How Corporate Tyranny Works
CAPITALISM, 31 Aug 2020
Those, like environmental lawyer Steven Donziger, who fight the corporate control of our society on behalf of the vulnerable, find that the institutions of power unite to crucify them.
25 Aug 2020 – The persecution of the attorney Steven Donziger is a grim illustration of what happens when we confront the real centers of power, masked and unacknowledged by the divisive cant from the Trump White House or the sentimental drivel of the Democratic Party. Those, like Donziger, who name and fight the corporate control of our society on behalf of the vulnerable see the judiciary, the press and the institutions of government unite to crucify them.“It’s been a long battle, 27 years,” Donziger said when I reached him by phone in his apartment in Manhattan.
Donziger, who has been fighting polluting American oil companies for nearly three decades on behalf of indigenous communities and peasant farmers in Ecuador, has been under house arrest in Manhattan for a year. He will go to trial in federal court in New York on September 9 on contempt of court charges, which could see him jailed for six months. Ever since he won a multibillion-dollar judgment in 2011 against the oil giant Chevron, the multinational has come after him personally through litigation that threatens to destroy him economically, professionally and personally.
“Our L-T [long-term] strategy is to demonize Donziger,” Chevron wrote in an internal memo in 2009, as reviewed by Courthouse News.
“It started when Texaco went into Ecuador in the Amazon in the 1960s and cut a sweetheart deal with the military government then ruling Ecuador,” Donziger told me. “Over the next 25 years, Texaco was the exclusive operator of a very large area of the Amazon that had several oil fields within this area, 1500 square miles. They drilled hundreds of wells. They created thousands of open-air, unlined toxic waste pits where they dumped the heavy metals and toxins that came up from the ground when they drilled. They ran pipes from the pits into rivers and streams that local people relied on for their drinking water, their fishing and their sustenance. They poisoned this pristine ecosystem, in which lived five indigenous peoples, as well as a lot of other nonindigenous rural communities. There was a mass industrial poisoning.”
“By the time I went down there in the early 1990s, many people had died, cancer rates were skyrocketing according to several independent health evaluations, people were really hurting. There was zero regard for the lives of the local people by Texaco. I was a very young lawyer back in 1993 when I first went to Ecuador. It was like looking at an apocalyptic scene. There was oil on the roads. People were living in abject poverty. They had no shoes. They would get oil on their feet when they walked along the roads. The oil pollution had permeated every aspect of daily life. It was in the food supply. It was in the water supply. It was in the air. The average person there would get exposed multiple times a day to very harmful, cancer-causing toxins, with foreseeable results.”
“I, with other lawyers, filed a lawsuit in New York against Texaco. The reason we filed in New York was because Texaco’s headquarters were in New York in 1993. The decisions to pollute in Ecuador, to play God to the people of Ecuador, were made in New York. We sued in New York. Texaco tried to get the case back to Ecuador where they had never been held accountable, where they knew the indigenous peoples had no money or resources to find lawyers.”
“They thought it would just go away,” said Donziger. “Over a 10-year period, we battled to get a jury trial in the United States. Ultimately, they won that part of the battle. It went down to Ecuador.”
“We started working with a team of Ecuadoran lawyers in the early 2000s. We went forward with the lawsuit. We produced voluminous scientific and testimonial evidence, showing that they caused probably the world’s worst oil pollution. It was called the ‘Amazon Chernobyl’ by locals and experts. They dumped 16 billion gallons of toxic waste. They did it deliberately to save money. This was unlike the BP spill in the Gulf of Mexico, which was a terrible accident, even though it was a product of horrendous negligence by BP. This was done by design to pollute, knowing that people would die, and that indigenous groups would be decimated, and that this beautiful part of the Amazon would be destroyed.”
The refusal to abide by even minimal environmental regulations saved Texaco an estimated $3 on every barrel of oil produced over 26 years (1964-1992), according to Amazon Watch, or an estimated extra $5 billion in revenue. The hundreds of waste pits the company eventually abandoned in Ecuador, on average, contain 200 times the contamination allowed by typical global standards.
“They tried to grind us down using classic corporate defense tactics,” Donziger said of the legal war. “They filed thousands of motions. We stood strong. We had a great legal team of Ecuadorian lawyers.”
In the end, they won a stunning victory, a rare moment of accountability for first-world conglomerates who rape the environment of developing nations by exploiting weak, corrupt governments.
“The verdict came down, about $18 billion in favor of the affected communities, which is what it would take at a minimum to clean up the actual damage and compensate the people for some of their injuries. That eventually got reduced on appeal in Ecuador to $9.5 billion, but it was affirmed by three appellate courts, including the highest court of Ecuador. It was affirmed by the Canadian Supreme Court, where the Ecuadorians went to enforce their judgment in a unanimous opinion in 2015.”
Chevron, as the evidence mounted against it, sold their assets in Ecuador and left the country. The corporation threatened the plaintiffs with a “lifetime of litigation” if they attempted to collect, and, according to internal Chevron memos, launched a legal and media campaign that has cost an estimated $2 billion to prevent payment of the settlement and to demonize and destroy Donziger.
Donziger came to his epic battle against Chevron through journalism. “I was a journalist on my college newspaper,” he said of his time as a history major at American University. “My first job out of college was as a journalist with [United Press International]. I worked for UPI in Washington. They were strong in Latin America. I traveled to Managua in 1983 or 1984, I don’t remember exactly, and found work in the UPI bureau. I was 23 years old. I worked in the UPI bureau in Managua during the Sandinista era.”
He left UPI after a year in Managua but stayed on in Nicaragua to work as a freelance journalist for newspapers such as The Fort Lauderdale News, The Toronto Star and The Atlanta Constitution. He spent about three years as a reporter before going to Harvard Law School. When he graduated from Harvard Law School in 1991, he worked as a public defender in Washington, D.C. He documented Iraqi civilian casualties in Iraq following the first Gulf War that became a report adopted by the United Nations.
A classmate at law school was from Ecuador. His classmate’s father organized a trip in April 1993 for lawyers and medical professionals to look at the contamination caused by the oil extraction in the Amazon. That trip, which Donziger joined, spawned the suit against Texaco. He would make more than 250 trips to Ecuador over the next two decades.
“Journalism significantly shaped my views and skill set,” he said. “It was vital to allowing my work to be successful. From the beginning this was a unique litigation, for many reasons, but one of the reasons was we, as a team, decided to work across multiple platforms. If we only saw this case as a lawsuit we would never win.”
“Chevron controlled the legal system in Ecuador with their influence. We needed to operate across different platforms, including engaging with the media and carrying out significant public education. Most Ecuadoreans, other than those who lived in the region, knew nothing about the pollution that had been happening in their country. We carried out zealous advocacy in the public arena. We realized that the indigenous people would never get a fair trial in Ecuador if they did not illuminate what had happened to them and get public support.”
“The fact that I am detained shows how far we’ve come and how much risk Chevron feels. It’s not a sign we lost. It’s the opposite.”
— Steven Donziger
Both the judge who oversaw its lawsuit against Donziger for “racketeering” and Chevron itself “claim that this type of activity is wrong,” he said. “The irony is that what we were doing is what the big oil companies have always done. They always operate in the public relations domain, lobbying Congress to pass legislation to extinguish various legal claims, meeting political leaders behind the scenes. They operate across every platform they can find to exercise their power. We were smart enough to meet them toe-to-toe wherever they were operating and neutralize their ability to undermine the fairness of the trial. That’s how they operate. They try to control court systems.”
“My journalism [experience] sensitized me to injustice. It allowed me to understand the media. I knew how to write press releases, which matters when you do a public case like this. I knew how to work across different platforms to mobilize positive energy around the case. Human rights work involves, first and foremost, justice for victims. But equally important is accountability for the perpetrators. The fact that I am detained shows how far we’ve come and how much risk Chevron feels. It’s not a sign we lost. It’s the opposite.”
Chevron, which had left Ecuador, went back to the New York court, where Donziger had originally filed the lawsuit before Chevron got a change of venue to Ecuador, and sued him, using a civil courts portion of the federal law famous for breaking the New York Mafia in the 1970s, the Racketeer Influenced and Corrupt Organizations Act.
In effect, “They sued me as a civil racketeer, under a civil RICO statute for $60 billion,” he said. “That was the largest amount of money an American individual ever had been sued for. This began a ten-year campaign to demonize me by Chevron and by its judicial allies.”
Chevron, which has more than $260 billion in assets, has hired an estimated 2,000 lawyers from 60 law firms to carry out its campaign, according to court documents. The oil giant dropped its demand for financial damages weeks before the RICO trial, which would have necessitated a jury trial. Judge Lewis A. Kaplan, a former lawyer for the tobacco industry who had undisclosed investments in funds with Chevron holdings, according to his public financial disclosure statement, decided the RICO case alone. He found credible a witness named Alberto Guerra, relocated to the US by Chevron at a cost of some $2 million, who claimed the verdict in Ecuador was the product of a bribe. Kaplan used Guerra’s testimony as primary evidence for the racketeering charge, although Guerra, a former judge, later admitted to an international tribunal that he had falsified his testimony.
“[Kaplan] wouldn’t allow me to bring in any environmental evidence that the Ecuadorian courts had used to find Chevron liable,” Donziger said. “He wouldn’t let me testify on my own behalf on direct. He allowed Chevron to use secret witnesses whose identities he wouldn’t reveal to me. He tried to treat it like a national-security kind of case to try to demonize me. Because Chevron’s whole strategy is to demonize [me] as a way to distract attention from its environmental crimes in Ecuador. And Judge Kaplan, who knows all the tricks in the books because he used to work for [tobacco company] Brown & Williamson, when he was [an attorney with the law firm of] Paul, Weiss. He knows the tobacco industry playbook that they used for years and years and continue to use. And he worked with the Chevron lawyers at Gibson, Dunn & Crutcher to implement them against me without a jury. And there was nothing I could do about it.”
(Paul, Weiss is a large law firm that currently advises Chevron on its $13 billion purchase of another energy company.)
John Keker, one of Donziger’s lawyers on that case, said he was up against 160 lawyers for Chevron and during the trial he felt “like a goat tethered to a stake.” He called the court proceedings under Kaplan “a Dickensian farce” and a “show trial.” In the end, Kaplan ruled that the judgment in the Ecuadorean court against Chevron was the result of fraud.
He also ordered Donziger to turn over decades of all client communication to Chevron, in effect eradicating attorney-client privilege, a backbone of the Anglo-American legal system with roots dating to ancient Rome. Donziger appealed what was, according to legal experts following the case, an unprecedented and illegal order. While Donziger’s appeal was pending, Kaplan charged him with criminal contempt for this principled stance, as well as his refusal to turn over his passport, his personal electronics and to refrain from seeking the collection of the original award against Chevron.
When his criminal contempt charges against the environmental lawyer were ignored by the U.S. attorney’s office for over five years, Judge Kaplan, using an exceedingly rare judicial maneuver, appointed the private law firm of Seward & Kissel, to act in the name of the government to prosecute Donziger. Neither the judge nor the law firm disclosed that Chevron has been a client of Seward & Kissel.
Kaplan also violated the established random case assignment protocol to personally assign Loretta Preska, a member of the right-wing Federalist Society, to hear the case. Chevron is a major donor to the Federalist Society. Preska, in a show of bias, already has said the charges against Donziger appear to be “very strong,” according to Courthouse News. In May, she disallowed him from having his charges heard by a jury.
“The last thing any of them wants is for a group of ordinary citizens to see what has happened to Steven Donziger,” Rick Friedman, one of Donziger’s attorneys, said of Chevron.
“The last thing any of them wants is for a group of ordinary citizens to see what has happened to Steven Donziger.”
–Rick Friedman, attorney
Preska’s fealty to corporate power was previously on public display in 2013 when she imposed a 10-year sentence, the maximum allowed under a plea deal, on Jeremy Hammond, the activist who hacked into Stratfor, a private security firm. Hammond made public a barrage of damning internal emails and exposed the email address and password of an account used for business by Preska’s husband, Thomas Kavaler, a partner at the law firm Cahill Gordon & Reindel. Preska, despite the conflict of interest, refused to recuse herself. The 10-year sentence was one of the longest in U.S. history for hacking.
Kaplan had Preska demand Donziger post an $800,000 bond on a misdemeanor charge. Preska placed him under house arrest and confiscated his passport which he has used to meet with attorneys around the world attempting to enforce the judgment against Chevron. Kaplan managed to have Donziger disbarred. He allowed Chevron to freeze Donziger’s bank accounts, slapped Donziger with millions in fines without allowing him a jury, forced him to wear an ankle monitor 24 hours a day and effectively shut down his ability to earn a living. Kaplan allowed Chevron to impose a lien on Donziger’s apartment in Manhattan where he lives with his wife and teenage son.
Donziger is scheduled to go to trial without a jury on September 9 in New York City for contempt. Preska will preside over the trial. There has not been a criminal trial in Manhattan federal court since March because of the pandemic. Donziger’s trial would be the first, although hundreds of other defendants facing far more serious felony charges are waiting in jails, infested with COVID-19, for a trial date. Donziger’s four pro bono lawyers said they do not want to risk their lives by traveling to New York during the pandemic for what is a misdemeanor offense.
“The judgment against Chevron Corporation in Ecuador was the product of fraud, bribery and corruption,” Sean Comey, Senior Advisor – External Affairs Chevron Corporation said when I asked the corporation to comment on the case. “Steven Donziger is a proven liar and an adjudicated racketeer. He committed criminal acts in the U.S. and abroad in pursuit of his extortion scheme in the Ecuadorian courts. Donziger’s continuing lawlessness is now a matter for prosecutors and the U.S. courts to decide. Chevron is not involved in Donziger’s criminal prosecution.”
The flagrant corruption and misuse of the legal system to abjectly serve corporate interests in the Donziger case illustrates the deep decay within our judiciary and democratic institutions, one that was abetted by Democratic administrations that stacked the courts with corporate lawyers – Kaplan was appointed by Bill Clinton – and Donald Trump, who has elevated ideologues selected by the Federalist Society to the federal bench. Ruling after ruling in Donziger’s case has ignored or grossly distorted the law on behalf of Chevron to ensure that Donziger will be prosecuted, sent to prison and remain in debt for life – all while the $9.5 billion settlement is never paid to aid the people harmed in Ecuador.
The International Association of Democratic Lawyers and the international committee of the National Lawyers Guild issued a letter signed by more than 70 organizations calling the persecution of Donziger an “attack on the rule of law.” The letter said his house arrest was “unprecedented” and charged that he was being targeted for what it called “one of the most important corporate accountability and human rights cases of our time.” The letter accused Kaplan of “violating basic notions of fairness in the judicial process that lie at the core of the rule of law.”
“We cannot allow the rule of law to be upended by corporate interests and a highly biased federal judge seeking to destroy the willpower of one lawyer who has already withstood decades of brutal litigation and scathing personal and professional attacks,” the letter read.
Chevron has also used its clout and advertising dollars to keep the story from being reported in numerous media outlets.
“Based on where this story is trending, we have launched a full offensive to kill it or redirect it,” an August 10, 2010 internal memo from Chevron reads concerning a potential report on the case being done by the Fox News bureau in Miami.
“In addition to working through the Miami bureau, we have reached out to more senior news folks at Fox News, both in NY (through Dana) and in WDC (through Greg Mueller). So, we are trying to attack this story on multiple fronts. To this end, Kent is set to talk to John Stack and Sean Smith who both reside at Fox News in NY at 1:30 today. Finally, if need be, I think we may need to pull the JSW card with Roger Ailes. We have checked John’s availability to place a call to Roger, but his first availability is tomorrow afternoon.”
From 2010 to 2018, John S. Watson was the CEO and chairman of the Chevron Corporation.
The story was killed.
Another internal memo lays out the steps, also ultimately successful, to prevent a similar story from appearing in GQ magazine. The memo suggests that Chevron work “with the Columbia Journalism Review (that ran the rebuke of 60 minutes) and the Media Research Center to expose any degree of bias by GQ and raise alerts about the reporting techniques prior to the story’s publication.”
The memo recommends letting the magazine know that it will face legal action if the story runs and calls on Chevron investigators to “conduct further due diligence on reporter.” Chevron has also hired reporters to produce fake pieces of journalism that peddle the corporation’s propaganda on fake news sites it runs.
The New York Times magazine earlier this year considered a story about Donziger and then dropped it. The newspaper runs its own ad agency called T Brand Studio. Chevron is a major client, meaning The New York Times, through T Brand Studio, produces ads for Chevron.
Jake Silverstein, editor of the magazine, when asked to comment said by email: “It was one of several stories William [Langewiesche] considered writing for us in the past year, one that ultimately we decided not to assign. Many factors go into our decisions about what to assign, and none of them ever include who is or is not a client of T Brand Studio or any other part of the paper’s advertising business.”
Dean Baquet, the newspaper’s executive editor, said, when I reached him by email, that the idea that the magazine piece on Donziger was killed because Chevron is a major advertiser is “a ridiculous claim.” He added, “I didn’t even know Chevron worked with T Brand [Studio].”
But that Chevron has invested tremendous resources to kill stories about this case is indisputable given the detailed campaigns to block coverage outlined in its own internal memos.
“I’ve experienced this multiple times with media over the past 10 to 15 years,” Donziger said. “An entity will start writing the story, spend a lot of time on it, then the reporter disappears. The story doesn’t run.”
“Corporate influence over our federal judiciary has increased dramatically in recent years,” Donziger said. “This firm [Chevron] has captured an element of power from the government and deployed it against a human rights activist.”
Front Line Defenders issued a report in 2019 that found that 300 human rights activists had been murdered in 31 countries, more than two-thirds in Latin America. Of those killed, 40 percent fought for land rights, indigenous peoples and environmental justice.
“What’s shocking to a lot of people is that this is now happening in the United States,” Donziger said. “I don’t mean murder, but death by a thousand cuts. Chevron does not want me to be a lawyer anymore, at a minimum. They don’t want me advocating even as a nonlawyer. They want to silence me. They want to kill every story they can. They’d rather have no story about this case than even a positive story about their side. They don’t want people to know about it. They want to erase it from people’s thought process.
“I cannot get a fair trial with a judge appointed by Judge Kaplan rather than though the random assignment process,” he lamented. “I cannot get a fair trial with a prosecutor whose law firm [has worked] for Chevron. These are egregious conflicts of interest. It’s misconduct on a grand scale. I’ve been locked up four times as long as the longest sentence ever imposed on a lawyer for criminal contempt in New York. Anyone who cares about the rule of law should be appalled.”
Chris Hedges is a Pulitzer Prize–winning journalist who was a foreign correspondent for fifteen years for The New York Times, where he served as the Middle East Bureau Chief and Balkan Bureau Chief for the paper. He previously worked overseas for The Dallas Morning News, The Christian Science Monitor, and NPR. Until this month, he wrote a weekly column for the online magazine Truthdig. He is the host of the Emmy Award-nominated RT America show On Contact.
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