Thursday, June 8, 2023 | Back issues
Courthouse News Service Courthouse News Service

As Chevron’s RICO Case Heats Up,|Opposing Counsel Regrets Nothing

MANHATTAN (CN) - A lawyer said he has "absolutely no apologies to make" for his handling of a multibillion environmental case in Ecuador that Chevron has called extortionate.

New York-based attorney Steven Donziger has been defending himself for more than two years against Chevron's allegations that his efforts to hold the company liable environmental devastation to the Ecuadorean Amazon amounted to a fraud upon the court. He has turned over his journal, financial records and once-privileged attorney client communications to Chevron pursuant to a court order, and he submitted to 19 days of deposition over the course of several months, a grilling that he calls record-breaking.

Decrying Chevron's quest to annul the judgment as "the most well-funded corporate retaliation campaign in history," Donziger opened himself up to more questioning by volunteering to testify and face examination before his longtime rival, Chevron attorney Randy Mastro of the firm Gibson, Dunn and Crutcher.

Mastro began his second day of cross-examination Tuesday by asking Donziger what funder agreed to invest in his legal defense this past spring. The question was portentous because Burford Capital, a prior investor for the Ecuadoreans, withdrew its support from the case and signed up as a Chevron witness.

Donziger at first refused to answer because he said that investor only agreed to support the case pursuant to a confidentiality agreement.

When U.S. District Judge Lewis Kaplan, who is hearing the case without a jury, overruled, however, Donziger was forced to reveal that Woodsford Litigation funded $2.5 million earlier this year.

Questioning turned ugly as Mastro brought up a court battle from Florida in which Donziger claimed his signature had been forged by his late father, Michael Donziger, on an inheritance from grandfather Leon Donziger. Steven Donziger replied that he made "nothing" on the lawsuit, but Mastro pressed on.

One spectator seated in the courtroom could be heard muttering "disgusting" at the line of inquiry.

Donziger and his attorney agreed later that they found the questions inappropriate if not surprising. The inheritance, Donziger added, came from his grandfather's Laundromat business and operation of a skating rink.

Mastro meanwhile tried to use Donziger's personal squabble to buttress his next questions about Richard Cabrera, an Ecuadorean court-appointed expert who Chevron claims allowed portions of his scientific report to be ghostwritten by the oil giant's opponents.

"You appreciate it's wrong to forge signatures on court documents," Mastro asked.

"Of course I do," Donziger replied.

Donziger acknowledged that the scientific firm that the Ecuadoreans retained, Stratus Consulting, wrote the executive summary of the Cabrera report and organized some of the annexes.

Still, he insisted that such coordination was not illegal under Ecuadorean law and the science behind the Cabrera report was sound.

Chevron, on the other hand, claims that Donziger got Cabrera into his position by blackmailing Ecuadorean Judge German Yanez who was embroiled in a sex scandal during that period.

Mastro alleged that an entry from Donziger's litigation notes showed that Ecuadorean lawyers threatened to file a complaint against the judge if their demands were not met. The passage he displayed in court started: "We wrote up a complaint against Yanez, but never filed it while letting him know we might file it if he does not adhere to the law and what we need."

After Yanez ruled in their favor, the judge told Donziger's co-counsel Luis Yanza that "we needed to back him now as he fights to survive in the court," according to the notebook.

The very next line of this entry, however, shows Donziger's rueful reaction to the judge's comment.

"So instead of a strong judge who sees the viability of our case, we now might have a weak judge who wants to rule correctly for all the wrong, personal reasons," the journal states.

Donziger said he never threatened Yanez about the skeletons in the judge's closet, which he said were public knowledge long before the appointment of Cabrera.

He called that the allusion to Yanez's scandal in his notes a "dramatic flair."

Later in his testimony, Donziger said it was "the nature of my personality" to "speak from the hip in a way that is not productive."

He restrained his natural exuberance on the witness stand, looking calm and alert while parrying Mastro's questions with detailed and measured answers. By contrast, the animated Mastro used plenty of rhetorical flourishes, ending his examination with, "Mr. Donziger, I have nothing further for you."

Donziger emphatically denied that he authorized judicial bribes to secure the judgment against Chevron, an allegation that rests on the word of Alberto Guerra, the first judge to hear the case in Ecuador.

Both sides agree that Pablo Fajardo, the lead Ecuadorean attorney fighting Chevron, arranged for Donziger to meet with Guerra in late 2010 at the Quito-based restaurant Honey Honey, but they dispute what the two discussed.

Guerra claims that he agreed at the meeting to secretly write the verdict for the final judge, Nicolas Zambrano, in return for both of them getting a cut of award.

In his witness statement, Donziger said he agreed to the meeting only to learn whatever "courthouse gossip" Guerra might have, and that the judge floated an idea of a $500,000 bribe to ghostwrite the judgment that he found abhorrent. Donziger emphasized that point during his live testimony.

"I would never do that," Donziger testified. "Whatever money we had would not be used to bribe a judge."

The Ecuadoreans cast doubt on Guerra's credibility because he admitted to accepting tens of thousands of dollars in cash from Chevron in a suitcase and entering a contract for at least $326,000 total on top of the services of an immigration lawyer, plus a car and other perks.

Mastro pointed to two emails from mid-2009 that he alleges speak of bribes through "code names" of a "puppet" and "puppeteer." One said, "The puppeteer won't move his puppet unless the audience pays him something."

Donziger said that neither of these words referred to Zambrano, who entered the case in 2010 and rejected Chevron's allegations. Fighting the "code" allegation as well, Donziger said that lawyers for the Ecuadoreans often used "nicknames" during this time, "generally for reasons of confidentiality and humor."

The trial pauses on Wednesday as lawyers for the Ecuadoreans determine whether more witnesses will be able to testify for their side. Chevron is expected to present a short rebuttal case as early as Thursday, to be followed by closing arguments.


Read the Top 8

Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.