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FCPA Blog Daily News

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Friday
Mar212014

After RICO trial win, Chevron demands $32 million from plaintiffs lawyer Donziger for attorneys fees

Chevron Corporation asked a federal court Tuesday to award it $32 million for attorneys fees it incurred during a successful fraud and racketeering trial against U.S. lawyer Steven Donziger.

As first reported Thursday by Oil Patch Asia (and reprinted here with permission), Chevron said in a motion for attorney’s fees that Donziger used “a pattern of racketeering that included multiple frauds, extortion, [and] obstruction of justice” to win a multi-billion-dollar pollution judgment against Chevron in Ecuador.

In early March, U.S. District Court Judge Lewis Kaplan said in a 485-page opinion that he found “clear and convincing evidence” that Donziger’s two-decade legal effort to punish Chevron for polluting the Ecuadorian rain forest was tainted by fraud and corruption.

The judge said evidence during the seven-week RICO trial showed that Donziger and his legal team bribed an Ecuadorean judge to issue an $18 billion judgment against Chevron in 2011.

Donziger has denied the allegations and is appealing Judge Kaplan's ruling.

Ecuador’s high court cut the judgment down to $9.5 billion in 2013.

Chevron accused Donziger of fraud and racketeering in the U.S. lawsuit, which was fought for over two years and involved at least a million documents.

Chevron’s main witness in the U.S. trial against Donziger was a former Ecuadorian judge who testified that he was paid $1,000 a month to ghost-write favorable opinions for the presiding judge, Nicolas Zambrano.

The witness also testified that Judge Zambrano told him Donziger would pay Zambrano $500,000 of the eventual damages as long as he agreed to a favorable verdict.

In its motion Tuesday for legal fees, Chevron said it is entitled to reimbursement from Donziger under the federal RICO statute that it used to sue the American lawyer.

The oil company said “Donziger’s tactics in the litigation compounded Chevron’s legal costs.”

The “Donziger defendants and their Ecuadorian allies have been remarkably obstructive in this case,” Chevron said, quoting from Judge Kaplan’s opinion.

Donziger “chose to attack Chevron rather than to defend his indefensible conduct,” Chevon said, causing the oil company to incur thousands of extra hours of attorney time.

“Chevron seeks an award of $32,334,584 for attorneys’ fees . . . reflecting 36,837 hours billed by Chevron’s outside counsel at Gibson, Dunn & Crutcher LLP,” Chevron’s motion said.

The motion also asked for reimbursement for 139,749 hours billed to Chevron by lawyers at Huron Consulting Group and Merrill Communications LLC.

“This amount [$32 million] is based on reasonable hourly rates — commensurate with the rates charged by comparable firms in the Southern District of New York, and appropriate for the complexity and importance of this litigation,” Chevron said in its motion.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.