Siding with Chevron, Judge Oks Bench Trial in Ecuador Case
Chevron Corporation is getting its wish for a bench trial in its fraud and racketeering case against Steven Donziger, the U.S. lawyer accused of rigging a $19 billion environmental judgment in Ecuador. U.S. District Judge Lewis Kaplan in Manhattan made it official on Monday, rejecting Donziger's arguments that he and his co-defendants have a right to contest Chevron's claims in front of a jury.
Chevron dropped its demand for money damages from Donziger late last month, asserting that it seeks only equitable relief and paving the way for Kaplan to decide the case himself when trial finally kicks off on Oct. 15. Chevron accuses Donziger and his allies of procuring the Ecuadorian mega-verdict through fraud and bribery, and it's aiming for a decision that will stymie the Ecuadorians' efforts to enforce their judgment worldwide.
In a motion filed early this month, Donziger and his co-defendants, Ecuadorian lawyers Hugo Gerardo Camacho Naranjo and Javier Piaguaje Payaguaje, asked Kaplan to let a jury hear the case. "Chevron is simply masquerading damages as equity," they argued, adding that holding a bench trial would deprive them of their Seventh Amendment rights.
Donziger pointed out that Chevron and its lawyers at Gibson, Dunn & Crutcher have repeatedly called him a "criminal" in open court and on earnings calls. "It would amount to a travesty of justice to deny me and my clients a jury trial in what is essentially a private prosecution funded by corporate largesse," Donziger wrote.
The argument didn't get very far with Judge Kaplan, whose hold on the case recently survived a challenge from the Ecuadorians at the U.S. Court of Appeals for the Second Circuit. "Cases seeking only injunctions, imposition of constructive trusts, and disgorgement — including RICO cases based on alleged mail and wire fraud seeking only such relief — all are purely equitable and carry no right to trial by jury," the judge wrote.
Chevron spokesman Morgan Crinklaw passed along the following statement by email: "Chevron is looking forward to holding Steven Donziger and his co-conspirators accountable for orchestrating and executing a fraudulent extortion scheme against the company."
Christopher Gowen, a spokesman for Donziger and the Ecuadorians, said in a statement that there's "simply no way" Kaplan can fairly hear the case on his own. "Given the documented evidence of his own bias, Judge Kaplan's last-minute decision is a clear abuse of power and again shows Chevron does not believe enough in its own case to present it to a jury," Gowen said. "This decision also guarantees that Judge Kaplan's expected finding of 'liability' against Mr. Donziger and the Ecuadorians will have no legitimacy in courts around the world who ultimately will determine whether Chevron pays the Ecuador judgment."