Volume 1, Issue 2

Articles

Reversal of Fortune: The Lago Agrio Litigation

Patrick Radden Keefe
The jungle outpost of Lago Agrio is in northeastern Ecuador, where the elevation plummets from the serrated ridge of the Andes to the swampy lowlands of the Amazon Basin. Ecuadorans call the region the Oriente. For centuries, the rain forest was inhabited only by indigenous tribes. But, in 1967, American drillers working for Texaco discovered that two miles beneath the jungle floor lay abundant reserves of crude oil. For twenty-three years, a consortium of companies, led by Texaco, drilled wells throughout the Ecuadoran Amazon. Initially, the jungle was so impenetrable that the consortium had to fly in equipment by helicopter. But laborers hacked paths with machetes, and, eventually, Texaco paved roads and built an airport.
  • June 2013
  • 1 Stan. J. Complex Litig. 199
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Ten Lessons from the Chevron Litigation: The Defense Perspective

Theodore J. Boutrous, Jr.
Of the many thorny issues raised by transnational litigation against U.S. companies, the lawsuit that Chevron Corporation is fighting in Ecuador touches on them all: legal ethics, weak and corrupt foreign judiciaries, litigation fraud, judgment enforcement, third-party litigation financing, cross-border discovery, and international arbitration, to name just a few. In fact, one of the attorneys representing the Ecuadorian plaintiffs recently described the case as a “model” for future transnational litigation, a template for forcing U.S. companies to foot the bill for all manner of alleged injuries abroad. If the Chevron litigation is to serve as a roadmap for future transnational lawsuits, however, then plaintiffs’ lawyers seeking to bring claims in foreign jurisdictions, especially those with troubled judiciaries that lack independence and basic due process protections, had better understand exactly where that map will lead them—and make sure they are comfortable going there.
  • June 2013
  • 1 Stan. J. Complex Litig. 219
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Lessons from the Chevron Ecuador Litigation: The Proposed Intervenors' Perspective

Judith Kimerling
This symposium provides a welcome opportunity for scholars and practitioners with a wide range of perspectives to examine issues raised by the increasingly complex litigation related to Texaco’s oil extraction operations in the Amazon Rainforest in Ecuador. I have worked in the affected region since 1989, and my original research was the basis for the environmental allegations in the initial class action lawsuit that launched the ongoing litigation that has come to be known as “the Chevron-Ecuador Litigation.” That lawsuit, Aguinda v. Texaco, Inc., was filed in federal court in New York in 1993, and asserted claims on behalf of Indigenous and settler residents who have been harmed by pollution from Texaco’s Ecuador operations. I was not involved in bringing either that case or the subsequent Aguinda lawsuit in Ecuador, but I have continued to work in the region in various capacities—and to regularly visit oil field facilities and affected communities—and in 2012, I was retained by a group of forty-two Indigenous Huaorani leaders from five communities to help protect their interests in the litigation.
  • June 2013
  • 1 Stan. J. Complex Litig. 241
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Discovery Under 28 U.S.C. § 1782: Distinguishing International Commercial Arbitration and International Investment Arbitration

S.I. Strong
One of the more compelling legal dramas to arise in recent history involves the ongoing dispute between Chevron, Ecuador and various indigenous peoples who lived in or near certain oil fields developed by Texaco Petroleum in the Amazon rainforest in the 1960s and 1970s. Not only has the matter appeared in U.S. courts on various occasions over the last twenty years, it has also generated a US$18 billion judgment in the Ecuadorian national courts. That judgment, which is now final, has been subject to enforcement actions in several countries where Chevron has assets, including Argentina, Brazil and Canada.
  • June 2013
  • 1 Stan. J. Complex Litig. 295
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The Rise of Arbitral Power Over Domestic Courts

Michael D. Goldhaber
On numerous occasions, domestic courts have been called upon to check the power of arbitrators. These occurrences have not gone without notice by commentators, and there is a rich literature discussing courts’ control over arbitrators. But the opposite phenomenon—that is, the willingness of international arbitrators to check the power of domestic courts—has received no such treatment. Indeed, the existence of arbitral power over domestic courts likely comes as a surprise to observers outside the world of investor-state arbitration. It has been seldom considered that arbitrators might control judges. Nonetheless, investment tribunals are far more willing than courts to assert control over a foreign court, and do so with increasing frequency.
  • June 2013
  • 1 Stan. J. Complex Litig. 373
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The Global Chase: Seeking the Recognition and Enforcement of the Lago Agrio Judgment Outside of Ecuador

Manuel A. Gómez
A final judgment marks an important milestone in the lifecycle of a court case, but it is by no means the end of the journey. This is particularly true in the realm of transnational litigation, where judgments rendered by the domestic courts of one state, are likely to be recognized and enforced in one or several other jurisdictions. Different from local judgments, which often rely on a uniform set of rules and a straightforward enforceability regime; the recognition and enforcement of foreign judgments depends on a mixture of international agreements, the domestic law principles, public policy and public order considerations of the nations involved.
  • June 2013
  • 1 Stan. J. Complex Litig. 429
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Some Cautionary Notes on the "Chevronization" of Transnational Litigation

Christopher A. Whytock
In 1993, residents of the Lago Agrio region of the Ecuadorian Amazon sued Texaco, Inc. alleging extensive environmental damage and personal injuries caused by Texaco’s oil extraction operations there. The U.S. District Court for the Southern District of New York dismissed the suit on forum non conveniens grounds in favor of the courts of Ecuador, and the U.S. Court of Appeals for the Second Circuit affirmed in 2002. Meanwhile, Chevron Corp. had acquired Texaco in 2001. After the forum non conveniens dismissal, the Lago Agrio plaintiffs sued Chevron in an Ecuadorian court, which entered a $17.2 billion judgment against Chevron. Since then, the parties have been engaged in an extensive litigation and public relations battle over the enforcement of the judgment, a battle that has reached beyond the United States and Ecuador to countries including Argentina, Brazil and Canada. According to the Second Circuit, this story of conflict “must be among the most extensively told [stories] in the history of the American federal judiciary.”
  • June 2013
  • 1 Stan. J. Complex Litig. 467
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When Bad Guys Are Wearing White Hats

Catherine A. Rogers
Allegations of ethical misconduct by lawyers have all but completely overshadowed the substantive claims in the Chevron case. Although each side has accused the other of flagrant wrongdoing, the charges against plaintiffs’ counsel appear to have captured more headlines and garnered more attention. The primary reason why the focus seems lopsided is that plaintiffs’ counsel were presumed to be the ones wearing white hats in this epic drama.
  • June 2013
  • 1 Stan. J. Complex Litig. 487
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A Plague on Both Their Houses: A Modest Proposal for Ending the Ecuadorean Rainforest Wars

Burt Neuborne
Long ago and far away, Texaco, an American energy corporation, is alleged to have despoiled the natural environment of the Ecuadorean rainforest while searching for and extracting oil. While the parties disagree strongly over the precise scope of the damage caused by Texaco, there is widespread agreement that significant environmental degradation took place, at least in part because Texaco failed to follow established industry procedures designed to limit environmental harm. Texaco apparently made money during the project’s twenty-eight-year run from 1964-92, but the lives of thousands of indigenous peoples whose culture—indeed whose very existence—was deeply intertwined with the environment of the rainforest were radically disrupted, perhaps permanently impaired, as the result of Texaco’s failure to take steps to limit environmental damage.
  • June 2013
  • 1 Stan. J. Complex Litig. 509
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