Chevron’s high-profile defense against a lawsuit seeking $27bn for environmental damages in Ecuador has ranged from YouTube postings to secretly-taped videos of the judge discussing the case in what it claims is evidence of political interference and corruption in the country. The nature of Chevron’s defence, which has included keeping those who did the secret taping away from media and the authorities, certainly is uncharacteristic of an oil major.
Typically these companies settle cases or do whatever else they can to avoid drawing negative attention to themselves. But, then again, this is no ordinary lawsuit. The damages being sought are extremely high – roughly a quarter of Chevron’s market capitalisation of $140bn or a fifth of its $160bn in assets.
This is, indeed, the biggest environmental lawsuit in history, with the potential for almost seven times the damages awarded against ExxonMobil for the 1989 Exxon Valdez oil spill in Alaska. For this reason, Chevron is refusing to settle, insisting Texaco, which it bought in 2001 to inherit the lawsuit, spent $40m on cleanup when it was pressured to leave Ecuador in 1992. Read more