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Chevron continues to win legal victories against a 2011 Ecuador pollution verdict a US judge ruled was fraudulent. Here Ecuador oil workers. (Photo: Secretaria de Hidrocarburos)
Thursday, May 31, 2018
Legal Briefs

Ecuador: Chevron Secures Legal Victories

US oil company secures legal victories in Canada, Brazil and Gibraltar.


US-based oil company Chevron has recently secured legal victories in Brazil, Canada and Gibraltar related to its Ecuadorian verdict, which the firm deems fraudulent.

In 2011 a court on Ecuador ruled that Chevron was guilty of pollution and fined it $9.5 billion. Chevron has said the verdict was based on fraud and in 2014 US federal judge Lewis Kaplan agreed. (see Chevron Wins Ecuador Fraud Case).

On May 23, the Ontario Court of Appeal upheld a lower Canadian court’s determination that an Ecuadorian judgment against Chevron Corporation cannot be enforced against Chevron Canada Limited, an indirect subsidiary, Chevron announced.

“The Court of Appeal affirmed the judgment dismissing all claims against Chevron Canada Limited holding that it is a separate entity from Chevron Corporation and its assets are protected from seizure by those seeking to enforce the corrupt Ecuadorian judgment, the statement from Chevron said. “The court rejected the Ecuadorian plaintiffs’ arguments as contrary to fundamental principles of Canadian corporate law.

The Court of Appeal stated: “What is really driving the appellants' appearance in our courts is their inability to enforce their judgment in the United States,” where it is has already been found to be the product of “a massive fraud” that involved both corruption and coercion of judges.  The Court of Appeal continued: “What we are really being invited to do is to assist the appellants in doing an end-run around the United States court order by breaking with well-established jurisprudence and creating an exception to the principle of corporate separateness.”

R. Hewitt Pate, vice president and general counsel, Chevron Corporation, praised the ruling.
"We are pleased that the Ontario Court of Appeal has affirmed the trial court’s clear application of legal principles that show that Chevron Canada Limited is a separate legal entity that cannot be dragged into this fraudulent litigation,” he said.


Two days after the Canadian ruling, the Supreme Court of Gibraltar issued a judgment against Pablo Fajardo, Luis Yanza, Ermel Chavez, Frente de Defensa de la Amazonia and Servicios Fromboliere for their role in a conspiracy to procure and attempt to enforce the Ecuadorian judgment against Chevron and  awarded Chevron Corporation $38 million in damages and interest and issued a permanent injunction against the defendants, preventing them from assisting or supporting the case against Chevron in any way, according to a Chevron statement.

Fajardo, Yanza and Chavez are Directors at Amazonia Recovery Ltd., a Gibraltar-based company set up to receive and distribute funds that the co-conspirators hoped to obtain from the corrupt Ecuadorian judgment.

The company was established in 2012 by American attorney Steven Donziger.

“In issuing this decision, the Supreme Court is holding the perpetrators of this fraudulent enterprise accountable for their actions,” R. Hewitt Pate said. “In courtrooms around the world, this fraudulent scheme against Chevron Corporation continues to implode.” 


The two rulings in Canada and Gibraltar came after the Superior Court of Justice  of Brazil (STJ)  reaffirmed on May 16 its rejection of the plaintiff's attempt to recognize in Brazil the Ecuadorian verdict.

In November 2017, the STJ ruled, in a unanimous vote, that the Ecuadorian ruling could not be recognized in Brazil, making it therefore unenforceable in the largest country in South America. In a "motion of clarification "recently filed, the plaintiffs requested that the written decision that denies the recognition was modified to include in its conclusions a statement that the STJ's denial was not about the merits of the case.

"The plaintiffs' attempts to partially save their already denied fraudulent sentence have been firmly rejected,” Chevron said in a statement. “We remain confident that any jurisdiction that examines the facts of this case and the misconduct of the plaintiffs, you will find that the Ecuadorian sentence is illegitimate and unenforceable." 

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