Thursday, January 5, 2012

Gibson Dunn: Fewer Options But Bigger Bills for Chevron in Ecuador Case

Paul Paz y Mino of Amazon Watch writes an excellent blog on Huffington Post, called How Lawyer Arrogance Imperils Chevron Shareholders in Ecuador.

He details the “monumental mistakes” made in the Ecuador contamination case by Gibson Dunn, the Chevron law firm that pushed out the company’s other law firm Jones Day from being the lead on the lawsuit about two years ago. Paz y Mino argues the firm’s mistakes – specifically those of lead partner Randy Mastro – have “increasingly imperiled” Chevron shareholders.

This week the Ecuador appellate court upheld the trial court’s $18 billion judgment. If Chevron does not post a bond in its final appeal, the Ecuadorians can begin to enforce by asking courts in other countries to seize Chevron’s assets. (Chevron has none in Ecuador and has refused to pay the judgment.)

Gibson Dunn is quickly running out of legal options, but it is a master at invoicing for the 60 or so lawyers working on the case. In all, Chevron is paying for close to 500 lawyers and legal assistants fighting five indigenous groups in some of the poorest regions of the world.

We ask the same question one of the U.S. 2nd Circuit Court of Appeals judges asked before throwing out Gibson Dunn’s efforts to block enforcement: Do Chevron’s shareholders understand how much money is being spent on this lawsuit?