Chevron wins key US appeal in Ecuador pollution case

Chevron scored a win Monday in US appeals court, blocking enforcement of a $9.5 billion judgment in Ecuador against the US oil giant over pollution in the South American country.

A three-judge panel of the US appeals court in New York upheld a 2014 ruling by a US District Court that discarded the Ecuador ruling on pollution in the Amazon jungle on the grounds that it was fraudulently obtained.

The appeals court found "no basis for dismissal or reversal," it said. "The judgment of the district court is affirmed."

The case concerns long-running efforts by indigenous people of Ecuador's Lago Agrio region to win compensation for the mass dumping of oilfield waste between the 1970s and 1990s.

The environmental destruction allegedly was perpetrated by Texaco, which Chevron bought in 2001.

Ecuadoran courts ordered Chevron to pay $9.5 billion in compensation.

However, the US oil giant fought back hard, leading to a 2013 trial in New York that alleged widespread corruption in Ecuador's judicial system led by US attorney Steven Donziger, who has represented indigenous groups.

Following that trial, US District Judge Lewis Kaplan ruled that lawyers for the Ecuadoran groups committed a host of corrupt actions, including ghost-writing the original judgment, submitting fraudulent evidence and bribery.

Chevron said it was pleased Kaplan's decision was upheld.

"This decision, which is consistent with the findings of numerous judicial officers in the United States and South America, leaves no doubt that the Ecuadorian judgment against Chevron is the illegitimate and unenforceable product of misconduct," Chevron general counsel R. Hewitt Pate said.

Representatives for indigenous groups criticized the latest ruling and said it would not deter efforts to bring Chevron to justice in Canada and other jurisdictions where they have sought to seize Chevron assets.

They said they were exploring "further review" of the matter.

"Never before has a US court allowed someone who lost a case in another country to come to the US to attack a foreign court's damages award," said Deepak Gupta, an attorney for Donziger.

"The decision hands well-heeled corporations a template for avoiding legal accountability anywhere in the world."