Chevron Accuses Ecuadorean Judge of Bribery, Seeks His Removal

Chevron Corp. said it will seek to replace an Ecuadorean judge overseeing a $27 billion environmental lawsuit against the company, claiming videotapes show him saying he would rule against Chevron in meetings with businessmen seeking pollution cleanup work.

Chevron says a company contractor and an American businessman used a pen and watch with tiny cameras to secretly record meetings they had with Judge Juan Nunez and a Quito political coordinator for Alianza Pais, the party of Ecuador President Rafael Correa.

The two were seeking to gain contracts to clean up chemical waste in the Amazon basin that may be awarded if Nunez rules against the company. The political coordinator sought $3 million in bribes to deliver the contracts and claimed Nunez would get a one-third cut, Chevron said yesterday in a statement today.

“No judge who has participated in meetings of the type shown on these tapes could possibly deliver a legitimate decision,” Charles James, Chevron senior vice president, said in the statement.

The contractor, Diego Borja, worked for Chevron delivering equipment and assisting in soil inspections that Nunez conducted in recent months as part of a lawsuit seeking damages from the company for pollution allegedly left by Texaco Inc. before it was acquired by Chevron in 2001.

While under contract with Chevron during the inspections earlier this year, Borja was also soliciting cleanup work that might result from the lawsuit, said Kent Robertson, a Chevron spokesman. At one meeting which was recorded, Nunez said he would rule against Chevron and the damage award funds for cleanup would go to the government and not the plaintiffs, the company said.

Relocation Expenses

Borja has received relocation expenses and other assistance from the company out of concern for his safety, Chevron said. Robertson declined to say how much Borja has been paid or provide contact information for Borja. All four videotapes of Borja’s meetings in May and June were made without the company’s knowledge, Chevron said in its statement. Neither Borja or the American were paid for the tapes, the company said.

Chevron, the second-largest U.S. oil company, said it sent the recordings to Ecuador’s top prosecutor and the U.S. Justice Department and will seek to disqualify Nunez, president of the Nueva Loja Superior Court, and have all his prior rulings annulled. He was expected to rule in the next few months whether Chevron should pay as much as $27 billion in damages.

Watch, Camera

At a meeting not attended by Nunez, the political coordinator, Patricio Garcia, told Borja $1 million would go to Nunez and $1 million would go to the “presidency,” the San Ramon, California-based company said in its statement. Another $1 million would go to the lawsuit’s plaintiffs, according to an English translation of the tapes posted on the company’s Web site. Borja used a watch with a tiny camera to record the meetings, according to transcripts.

Calls to Nunez’s office in Lago Agrio, Ecuador, weren’t immediately returned. There was no listing in Ecuador phone books for Garcia in the country’s internal revenue service database of taxpayers.

Wayne Hansen, the American businessman seeking contracts with Borja, attended the meetings and recorded them with a tiny camera on a pen, according to the Chevron transcripts. Hansen couldn’t be reached for comment yesterday. Chevron said he has no connection to the company.

Ecuador’s Prosecutor General Washington Pesantez yesterday received the complaint filed by Chevron’s lawyer and will open an investigation, spokeswoman Gloria Mejia said in a phone interview.

‘No Evidence’

“As of this date, the government of Ecuador has received no evidence from Chevron, only allegations,” according to an e-mailed statement from the Ecuador embassy in Washington. “A preliminary review fails to reveal any evidence that the Government of Ecuador has been engaged in any corrupt acts regarding the ongoing environmental trial.”

The government will take “the appropriate action against the offending individuals” if the allegations are valid, the embassy statement said. The government is seeking all videotapes from Chevron, not just the ones posted on its Web site, which are “heavily edited,” according to the statement.

Fernando Alvarado, a spokesman for Ecuador president Rafael Correa, didn’t immediately return a call for comment yesterday.

“Any investigation has to focus on Chevron and whether this is a dirty trick,” said Steven Donziger, an attorney representing Ecuadoreans suing Chevron in the 15-year-old lawsuit. “It certainly looks like a dirty trick. It’s unclear what role the judge played.”

President’s Adviser

Chevron said in its complaint that Alexis Mera, chief legal adviser to Correa, instructed Nunez on how to distribute the damages from the lawsuit.

Mera told reporters in Quito that Chevron is committing a crime by intercepting conversations and denied knowing Nunez or trying to influence the case.

“Ecuador is indifferent regarding the outcome of the lawsuit as it is not a participant,” Mera said.

Chevron is being sued on behalf of 30,000 Amazon-basin residents on claims that Texaco dumped toxic waste from oil drilling in the jungle from 1964 to at least 1990. The case began in 1993 in New York and now is being handled in a court in Lago Agrio.

Lingering Spills

Chevron has said Texaco cleaned up its share of any lingering spills in exchange for a release from future liability before state-owned PetroEcuador took control of the operations almost two decades ago.

Chevron questioned the impartiality of a court-appointed expert who estimated damages in the case and claims there’s little factual data to support the $27 billion estimate. Chevron also said, before the videotapes surfaced, that the Ecuadorean government has influenced the case against the company.

Nunez, a former Ecuadorean Air Force officer, heads the highest judicial body in Ecuador’s northeastern Sucumbios province. He has overseen the case since 2008 and will decide the lawsuit without a jury, as is customary in Ecuador’s legal system. In civil cases, judges gather evidence from witnesses, documents and experts before reaching a decision.

Nunez said last year his task is to decide what damage has been done and who is responsible.

“There are people who are dying or have died,” he said in an interview at his office last year.

The Justice Department declined to comment, said Laura Sweeney, a spokeswoman.

Exxon Corp. is the largest U.S. oil company.

(Published by Bloomberg - September 1, 2009)