itself from legal and ethical responsibility to clean up the disaster area Texaco created in the Amazon (ie…ChevronTexaco is feeling the pressure in Ecuador and wants the case against it to be dropped). By filing the arbitration claim in New York, ChevronTexaco is trying to pressure Petroecuador, the Ecuadorian government and the Ecuadorian judicial system to respond in its favor. This is an attack on the Ecuador’s sovereignty! ChevronTexaco is trying to pressure the Ecuadorian government to submit itself to arbitration in the US, which it does not have to do according to Supreme Court Ruling DOLE Food Co. v. Patrickson (April 22, 2003). The DOLE decision says that companies that are fully owned by a government do not have to submit themselves to US Courts.
The filing of this arbitration claim is worrisome for the following reasons:
• CVX continues to claim that TexPet was a minority partner, so it should only have a minority responsibility in the clean up;
• CVX claims that its remediation measures were adequate. It is also trying to put the blame on Petroecuador;
• Petroecuador does not have the assets to pay for costs incurred by ChevronTexaco and/or its subsidiaries relating to the legal case in Ecuador;
• If brought to the American Arbitration Association, the judgement is legally binding and could destroy the case against ChevronTexaco in Ecuador;
• If the Ecuadorian government accepts arbitration, it cannot request an appeal in US Federal Courts and;
• This claim comes at a time when the Ecuadorian government is seeking trade negotiations with the United States under the Andean Free Trade Agreement. CVX’s legal counsel, Ricardo Reis-Veiga has stated that this case must be resolved before trade negotiations are to begin with Ecuador.
Background
Texaco, now ChevronTexaco, created the infrastructure for the oil industry in Ecuador. It built the wells and pipelines, and made the operating decisions on how wastewater was to be treated. Texaco executives in New York, at the time, made the decisions to not re-inject highly toxic wastewater into the ground, thereby dumping the water into waste pools which leached, and continue to leach, into nearby rivers and streams. This toxic dumping has resulted in one of the most horrible environmental disasters known to man and ChevronTexaco is responsible.
In 1999, Petroecuador and the Government of Ecuador agreed to absolve TexPet of further liabilities if it “remediated” a portion of the affected areas. ChevronTexaco claims that it has met its obligations to remediate the contaminated areas, but Petroecuador has not (met its obligations under the Joint Operating Agreement- JOA). According to the people affected by ChevronTexaco’s operations, the remediation conducted prior to the 1999 agreement was unsatisfactory. Contaminants continue to leach out from waste pools which are considered to be “remediated”, for example. In October 2003, a Study of Texaco’s former operations , conducted by the Amazon Defense Front (Frente de Defensa de la Amazonia) in conjunction with Petroecuador, found that only 17 of the remediated waste pools were “well remediated”. 194 were poorly remediated.
By signing an “agreement’ with a corrupt government (at the time), ChevronTexaco believes that it no longer has a responsibility to the people or the environment of the Oriente region. To the 30,000 people who live adjacent to toxic waste pits and drink contaminated water, ChevronTexaco still has a major responsibility in the area…to clean up the toxic mess it left. No agreement, lawsuit or claim will clear ChevronTexaco of its fundamental responsibility to Cleanup Ecuador!
Other considerations…
Texaco claims that the Ecuadorian Government signed an Investments Protection Convention with the United States in 1997 and wants to be protected, although it claims to already have been out of the country at the time (from Accion Ecologica).
Texaco and ChevronTexaco appealed the court in New York for 9 years to have the case moved to Ecuador, since TexPet was there. Now, ChevronTexaco wants the American Arbitration Association in New York to review their claim (from Accion Ecologica).
Arbitration is not mediation. Arbitration is legally binding and decisions are final. This is not a just and transparent way to deal with this matter. The courts in Ecuador should make the final decisions based on factual evidence, not political and corporate pressure.
The Supreme Court has ruled that wholly owned corporations of foreign governments are immune to lawsuits in American Courts. This is the case for PetroEcuador. PetroEcuador does not have to respond to any lawsuit ChevronTexaco may bring in the US for any reason (DOLE v. Patrickson).
WHAT YOU CAN DO:
1. Call, Fax or Write to ChevronTexaco’s CEO, David O’Reilly
*Let him know that you are disappointed with ChevronTexaco’s recent attempts to discredit the Ecuadorian judicial system by filing the arbitration claim against Petroecudaor in New York. CVX’s threats will not halt the truth.
Mr. David J. O’Reilly
Chairman and CEO
ChevronTexaco Corporation
6001 Bollinger Canyon Road
San Ramon, CA 94583
Tel: 925-842-3232
Fax: 925-842-1230/925-842-6047
comment@chevrontexaco.com
2. Call, Fax or Write to ChevronTexaco’s Corporate Social Responsibility representatives:
*Let them know that it is not socially responsible to continue delaying the clean up of the waste Texaco left in Ecuador. It is not responsible for the company to keep blaming Petroecuador for fatal decisions that were made by Texaco in the United States.
Chris Gidez
ChevronTexaco
Policy, Government & Public Affairs
203-256-5758
gidezcr@chevrontexaco.com
Stephen Burns
Former Manager of Corporate Social Responsibility
202-408-5858
stephen.burns@chevrontexaco.com
Maripat Sexton
Regional Manager
Public Affairs, Latin America
713-752-6665
sextomp@ChevronTexaco.com
Valerie Crissey
Corporate Responsibility Coordinator
ChevronTexaco Corporation
6001 Bollinger Canyon Road, A2084
San Ramon, CA 94583
Tel: 925.842.3542
Fax: 925.842.3610
VCrissey@chevrontexaco.com
Christina Jones
General Manager, Corporate Public Policy
Policy, Government and Public Affairs
6001 Bollinger Canyon Road, Room A2076
San Ramon, CA 94583-2324
Tel: 925- 842-0180
Fax: 925-842-0690
cjones@chevrontexaco.com
