Courtroom drama

“THIS case is extraordinary. The facts are many and sometimes complex. They include things that normally come only out of Hollywood.” So wrote Lewis Kaplan, an American federal judge, in a gripping, John Grisham-esque 485-page verdict on March 4th. It found that a controversial multi-billion-dollar judgment in Ecuador against Chevron had been “obtained by corrupt means”, lambasting Steven Donziger (pictured), the prominent New York lawyer who had brought the case against the oil giant.

The ruling, in a civil case brought by Chevron, provides a large measure of vindication for the firm, which opted to fight rather than bow to the usual pressure on big businesses to minimise bad publicity by accepting an out-of-court settlement. In 2011 an Ecuadorean court had ordered it to pay $19 billion—later reduced to $9.5 billion—to clean up environmental damage in the Lago Agrio oilfield in the Amazon region. This was allegedly done, more than 20 years ago, by an arm of Texaco, a smaller firm Chevron bought in 2001. Its supposed responsibility for miserable conditions experienced by rainforest dwellers has become a pet cause of celebrities such as Mia Farrow and Trudie Styler, environmental groups and Rafael Correa, Ecuador’s president. (An earlier Ecuadorean government had declared that Texaco had shed its legal responsibility by cleaning up the affected areas.) Last October Mr Correa accused The Economist of “barefaced lies” and of acting on behalf of Chevron because of our reporting of the case, allegations that we reject firmly.

Mr Kaplan delivered an eviscerating commentary on the actions of Mr Donziger and two of his Ecuadorean clients. The three, he ruled, will not be allowed to benefit in any way from the verdict they “obtained by corrupt means” in Ecuador. Among other things, the judge found that fraudulent evidence had been submitted to the Ecuadorean court; the main “independent” expert advising it was secretly in the pay of Mr Donziger’s team; one Ecuadorean judge had been coerced and another bribed; American judges had been intimidated; and Mr Donziger and his clients controlled the body to which the damages were ordered to be paid.

The judge described Mr Donziger as in “ultimate command” of a criminal “enterprise” that also included environmental groups and public-relations, law and consulting firms, that sought to use a high-profile campaign of false allegations to extort money from Chevron.

Mr Donziger plans to appeal against the ruling. He says it relied on evidence from an Ecuadorean judge who has admitted being paid by Chevron. Mr Kaplan’s ruling accepts that there are credibility issues with that testimony, but says that the other evidence is sufficient to support his conclusions. Ironically, some of the evidence considered most damning by Mr Kaplan came from out-takes from “Crude”, a documentary about the Lago Agria case made at Mr Donziger’s behest.

The ruling does not undo the decision of the Ecuadorean court. Yet Chevron hopes it will at least persuade judges in other countries, including Argentina, Brazil and Canada, that they should not use the Ecuadorean court decision to enforce claims against the oil firm’s assets there.

Mr Kaplan reached no conclusion on whether Chevron had a case to answer regarding the environmental damage. Instead, he noted, the behaviour of Mr Donziger and his clients meant that the truth of that matter will now probably never be known. As Mr Kaplan hints, this case seems made for Hollywood, with one big difference: this time, the victim is not the plucky lawyer but the big oil company.