Lawyer 'wanted no part' of case against Chevron in Ecuador

Reuters

By Nate Raymond

NEW YORK, Oct 31 (Reuters) - A New York lawyer testified onThursday that he quit a team that was suing Chevron Corp over environmental pollution in Ecuador in 2010 for "ethical"reasons.

The testimony appeared to bolster Chevron's effort toprevent the lawyer who headed the litigation, Steven Donziger,from pursuing enforcement of a $19 billion award againstChevron.

Jeffrey Shinder, a partner at the law firm ConstantineCannon, said Donziger had approached him starting in late 2009about helping enforce any award the Ecuadorean court issued.

Shinder said he quit after just eight days into his formalretention after learning that a report by an expert appointed bythe Ecuadorean court had actually been written by a consultingfirm working for the plaintiffs.

"I wanted no part of it," Shinder said in federal court inNew York.

The testimony came in the third week of the non-jury trialbefore U.S. District Judge Lewis Kaplan in which Chevron claimsthat Donziger and others engaged in fraud and bribery to obtainthe award.

In 2011, a judge in Ecuador awarded $18 billion to peoplefrom the village of Lago Agrio, who had for years been pursuinglitigation over environmental contamination from 1964 and 1992at an oil field operated by Texaco, which Chevron bought in2001.

The award was later increased to $19 billion to cover fees.But as Chevron no longer has assets in Ecuador, the Ecuadoreanshave been forced to look overseas and have pursued enforcementactions in Canada, Argentina and Brazil.

Chevron, the second-largest U.S. oil company, has refused topay. It filed the New York lawsuit in 2011 claiming the awardwas the product of fraud.

At trial Thursday, Shinder, whom Chevron subpoenaed totestify, said Donziger approached him about joining the case inOctober 2009 as Donziger began preparing to fight to enforce ananticipated judgment.

While no award had been issued, a court-appointed expert hadin April 2008 issued a report recommending the judge holdChevron liable for up to $16.3 billion in damages.

The expert, Richard Stalin Cabrera Vega, revised hisrecommendation in November 2008 to $27 billion.

STRATUS CONSULTING

Chevron has long contended that Cabrera's report wasghostwritten by a consulting firm, Stratus Consulting Inc,working for the plaintiffs. Shinder said Donziger had sought toassure him Chevron's claims were "trumped up" and inaccurate.

"He denied the allegations, but did say to me that, 'Youhave to understand, they do things differently in Ecuador,'"Shinder said.

In March 2010, Shinder's firm agreed to represent theplaintiffs in cases Chevron had filed in the United Statesseeking evidence in aid of the Ecuador litigation.

Soon after, Shinder said he flew out to Colorado atDonziger's expense to meet employees at Stratus, includingco-founder Douglas Beltman.

Near the end of his two-hour conversation with Beltman,Shinder said the "truth came out" as he admitted Stratus hadwritten portions of Cabrera's report.

After discussing the matter with other lawyers at his firm,Shinder said he told Donziger he would be withdrawing, primarilyfor "ethical reasons."

"It bothered me and still bothers me that we'll never knowif there was a case against Chevron," Shinder said.

Stratus Consulting, once a co-defendant in the New Yorkcase, settled with Chevron in April. It has also disavowed anyand all findings and conclusions of reports it issued in theEcuador litigation.

The case is Chevron Corp v. Steven Donziger et al, U.S.District Court for the Southern District of New York, No.11-0691.

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