Networks Ignore Big Win for Chevron in Court

U.S. court calls Ecuador ruling ‘fraud,’ obtained ‘by corrupt means.’

In a huge victory for the second-largest U.S. oil company, a U.S. district judge ruled March 4, that a $9.5 billion award against Chevron by an Ecuadorean court was “obtained by corrupt means.” The massive figure had been lowered by Ecuador’s highest court in 2013 after an earlier decision against Chevron of $19 billion.

The broadcast networks took no notice of the decision and failed to mention it on their evening news programming March 4. They found time to mention that Niagara Falls had once again frozen, report a trash problem on Mount Everest, say that rain didn’t stop the Mardi Gras party in New Orleans, and to show how people can make money with their home recipes.

CBS’s omission on “Evening News with Scott Pelley” was the most egregious, since that network was responsible for a lengthy anti-Chevron hit job on the legal battle. Pelley reported from Ecuador in a 2009 “60 Minutes” heavily weighted against Chevron. That 2009 story made attorney Steven Donziger look like a hero helping Ecuadorean tribal people go up against the big, bad oil company.

Donziger is the attorney the U.S. district court just ruled against in favor of Chevron. According to Bloomberg, Judge Lewis Kaplan who oversaw the civil racketeering case said Chevron had evidence the Ecuadorean decision was the result of bribing a judge and ghostwriting documents. Kaplan said the ruling against Chevron was obtained “by corrupt means” and that “The defendants here may not be allowed to benefit from that in any way.”

According to the Wall Street Journal, Donziger sued Texaco in 1993 (Chevron acquired Texaco in 2001) claiming the company had failed to clean up oil pits it had run with PetroEcuador in Lago Agrio.

The now infamous “60 Minutes” story on the dispute included six anti-Chevron voices versus just one spokeswoman for the company. It also ignored the incredible corruption of the Ecuadorean courts. Pelley’s report also used deceptive video footage – showing not the TexPet sites in question, but the government-run oil pits PetroEcuador is responsible for. “60 Minutes” even won an Edward R. Murrow award for its assault on the company.

That  “60 Minutes” report was so biased, Columbia Journalism Review’s “The Audit” took it task for not checking facts and called it “an exercise in innuendo.” CJR also called CBS out for including Manuel Salinas’s complaint that his well had become polluted, since Chevron and Donziger’s team had tested the water and found e.coli (fecal matter) contamination, NOT petroleum.

“This isn’t a matter of belief. It’s a checkable fact. Either the well was or wasn’t part of Texaco’s responsibility under the 1994 deal and was or wasn’t polluted by oil. In this case, available evidence says the answer to the first question is no and the answer to the second is maybe not,” “The Audit” said.

The collapse of the case against Chevron happened over several years. Chevron found videos showing evidence of bribery and corruption of involved parties in Ecuador. Judge Juan Nunez stepped down in September 2009 after videotapes showed him saying he was already going to rule against Chevron. Video outtakes of a left-wing documentary, also revealed unflattering remarks made by Donziger himself and indicated his team wrote materials for a supposedly independent expert. The National Association of Manufacturers said those clips suggested a “sordid orchestration of the claims against Chevron, with Steven Donziger being the cynical conductor.”

So Chevron filed a civil racketeering suit against Donziger, accusing him of conspiracy. Chevron argued in court that Donziger, “repeated acts of fraud, bribery, money laundering” and even ghost wrote a court ruling for an Ecuadorean judge. And on March 4, 2014, Chevron won that suit. Now U.S. courts cannot be used to collect billions from Chevron.

The Wall Street Journal’s review and comment section noted that the judge called the case “extraordinary” and called Donziger and his team’s actions “offensive to the laws of any nation that aspires to the rule of law, including Ecuador.” The WSJ weighed in with its own opinion saying, “We’re glad to see his dishonesty face American justice.”

Chevron responded to the court decision in a press release. In it, Hewitt Pate, Chevron vice president and general counsel said, "Chevron's reputation was taken hostage and held for a multibillion-dollar ransom. Rather than give in and pay these criminals off, Chevron exposed the truth. Chevron is pleased with today's judgment. We are confident that any court that respects the rule of law will likewise find the Ecuadorian judgment to be illegitimate and unenforceable."

— Julia A. Seymour is Assistant Managing Editor for MRC Business at the Media Research Center. Follow Julia A. Seymour on Twitter.