Indigenous rainforest communities from Ecuador who recently won an $18 billion judgment against Chevron for environmental damage have filed suit  before a renowned international human rights court seeking an order that would prevent the oil giant from using a secret arbitration to violate their legal rights.

The Ecuadorians filed a petition (attached) before the Inter-American Commission on Human Rights strongly criticizing Chevron’s “egregious misuse” of the U.S.-Ecuador Bilateral Investment Treaty (“BIT”) to violate human rights protections. They are seeking an order requiring Ecuador’s government to protect their right to life, physical integrity, health, a fair trial, and equal treatment under the law as guaranteed by the American Declaration of the Rights of Man and other international human rights treaties.

The petition was filed against Ecuador’s government because Chevron is seeking an order from the private investor arbitration panel mandating that the country’s President freeze the court proceedings until the BIT panel can rule, a process which normally takes three years.  Such an order would violate Ecuadorian and international law as well as the human rights protections that the Commission is sworn to uphold, said Pablo Fajardo, the lead lawyer for the Ecuadorian plaintiffs in the underlying environmental case.

The Commission, located in Washington, D.C., hears claims for emergency relief from individual human rights victims and derives its authority from the multilateral international treaty that created the Organization of American States, of which Ecuador and the United States are members. Any order from the Commission is binding on the government against which it is issued.

“The threats are serious and urgent,” the plaintiffs wrote in their petition, referring to their own plight living near extensive levels of toxic oil contamination in the Amazon rainforest for almost 50 years.  An Ecuadorian court in 2011 found Chevron liable for dumping billions of gallons of toxic waste into the Amazon when it operated under the Texaco brand from 1964 to 1992, causing dramatically increased rates of cancer and decimating indigenous groups.

“The idea that an arbitral panel would even contemplate ordering a sovereign state to violate its human rights obligations is repugnant not only to the substance of international human rights law but to the very core of the international legal order,” the petition added.

The petition also argues that the relief sought by Chevron extends well beyond the scope of the BIT in that it does not authorize private investor arbitration panels to act as a “transnational” appellate court that can override decisions in a public court system of a sovereign nation.  The BIT is normally limited to allowing investors to seek monetary damages directly from a government if it feels it has been treated unfairly, a claim that Chevron makes but that the indigenous communities reject.

The Ecuadorians believe the investor arbitral panel convened by Chevron violates international law in that it bars the rainforest communities from appearing before it, does not publish its decisions, and does not inform the public about when and where it meets.  Further, its three members — all practicing lawyers — suffer from a conflict of interest in that they each stand to reap millions of dollars in fees paid in part by Chevron simply by granting jurisdiction over the case when there is little if any basis to do so.

“What Chevron is trying to with this secret arbitration is utterly offensive to anybody who believes in the rule of law,” said Fajardo, whose clients initially filed the environmental lawsuit against Chevron in 1993 in U.S. federal court in New York before it was shifted to Ecuador at Chevron’s request.

“Chevron is trying to convince the private arbitral panel to override the decisions of a public court in a sovereign country where Chevron chose to litigate, even as Chevron continues to pursue appeals in that country making the same arguments it makes before the secret panel,” he added.  “It’s just an outrageous abuse of judicial process.”

“Any decision by the panel granting Chevron’s requests would violate international law and certainly would not bind the indigenous communities who are not a party to the proceedings,” he added.  “We also believe it will backfire against Chevron if the company carries through on its threats to try to block enforcement of the legitimate Ecuador judgment in courts around the world.”

Ecuador’s government has argued that the oil giant has no right to even file the claim under the BIT given that the treaty did not take effect until 1997, or five years after Chevron left the country.

Chevron’s latest maneuver prompted renowned Latin American jurist Jose Daniel Amado to send a letter to U.N. Secretary General Ban Ki-moon asking for a review of what he called an “improper and illegal expansion of arbitral powers” by the panel. The Amado letter gained immediate support from jurists around the world, who sent a separate letter (attached) backing Amado’s arguments to the U.N. official in charge of international arbitration, Renaud Souriel.

Souriel is hosting a meeting this week in New York to evaluate the issue of “transparency in investment-State arbitration.”

Chevron is seeking any forum it can to delay the Ecuador proceedings given that the company could soon face judgment enforcement actions around the world, said Fajardo. Chevron stripped its assets from Ecuador and a company spokesman said the oil giant would fight the rainforest communities “until hell freezes over, and then skate it out on the ice.”

“Chevron lost the trial,” Fajardo said.  “It lost the first-level appeal in Ecuador.  It lost in the United States.  It has very few options left other than a secret arbitration that will carry no weight in any country that observes the rule of law.

“Nevertheless, by filing this petition, we are showing that we will use every legal means available to expose Chevron’s disrespect for the rule of law and to protect the rights of our clients.”

Chevron tried a similar maneuver before, and it backfired.

Image Courtesy of   http://www.flickr.com/photos/rainforestactionnetwork/

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A distinguished international law jurist from Latin America has issued a letter to United Nations Secretary General Ban Ki-moon, asking for a review of Chevron’s “egregious misuse” of an investor treaty to evade its $18 billion liability in Ecuador for creating one of the world’s worst oil-related disasters in the Amazon rainforest, according to a letter released to thousands of arbitration specialists around the globe.

Jose Daniel Amado, a leading law scholar in Peru and a specialist in international arbitration, told the Secretary General that Chevron’s latest attempt to deny the legal claims of the rainforest communities to be decided by an arbitration panel that meets in secret “stands in direct violation of international law” and would “quash” the fundamental human rights of the 30,000 citizens who initially brought suit against Chevron in the United States in 1993.

Chevron shifted that lawsuit to Ecuador in 2002 after praising the country’s judicial system and promising to abide by any judgment there, subject only to narrow enforcement defenses that did not include international arbitration. ”Chevron has constructed what appears to be a calculated plan to manipulate a commercial investment dispute system to evade the outcome of a private litigation,” wrote Amado, who has served as a consultant to the Ecuadorian plaintiffs.

Amado asked the Secretary General to conduct a review of the matter “to ensure that the BIT arbitration system is not used by Chevron to undo international law protections guaranteeing access to justice.”

In January, after a nine-year legal proceeding, a three-judge panel of the Ecuador appellate court confirmed an $18 billion award against Chevron for the deliberate dumping of billions of gallons of toxic waste into Amazon waterways that local inhabitants relied on for drinking water.  The Ecuador trial court found evidence that Chevron’s contamination decimated indigenous groups and caused an outbreak of cancer and other oil-related diseases.

The trial in Ecuador produced 220,000 pages of evidence and more than 64,000 chemical sampling results from independent laboratories which proved that dozens of Chevron oil production facilities suffer from extensive levels of life-threatening heavy metals and toxins, according to the findings of the Ecuador court.

On January 4, the day after the Ecuador appellate court decision, Chevron petitioned a private arbitration panel convened under the U.S.-Ecuador Bilateral Investment Treaty (“BIT”) to order Ecuador’s executive branch to interfere in its independent judiciary and block the ability of the Ecuadorian citizens to enforce their judgment in countries around the world.  Chevron had stripped its assets from Ecuador to avoid paying the judgment.

Lawyers for the Ecuadorians say the arbitration panel does not have such authority, and that in any event Ecuador’s government is obligated to ignore its orders given its own binding legal obligations under the Ecuador Constitution and various international treaties protecting the human rights of its citizens.

The arbitration panel prohibits the Ecuadorians from appearing before it and takes no steps to inform them (or the public) of the status of its proceedings or when or where it is meeting.  Nor does it release its decisions in a system that clearly lacks due process of law, said Aaron Page, who represents the Ecuadorians and who has represented governments in the arbitral proceedings.

Some commentators have like ecuadorians end the secret arbitration panel to a “kangaroo court” rife with conflicts of interest and imbued with a pro-business culture.

The arbitrators are private sector lawyers who generally rule in favor of investors and against sovereign governments — a fact which in recent years has led several countries to withdraw or threaten to withdraw in recent years from the arbitral system, said Page. ”Chevron’s radical request for relief in this case potentially undermines the credibility of the entire investor arbitral regime,” Page said.

In the letter to Ban Ki-moon, Amado noted that a recent “interim” order by the arbitration panel asking Ecuador’s government to freeze the environmental case “makes a travesty of the bilateral commercial treaty system” and represents an “illegal expansion of arbitral powers with wide-ranging implications for well-settled principles of international law, including fundamental human rights and state sovereignty.”

“Such a result is simply untenable under international law — BIT arbitral panels cannot be called on by investors to set aside countries’ constitutional systems and sovereignty, which are essential components of modern democracies,” he added.

Concern over Chevron’s latest stratagem, Amado pointed out, is shared by a U.S. federal appellate court which ruled last year that the longstanding legal claims of the Ecuadorians “cannot be settled” through the BIT arbitration given that they are not a party to those proceedings.

“The international legal community was shocked by this [interim] Order, which Chevron interpreted to force the Ecuadorian executive branch affirmatively to interfere in a judicial process and limit Ecuador’s sovereignty vis-a-vis a case that has been in the courts for 18 years,” he said.

The Amado letter was emailed to 7,000 arbitrators around the world by the Peruvian Arbitration Institute, which said it considered the letter to “of high interest” to the international arbitration community.

Amado is a graduate of Harvard Law School and the founding partner of Miranda & Amado, one of Peru’s leading law firms.  He has published numerous articles on international law topics, has lectured in various countries, and has represented both private investors and governments before BIT arbitration panels.

Amado is also a member of the American Chamber of Commerce in Peru and is President of the Energy Legal Committee of Peru’s National Mining, Oil and Energy Society.

The three arbitrators hearing the Chevron claims — all private lawyers who represent investors before other arbitration panels in the same treaty system — stand to personally reap millions of dollars in fees if they grant jurisdiction over the case, which in itself is a hotly contested issue given that Chevron left Ecuador five years before the U.S.-Ecuador BIT took effect in 1997, Page said.

R. Doak Bishop, an American from the firm King & Spalding who is Chevron’s lead lawyer in the Ecuador matter, has served as an arbitrator in numerous cases convened under the BIT process while he simultaneously represents private clients in the same system.  Ecuador’s American lawyers are only putting up a nominal defense, essentially leaving the Ecuador plaintiffs without representation before the panel, said Karen Hinton, the U.S. spokesperson for the plaintiffs.

In any event, it is clear that any “award” from the panel will lack legitimacy in countries that observe the rule of law and will not be an obstacle to enforcement of the Ecuador judgment, said Amado.

“This is a far-fetched strategy by Chevron that has little chance of working,” said Amado.  “But it is our duty as international lawyers to prevent it from causing collateral damage to the international legal order that protects the human rights of all peoples worldwide.”

Image Courtesy of   http://www.flickr.com/photos/rainforestactionnetwork/

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After being found liable in Ecuador for creating one of the world’s worst oil disasters, Chevron filed a notice of appeal to Ecuador’s highest court where it seeks special treatment not afforded any other litigant under the nation’s laws — the waiver of a bond required to suspend enforcement of a judgment during the pendency of any appeal.

It would be illegal under Ecuadorian law for the appellate court to grant Chevron’s unusual and unprecedented request to waive the bond requirement, said Pablo Fajardo, the lead attorney for the indigenous and farmer communities who brought suit against the oil giant for the dumping of billions of gallons of toxic waste into the waterways used by several indigenous groups and farmer communities.

“Chevron has every right under the law to seek an extraordinary appeal to the highest court as long as it can cite a proper legal basis,” said Fajardo.  “But Chevron is yet again seeking a special exemption under Ecuadorian law when it claims the bond requirement should not apply to it, while it applies to every other litigant in the country.”

“Chevron behaves in Ecuador as if it is above the law while thousands of people continue to suffer the devastating effects of the company’s toxic contamination,” said Fajardo.  ”This abuse of the judicial process must end.”

For execution of a court judgment in Ecuador to be suspended pending appeal to the highest court — called the National Court of Justice — the losing party must post a bond that is usually calculated at roughly 8% of the amount of damages awarded (roughly $1.5 billion in this case). Chevron is seeking to have enforcement suspended even without posting a bond even though the indigenous and farmer communities continue to suffer grave health effects engendered by the company’s delaying tactics, said Fajardo.

Karen Hinton, the U.S. spokesperson for the Ecuadorians, said in a statement that “for almost two decades, Chevron has stood in the way of a comprehensive cleanup of billions of gallons of crude oil and toxic waste water it deliberately dumped into the pristine rainforest of Ecuador.”

“Thousands of people have died or suffered from illnesses as Chevron and its army of lawyers have waged a campaign to distract attention from the overwhelming scientific evidence against the company,” said Hinton. “Chevron has always believed that Ecuador’s many laws prohibiting environmental contamination should not apply to its misconduct.”

The bond requirement, typical in countries around the world including the U.S., is intended to protect the winning side from unnecessary delays during appellate review.  Ecuador’s first-level appellate court already affirmed the trial court judgment that the company is required to pay $18 billion for a clean-up, a relatively modest amount compared to BP’s estimated $60 billion liability for the smaller Deepwater Horizon spill in the Gulf of Mexico.

Fajardo also said that an arbitral order cited by Chevron as justification for its request for a bond waiver is not binding on the rainforest communities as they are not a party to that proceeding, which is held in secret pursuant to a U.S.-Ecuador investment treaty.

In any event, the arbitral panel never ordered — and under the law cannot order — that Ecuador’s courts take steps that would “clearly violate” Ecuador’s Constitution and international treaties binding the government to protect the fundamental human rights of its citizens, including the right to life and the right to seek legal redress in national courts, said Fajardo.  Further, the arbitral panel has never even held an evidentiary hearing on Chevron’s claims that a remediation contract with Ecuador’s government released it from liability.

“We believe Chevron clearly is misinterpreting the scope of authority of the arbitration,” he added. ”We want to reiterate that Chevron has every right to appeal to Ecuador’s National Court of Justice, but it has no right to special treatment during the pendency of the appeal,” Fajardo added.

The trial court decision, issued in February 2011, found that Chevron systematically dumped billions of gallons of toxic waste into the Amazon, poisoning waterways that local inhabitants use for drinking water and causing increased cancer rates. Damages were set at $18 billion.  In 2002, the case was shifted from U.S. federal court to Ecuador at Chevron’s request.

The trial court in Ecuador also repeatedly sanctioned Chevron’s legal team for filing frivolous motions intended to delay the proceedings, and for threatening a judge with jail if he did not rule in favor of the company.  These actions led to a punitive damages award that accounts for roughly half of the total judgment.

Chevron has roughly two more weeks under Ecuadorian law to determine if it will publicly apologize for its misconduct, which would allow it to eliminate the punitive damages component of the award.

As support for the contention that Chevron believes it does have to adhere to the law in Ecuador, Hinton cited a comment in a 60 Minutes interview where Chevron attorney Silvia Garrigo – pressed as to why the company said it would never pay any adverse judgment in Ecuador – said: “We don’t believe we should be in any court, much less the courts of Ecuador.”

The 188-page trial court judgment is undergirded by a wide body of scientific and testimonial evidence submitted during eight years of proceedings that prove Chevron designed a system of oil extraction that deliberately discharged toxic oil waste into the environment to keep production costs to a minimum. Chevron also has been heavily criticized for trying to defraud the Ecuador court and sabotage the proceedings.

In briefs submitted to U.S. and Ecuadorian courts, the rainforest communities submitted evidence that Chevron technicians staked out “clean” spots at contaminated well sites to test prior to court-supervised judicial inspections; sent dirty soil samples to a secret lab to prevent their disclosure to the court; and doctored a “judicial playbook” document so two academic experts in the U.S. would endorse the company’s misleading sampling protocol, among other charges.

A separate ruling by a New York federal appellate court marks Chevron’s third consecutive legal setback in its effort to block enforcement of the Ecuador judgment.

In September, a federal appellate panel blocked Chevron’s attempt to seek an unprecedented worldwide injunction blocking enforcement. In January, a federal district court judge denied Chevron’s illegal attempt to freeze the assets of the plaintiffs. And on January 3, Ecuador’s first-level appellate court confirmed the validity of the trial court judgment.

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In a stark departure from its normal litigation practices, Chevron has refused to request that the Ecuador appellate court that recently affirmed the $18 billion judgment against the oil major reconsider or clarify its decision.

Chevron let a deadline pass that allowed either party to contest or clarify the decision, which was issued on January 3. The appellate court on Friday January 13 reaffirmed its original decision in response to ten separate clarification requests submitted by lawyers for the rainforest communities.

Normally in Ecuador, the losing party in an appeal seeks clarification of an appellate court decision unless it decides it is withdrawing from the litigation or simply accepting the result. Asking for clarification in Ecuador is roughly similar to filing a motion for reconsideration in the United States.

It is unclear why Chevron did not contest or seek clarification of the appellate court decision, but its failure to do so could be seen as a disadvantage as the case moves forward both in Ecuador and potentially in other jurisdictions where the rainforest communities might seek enforcement, said Pablo Fajardo, the lawyer for the Ecuadorian communities who brought the lawsuit.

Chevron, which requested that the trial take place in Ecuador, stripped its assets from the country and has announced it will not pay the judgment. ”By not contesting the appellate court decision, Chevron is essentially conceding that it has no problem with the court’s reasoning or logic,” said Fajardo.

“Chevron also is effectively abandoning its argument that it exhausted all legal remedies in the courts of Ecuador before it tries to block any possible enforcement actions,” he added.

Chevron normally “litigates to the hilt” in Ecuador while simultaneously attacking Ecuador’s courts as unfair, a charge vigorously rejected by the plaintiffs based on expert testimony, said Karen Hinton, the U.S. spokesperson for the Ecuadorians.

“Failing to take advantage of every right afforded it by procedural law is a real departure from Chevron’s normal litigation practice in courts around the world,” said Hinton. “It might reflect a new strategy, or it might reflect simple confusion as the company’s legal options narrow.”

The trial court decision, issued in February 2011, found that Chevron deliberately dumped billions of gallons of toxic waste into the Amazon, poisoning waterways that local inhabitants use for drinking water and causing a spike in cancer rates. See here and here. Damages were set at roughly $18 billion.

Chevron operated in Ecuador from 1964 to 1992 under the Texaco brand.

The trial court in Ecuador also repeatedly sanctioned Chevron’s legal team for filing frivolous motions and threatening a judge if he did not rule in favor of the company, leading to a punitive award that constitutes roughly half of the total damages.

In response to the request by the plaintiffs for clarification, the three-judge appellate panel in Ecuador issued a second opinion on January 13 that rejected several Chevron arguments but also made clear that the company could stop enforcement of the judgment if it posts a bond during the pendency of any appeal to the nation’s highest court.

That court, called the National Court of Justice, is similar to the Supreme Court in the U.S. and is located in the capital of Quito.

Chevron must decide by Friday, Jan 20, if it will file a notice of appeal to the higher court, which has the discretion to accept or reject it much like the Supreme Court in the U.S., said Hinton.

The request for the appeal must be made to the intermediate appellate court that affirmed the trial court decision, which then has the discretion to set a bond before sending the case to the National Court of Justice for consideration. Chevron must request the bond as a way to suspend enforcement of the judgment pending further appeal, said Hinton.

A bond is customarily set by the intermediate appellate court at approximately 8% of the amount of the judgment, or in this case approximately $1.6 billion. Chevron reported annual revenues in 2011 of close to $240 billion, with profits expected to be roughly $30 billion based on its latest quarterly earnings report.

The Ecuador appellate court also made the following points in its second ruling on Jan. 13:

**Chevron has 15 business days (tolled from Monday of this week) to eliminate a punitive damages component of the award by issuing a public apology, considered a key component of accountability under international human rights law. Such an apology could effectively cut the $18 billion award in half.

**The appellate court provided detailed guidance as to the nature and scope of the apology that Chevron would need to make. Among other things, the court said Chevron must admit that it used unacceptable waste disposal practices in Ecuador that caused harm to the rainforest and its inhabitants. It also must publish its apology in newspapers in Ecuador and the U.S.

**The appellate court reiterated that its judgment represents the “final and definitive step” under the Ecuadorian legal system to settle the dispute of the parties. An appeal to National Court of Justice is considered “extraordinary” under Ecuador law and will not block a potential enforcement action unless a bond is posted.

The bond in Ecuador is designed to compensate the winning party for any further delays in collecting its judgment — similar to a running interest rate, which is often used by courts in other countries during the pendency of any appeal. If Chevron were to prevail at the National Court of Justice, the bond monies would be returned to the company.

**The appellate panel also said it “rejects… definitively and as unfounded, [Chevron's] affirmation … that the judgment has been based on information foreign to the record, or with secret assistance.”

**The appellate also found that the trial court ruling was “firmly rooted” in the voluminous 220,000-page evidentiary record, which included thousands of chemical sampling results from both Chevron and the plaintiffs that proved extensive contamination at hundreds of former Chevron oil production sites.

In its original judgment affirming the trial court decision, members of the panel were clearly outraged at Chevron’s abuse of the judicial process in Ecuador. The court found that many of Chevron’s legal filings were “abusive” and “clearly designed to obstruct the administration of justice.”

Inhabitants from dozens of rainforest communities filed the class action case in 1993 in U.S. federal court. Chevron had the trial shifted to Ecuador after heaping praise on that country’s judicial system.

Once the evidence in the subsequent trial started to point to Chevron’s guilt, the company shifted gears and tried repeatedly to attack the courts it had previously praised. In the meantime, several courts have sanctioned Chevron’s lead outside firm in the U.S., Gibson Dunn & Crutcher, for engaging in ethical violations on behalf of Chevron’s campaign to evade the Ecuador judgment.

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Only thinking about the strength a person needs to have in order to leave their country to seek a better future is an enormous effort, and life decision. But many people around the world decide to take this decision in order to provide a better future for their family members, and the future generations. Unfortunately reality for many people in this world is so harsh in their own homeland, that having the opportunity to leave and search for new opportunities is the impulse they have to leave all they area accustomed and used behind.

Spain has been transformed from being a country of emitting emigrants, to a country, which has opened its door as a receptor of migratory flow. Moroccans, Rumanians and Ecuadorians constitute the main presence of immigrants in Spain.  Madrid has been the primordial zone for immigrants to locate themselves since normally they opt for zones where there is a great economic movement, so the opportunities of finding job offers enlarge.

Nevertheless, the statistics exposed by the Secretary of Immigration and Emigration that were updated until the 31^st of December of 2010 revealed that the number of Ecuadorian people inscribed in the Foreign Spanish regimen, reduced to 10.78% with comparison of the year 2009.

Compared to other collective members, the Ecuadorians were the ones with the more reduction. Other members such as the Argentinean people that are inscribed in Spain also reduced 9.83% from 2009. Does these reductions are insinuating that the crisis in Spain is making people leave the country? Nevertheless, by taking an inside view from the number of foreign people have increase 2.8% since 2009.

People coming from Rumania still show the highest percentage of the foreign people in Spain. They increase also their presence lifting it 11,85% with regards of 2009.

Within the total number of foreign with residence permit, the cipher exposes that 2.524.976 million are inscribed in the Foreign Spanish Regime. On the other hand there is still a huge presence of 2.401.632 million that are in the Communitarian Regime.

Also, by analyzing the overall ciphers in the General Regime, this leads to the conclusion that the presence of foreign people that do not belong to the European Union reduced to 37.056 with respect of the previous 2009 records. Which represents a decrease of 1.45%.

Still the percentage of immigrants in Spain is high, and most of them come from Latin America. Almost two million of people proceed from Latin America, specially focusing on the countries located at the North, whereas more than 2 million on the other hand come from the European Union.

Now that Spain has been one of the most affected countries in the European Union, the decrease in the foreign sector, does not bring any surprises since obviously they were one of the most affected sectors within unemployment and salary reductions.

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