The Politics of Poverty

Ideas and analysis from Oxfam America's policy experts

An $8 billion decision against Chevron – what does it mean?

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The case reflects a broader pattern of corporate impunity. As companies seek resources and markets in ever more remote corners of the world, over-burdened, under-resourced, often corrupt governments and courts, with limited jurisdiction, pose little threat.

One of hundreds of open oil pits left by Texaco in the Amazon.  Photo by Coco Laso/Oxfam America.
One of hundreds of open oil pits left by Texaco in the Amazon. Photo by Coco Laso/Oxfam America.

As David and Goliath stories go, it would be tough to match the struggle between poor, marginalized communities and one of the most powerful companies in the world, Texaco (now merged with Chevron), facing off in the Ecuadorian Amazon. That those communities just won a record-breaking $8.6 billion decision against the company is remarkable. The case is far from over – Chevron will continue to “fight until hell freezes over, and then skate on the ice” (in the words of its prior General Counsel) – but some initial reflections are in order.

I made my first trip to the region in 1993 as part of a rag-tag team of lawyers searching for potential plaintiffs for this quixotic case against Texaco. At the time, Texaco had just departed Ecuador, leaving over 900 open waste pits scattered through the jungle and an estimated 18.5 billion gallons of toxic waste dumped into surrounding rivers and streams over a 25-year period. The company, with annual earnings three times the GDP of Ecuador, had been given free rein to open up the Amazon and dispensed with any efforts to protect the environment or population.

We had no trouble finding plaintiffs – people were surrounded by the waste and contamination, which was openly seeping into their only sources of water. An estimated 30,000 people were affected by Texaco’s operations (one group of indigenous peoples disappeared). When the company finished it simply walked away.

Cutting through the background noise and legal wrangling, there should be little doubt about Texaco’s (and now Chevron’s) culpability. Yes, the state oil company has since done additional damage to that area and yes, under pressure, the company came back and did superficial remedial work, consisting largely of filling a portion of the pits with dirt, but neither absolves the company for the extensive environmental damages and harm suffered by communities.

Legal liability is a different matter. Chevron-Texaco has gone to extraordinary lengths to fight the charges and the initial suit has spawned litigation across a dozen courts. Despite the very heartening decision by the Ecuadorian judge, the plaintiffs may never ultimately prevail. The case reflects a broader pattern of corporate impunity. As companies seek resources and markets in ever more remote corners of the world, over-burdened, under-resourced, often corrupt governments and courts, with limited jurisdiction, pose little threat. This case is an anomaly in how much legal attention it’s received; a tiny sliver of the other 80,000 multinational corporations operating around the world can expect to face serious legal challenges. Some high profile and worthy efforts to bring these cases to the United States under the Alien Tort Statute have yet to yield a single final legal victory.

That’s not to dismiss the importance of litigation. Even a losing case, can do much good; but it has to be part of a broader strategy. The lawsuit against Texaco joined nascent local organizing; it injected critical energy, attention, and focus to help mobilize communities, NGOs, and social movements (indigenous, environmental, religious). They formed a network – the Amazon Defense Front – around the case, which continues to be a major local and national actor on oil issues. With media attention, ministers and congressional representatives were moved to visit the area and passed new laws and policies to govern the oil industry. The case put other companies on notice and it became common to hear oil representatives defend themselves by declaring – “we aren’t Texaco”. When the case was moved from a US court to Ecuador, it forced constructive reforms in the national judicial system and the local courts to meet the unprecedented demands of a class action toxic tort case.

Working with grassroots communities and social movements does not come easy to litigators. It inevitably complicates and politicizes cases and requires much more time and resources. But the alternative risks doing damage to environmental or human rights causes. Cases can provoke and mobilize, but they can just as easily remove critical energy and initiative from local actors to lawyers and distant courtrooms. The rare legal victories won’t get to the roots of problems. Dealing with corporate perfidy in a place like Ecuador requires long-term engagement by local actors; the utility of litigation should be measured against that broader aim.

In that vein, the Chevron-Texaco case prompts one additional reflection: the need for systemic approaches. While Texaco built the roads, dug the wells, dumped the wastes, a compliant Ecuadorian government, weak regulators, a failing judiciary, a complicit state oil company, and pressure from the US government and international financial institutions allowed it to happen. A sustainable solution to destruction in the Amazon requires attention to all of these actors as part of a larger system. That underscores the importance of strengthening local civil society actors, building alliances and leverage at the international level and using new communications tools to connect efforts. It also calls for new legal instruments capable of covering all relevant actors across national boundaries, along the lines of the UN Ruggie Framework and the recently passed Dodd-Frank Financial Reform Legislation.

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  1. samarston@earthlink.net'stephanie marston

    Good article. I heard about this on NPR, but nowhere else. The word needs to get out more in the media, but unfortunately to a great extent the media is owned by the very corporations that perpetrate these crimes.

    Chris Jochnick’s work is truly inspiring.

    Reply
  2. tm4600@gmail.com'Tom Moyer

    If you want to know more detail about how the Texaco destruction occurred, read “Confessions of an Economic Hit Man” by John Perkins. This same sort of story happened in many other countries including Indonesia and Saudi Arabia. All in the name of getting more money for the elite rich and more oil for the US to burn.

    Reply
  3. jpicson@gmail.com'Jerry Picson

    This struggle is not limited to less-developed countries, but is everywhere that big oil and gas is operating. In the State of Pennsylvania we are currently fighting against the negative environmental and health impacts of natural gas drilling. There are communities in the U.S. without clean water, due to pollution from shale gas drilling. There are people already sick from exposure to water-borne and air-borne toxins, due to the air and water pollution from the gas drilling and processing.

    Here in Pennsylvania, we fight not only against the industry, however, but must wrestle with our own state government, a government that is currently headed by an individual who was put in place via close to US$1 million in campaign contributions from the gas companies. Just yesterday we learned that our state Department of Environmental Protection will not be able to charge any drilling companies with violations (of which there are many) without first passing them through the non-DEP political appointees. Here in the U.S. many of us are already losing our civil rights and our human rights to an increasingly corrupt government. The industry buys enormous amounts of airtime on area television and radio stations, churning out propaganda about how safe this process is. In the meantime, we also have people living right next to open pits full of toxic chemicals, gas flaring, and unannounced pressure releases that spew enormous amounts of toxic gases over communities. We also have the gas industry dumping wastes into our area streams, contaminating people’s only sources of drinking water.

    It doesn’t just happen in poor countries, folks. It happens anywhere this industry operates. There is a huge need for an international campaign against these horrific acts. If what we are seeing done by this industry were done by an enemy in time of war, they would be considered war crimes.

    Reply
  4. mnunez06@gmail.com'Milton Nunez

    Chris:
    I know of this horrible since 1990, have tried to do something about, but it has been wasted time and resources.

    What would you suggest for a campain to become organized, maybe start writing to all governments e.g. of US, UN, EU, LAC etc.?

    These firms act irresponsibly and they know that no one will hold them accountable no only for the impact on nature, but especially to the people they have hurt and are still getting sick from what they did 20 years ago and are still doing (Angola, USA, Nigeria, etc.)

    I know OXFAM has greate specific weight, and has done very good things for countries in their fights for their rights (i.e. Brasil vs. USA and the WTO). Maybe this case could be another vistory for truth and for OXFAM.

    Reply
  5. bunchesca1@comcast.net'kathryn

    When I heard about this, I stopped buying Chevron gas. Now I won’t buy from Texaco. Anyone else I need to boycott? thank you thank you!

    Reply
  6. mikeg@ran.org'Mike G.

    This is a great post. I’d never heard that it was common for oil companies to start saying “We’re not Texaco.” Really speaks volumes about how much the Ecuadorean plaintiffs have been able to accomplish.

    To anyone who is incensed by Chevron’s corporate malfeasance and looking to do something about it, check out the campaigns being run by the Rainforest Action Network and Amazon Watch:

    http://www.changechevron.org

    http://www.chevrontoxico.org

    Reply
  7. Pingback: Ecuador Court Rejects Chevron Arbitration Ruling, Reopening $18 Billion Fine For Amazon Pollution

  8. urbanlife2farmlife@gmail.com'Victor

    I’m particularly interest to know which indigenous group “disappeared” but that link as well as many of the others pointing to http://texacotoxico.org don’t seem to be working?

    Its horrible that history seems to be repeating itself in Ecuador with the disappearance of the uncontacted Taromenane tribe only a few hours south of Texaco’s waste dumps. More information on that sad but similar story here: http://www.chekhovskalashnikov.com/uncontacted-tribe-massacre-ecuador-yasuni/

    Reply

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