December 17—A court of appeal in Ontario, Canada this morning just dealt Chevron a stunning reversal of fortune in its long attempt to evade paying the Ecuador environmental judgment. The decision is attached; a press release with additional comment is forthcoming.
CLICK HERE to view and/or download the court order (PDF).
In summary, the Court of Appeal for Ontario ruled that Ecuadorian indigenous and farmer communities indeed have the right to pursue all of Chevron’s assets in Canada to enforce the $9.5 billion Ecuador judgment. This is significant because Chevron’s assets in Canada are estimated to be worth $15 billion. Thus, the entirety of the Ecuador judgment can be collected in Canada if the communities prevail on their enforcement action.
The key summary points of the appellate court’s ruling are as follows:
- Canadian courts have jurisdiction over Chevron for purposes of enforcement of the Ecuador judgment – rejecting Chevron’s main argument on appeal.
- The appeals court ruled that the trial court judge erred in imposing a stay on the enforcement action and that Chevron must now file a statement of defense, the first step toward an eventual trial on recognition of the Ecuador judgment.
- The court seemed to suggest that Chevron’s subsidiaries in Canada — mainly Chevron Canada — will be subject to corporate veil piercing although the final decision was left to the trial court as part of the enforcement action.
Some of the court’s relevant language is as follows:
From par. 70: “In these circumstances, the Ecuadorian plaintiffs do not deserve to have their entire case fail on the basis of an argument against their position that was not even made, and to which they did not have the opportunity to respond.”
From paragraphs 74-75:
“Even before the Ecuadorian judgment was released, Chevron, speaking through a spokesman, stated that Chevron intended to contest the judgment if Chevron lost. He said: ‘We’re going to fight this until hell freezes over. And then we’ll fight it out on the ice.’ “
“Chevron’s wish is granted. After all these years, the Ecuadorian plaintiffs deserve to have the recognition and enforcement of the Ecuadorian judgment heard on the merits in an appropriate jurisdiction. At this juncture, Ontario is that jurisdiction.”