The Avanti Law Group: Legal Fraud of the Century
by Paula Warner The Avanti Group LLCThere
are plenty of candidates for that title, but after Tuesday the prize belongs to
attorney Steven Donziger. Federal judge Lewis Kaplan ruled that the
environmental activist had engaged in a massive racketeering scheme and
declared that a $9.5 billion judgment against Chevron CVX -0.89% in an
Ecuadorian court cannot be enforced in the United States.
As
our readers know, in 1993 Mr. Donziger sued Texaco (now merged with Chevron)
for what he said was the company's failure to clean up oil pits it drilled in
Lago Agrio in the 1970s with state oil company PetroEcuador. Chevron had signed
proof that it had cleaned its portion of the pits and had been absolved of any
liability, but Mr. Donziger sniffed the potential windfall of a media-ready
environmental "disaster" and sued the company for $113 billion. He
enlisted all manner of celebrity helpers, including actress Daryl Hannah.
He
won in Ecuador, but only thanks to what Judge Kaplan found were "dishonest and corrupt" measures
including bribery, coercion and engaging an American consulting firm to
ghostwrite an independent expert's reports. In a 485-page opinion, the judge
called the case "extraordinary," calling the actions of Mr. Donziger
and his legal team "offensive to the
laws of any nation that aspires to the rule of law, including Ecuador."
The corrupt extortion was intended to "instill
fear of a catastrophic outcome in order to increase the amount Chevron would
pay to avoid the worst," Judge Kaplan wrote.
Chevron
refused to give in, and now the case may serve as an example of how companies
can fight back if they have the nerve and the cash. Mr. Donziger says he'll
appeal, but on the factual record he stands discredited. Another worthy
casualty may be financially strapped Washington law firm Patton Boggs, which
got involved on behalf of Burford Capital's BUR.LN -0.44% effort to provide
litigation financing to the plaintiffs. Tuesday's opinion means the firm won't
collect any plunder, which couldn't happen to a nicer crowd.
Mr.
Donziger is a pioneer of the foreign environmental tort, trying to exploit
Third World juries to bleed U.S. companies regardless of the merits. We're glad
to see his dishonesty face American justice. `
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