From Cadwalader, Wickersham & Taft LLP, analysis of two recent judicial decisions in the long-standing Lago Agrio dispute between Chevron and plaintiffs in Ecuador suing the global energy company for environmental contamination.
The first looks at an appellate decision in Ecuador that affirmed an $18 billion judgment against Chevron:
“… we are not certain how to square the decision with the 2011 decision of the international arbitration unit at the Hague, which directed that, under the U.S.-Ecuador Bilateral Investment Treaty, Ecuador was required to take all measures at its disposal to prevent enforcement of the Lago Agrio judgment until further order of the Tribunal. The arbitral Tribunal also recorded (this according to Chevron’s press release but confirmed in various of the decisions on the subject) that if it were established that any judgment made by an Ecuadorian court in the Lago Agrio case was a breach of an obligation Ecuador owed to Chevron as a matter of international law, any loss arising from the enforcement of such judgment (within and without Ecuador) may be losses for which Ecuador would be responsible to Chevron under international law.”
The second discusses an Eastern District of California ruling denying Chevron efforts to block the testimony of Douglas MacKay, a professor at the University of California at Davis, in the (separate) international arbitration between Chevron and the Republic of Ecuador:
“Chevron’s opposition is based on the allegation that the non-U.S. proceeding is a sham, ‘contending the foreign court was neither independent nor impartial’. The District Court applied Section 1782 as written and broadly… The Court denied Chevron’s application to stay [the discovery]. Said the Court, it was not willing to ignore the governing factors by indulging in a discussion of what effect its ruling would have on the efficient disposition of the non-U.S. proceeding…”