Canadian Manufacturing

U.S. court rules for Chevron, blocks $9B Ecuador rainforest penalty

Long-running dispute traces back to a 1998 agreement Chevron says absolves the company of liability after paying $40 million in cleanup costs


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NEW YORK—A federal appeals court has ruled that Ecuadorean plaintiffs cannot collect a $9 billion judgment in the U.S. against Chevron for rainforest damage.

The 2nd U.S. Circuit Court of Appeals in New York ruled Aug. 8. The decision upholds a lower-court finding that the Ecuadorean court judgment was obtained by corrupt means.

The appeals court said Judge Lewis Kaplan had the authority to rule as he did. It noted, however, that Kaplan’s decision after trial doesn’t invalidate the Ecuadorian judgment and doesn’t stop the enforcement of the judgment anywhere outside the U.S.

The case resulted from a long-running court battle between Amazon rainforest residents and oil companies.

San Ramon, California-based Chevron had long argued that a 1998 agreement Texaco signed with Ecuador after a $40 million cleanup absolves it of liability.


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