Thwarting a $9 billion dollar shakedown
When the corrupted judiciary of a sovereign state threatened Chevron’s business, the U.S. oil and gas major turned to King & Spalding.
judgment at stake
A case that spans decades
1964
Ecuador’s state oil company, PetroEcuador, begins operations in Lago Agrio oil field. Texaco Petroleum (TexPet, which later became a subsidiary of Chevron in 2001) joins as a minority partner.
1993
Individual plaintiffs (indigenous Ecuadorians) file an environmental class action in New York federal court.
1995
Leaving the Ecuador consortium, TexPet agrees to clean waste pits in proportion to its 37.5% interest, spending three years and $40M to meet international standards. TexPet is released from liability.
1998
The Government of Ecuador grants TexPet a “final release” of all claims for environmental impact arising from the Lago Agrio concession area.
2003
Local and American lawyers file a new suit against Chevron in a small regional court in Ecuador, claiming generalized environmental harm. Concerns regarding fraud and due process quickly emerge.
2009
King & Spalding files a treaty arbitration against Ecuador on behalf of Chevron and TexPet under U.S.-Ecuador BIT, alleging that Lago Agrio violated the 95-98 settlement and other protected rights.
2010–2012
The BIT tribunal orders Ecuador to suspend enforcement of the Lago Agrio judgment worldwide and later holds Ecuador in breach of the treaty and international law for failing to do so.
2015
The BIT tribunal hears evidence of fraud and due process violations in the Lago Agrio litigation in a 3-week oral hearing with over a dozen witnesses, including “insider” Judge Alberto Guerra.
2016
The District Court of The Hague rejects Ecuador’s attempt to set aside the arbitral awards at their legal seat, and upholds all of the BIT tribunal’s awards to date.
The Lawyer
The plaintiffs’ controversial attorney Steven Donziger used flamboyant, theatrical tactics to influence the media and public opinion.
The Judge
As an “insider” witness to the fraud, former Ecuadorian judge Alberto Guerra acknowledged his participation in an utterly corrupt judicial system, and confirmed that the Lago Agrio judgment was bought and paid for by the plaintiffs’ lawyers.
Washington, D.C.
K&S defeated Ecuador’s request to stay the BIT arbitration before a D.C. federal district court, and headed up enforcement efforts against Ecuadorian assets related to a prior $100 million award.
Quito, Ecuador
The firm helped local counsel prepare for the litigation and appeals before Ecuador’s courts, and worked closely with Ecuadorian legal experts to develop Chevron’s claims in the arbitration.
The Hague, Netherlands
King & Spalding worked hand-in-hand with Dutch counsel for Chevron to defend the BIT tribunal’s awards before the Dutch courts at the seat of the arbitration.
Specialists without borders
There are few firms that have the experience and resources to tackle the challenges faced by today’s global companies, whether it’s an existential threat relating to expropriation of assets, or a trade dispute involving companies from different countries.
Generating high-level thinking
K&S is recognized as a pioneer that has broken new ground in developing legal concepts that have benefited their clients.
energy awards
Legal Services Provider of the Year
September 2016
Energy Client Champion
December 2016
Practice Groups of the Year in Four Categories
December 2015
Vera de Gyarfas named as 2016 Women in Energy Honoree
October 2016
Experts in energy
K&S has a history of successfully representing oil and gas companies. That institutional knowledge helps us anticipate issues that will come up in disputes for this industry.
Managing public perceptions
K&S was able to help Chevron defend its global reputation, presenting the facts of the case accurately to the press and announcing favorable rulings as they occurred, to counter the plaintiffs’ lawyers’ attempts to hype the drama.
The sheer magnitude of the judgement as well as Donziger’s PR strategy have made this story a headline feature in the press since its inception.
Throughout the case, Donziger also played dual roles of lawyer and PR strategist, notably stating “this is marketing… you’ve gotta put on a good show.” Donziger involved celebrities and his lawyers bought and paid for a documentary called Crude, premiering at Sundance in 2009.
Proceedings through a U.S. court meant that Chevron attained unreleased outtakes from Crude. U.S. Magistrate Judge Lorenzo F. Garcia stated that the footage shows Donziger and his associates engaging in “unflattering frankness, inappropriate, unethical and perhaps illegal conduct.”
Meet the lawyers on this case:
Edward G. Kehoe
Partner
R. Doak Bishop
Partner
Wade M. Coriell
Partner
Elizabeth Silbert
Partner
David H. Weiss
Partner
Caline Mouawad
Partner
Brian A. White
Partner
Isabel Fernandez de la Cuesta
Partner
Tracie J. Renfroe
Partner
Carol M. Wood
Partner