WASHINGTON – Chevron Corp. hailed a District Court of The Hague ruling in favor of the U.S. energy supermajor in its legal battle with Ecuador, which had sought to nullify arbitral rulings handed down against the country in connection with a multi-billion-dollar pollution judgment.
“Today’s decision reinforces the integrity of the arbitral proceedings and ensures that Ecuador will be held accountable for violations of its international commitments,” the San Ramon, California-based oil company said in a statement Friday.
“We look forward to the tribunal’s final award on the merits, which should hold Ecuador responsible for the multiple frauds committed against Chevron throughout the Lago Agrio case.”
The District Court of The Hague noted in its decision that the arbitration tribunal convened under the authority of the U.S.-Ecuador Bilateral Investment Treaty and administered by the Permanent Court of Arbitration in the Netherlands handed down an interim ruling against Quito in September 2013.
That decision stated that Ecuador’s government certified the environmental remediation work carried out by Texaco and released the company, which exited Ecuador in 1992, from potential liability for oil pollution claims.
Chevron acquired Texaco in 2001.
It noted that the arbitration court also found in February 2013 that the Ecuadorian government had violated international law by finalizing and failing to prevent enforcement of 2011 and 2012 pollution verdicts against Chevron handed down by courts in the northeastern Ecuadorian city of Lago Agrio (also known as Nueva Loja).
Ecuador’s National Court of Justice upheld that verdict in November 2013, ruling in favor of rainforest communities and ordering Chevron to pay a $9.5 billion penalty for the dumping of billions of gallons of crude residue and toxic waste water in the Oriente region of eastern Ecuador between 1964 and the early 1990s by Texaco.
The District Court of The Hague’s ruling on Wednesday rejected Ecuador’s argument that the arbitration tribunal lacked jurisdiction to hear Chevron’s arbitration claim against the judgment.
That claim was first filed in September 2009 alleging that the case in Ecuador had been mired by fraud and that justice had been denied.
The District Court also said “it must be assumed that at the time the interim measures were taken, the tribunal had serious indications that the judgment rendered at first instance in the Lago Agrio proceedings had come into being fraudulently and under political pressure.”
Chevron, which says the judgment in Ecuador stemmed from “unethical action by the plaintiffs’ lawyers as well as the Ecuadorian government (referring to leftist President Rafael Correa’s administration) and judiciary,” has not denied that the rainforest was polluted but says the national oil company Petroecuador is to blame.
The Ecuadorian plaintiffs have unsuccessfully sought to collect on the verdict through international legal action.