Canadian judge skeptical about hearing $19-billion Ecuador lawsuit case

TORONTO – An attempt by Ecuadorian villagers to have a Canadian court enforce a $19-billion judgment awarded in their country against multinational oil giant Chevron Corp. got off to a rocky start Thursday, with an Ontario judge openly skeptical about the proposition.

Ontario Superior Court Justice David Brown made no bones about his feelings as a lawyer for Chevron attempted to argue the villagers had no cause against subsidiary, Chevron Canada.

For one thing, Brown noted, an Ontario court should not even think about weighing in unless there had been a final judgment in the South American country and no one had persuaded him there was one.

“This is basic stuff, folks,” he said. “Why should an Ontario court stick its nose into a lawsuit where there is no final judgment?”

Chevron Corp. lawyer Alan Mark, who had a rough time getting to his substantive submissions, conceded there was an appeal pending in Ecuador’s constitutional court.

That prompted Brown to retort, “I need to have evidence. I need to have argument. You can’t keep me in the dark on this.”

The award to the villagers was made in Ecuador for black sludge contamination of a rainforest between 1972 and 1990 by Texaco, which Chevron Corp. bought in 2001. Chevron Corp. maintains it won’t pay because it contends Texaco dealt with the problem before it was bought.

The villagers are pushing in the two-day hearing to have the judgment enforced in Canada. They argue Chevron Canada has billions of dollars worth of assets.

After filing suit in Canada this past May, the Ecuadorians launched similar legal actions in Argentina and Brazil. Earlier this month a judge in Argentina froze Chevron’s assets there until the $19 billion is collected.

Foreign judgments are enforceable in Canada as long as there is a “real and substantive connection” between the foreign jurisdiction and the subject matter of the claim, the Supreme Court of Canada has ruled.

However, Mark argued there is no link between Chevron Canada and the villagers, and so Ontario has no jurisdiction.

“There is no other connection to Ontario but for the claim that the assets of Chevron Canada Ltd. are the assets of Chevron Corp,” Mark said.

“Without that connection factor, the enforceability of this judgment would be an entirely moot and an academic exercise in Ontario.”

Brown kept coming back to whether he should be hearing the arguments at all.

“You should all be down in New York. This is a New York fight, not an Ontario fight.”

In other submissions, another Chevron lawyer, Clarke Hunter, accused the plaintiffs of overreaching in their effort to “pierce the corporate veil” and go after Chevron Canada.

The judgment was against the parent company, whose subsidiaries operate largely independently, he said.

“Chevron has adopted a decentralized method of management,” Hunter said.

Nor was there any evidence that Chevron Canada had anything to do with what happened in Ecuador, he said.

Counsel for the Ecuadorians get to present their case in court on Friday.

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