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Trials & Litigation

Chevron Shifts Gears, Files Civil RICO Suit Against Plaintiffs

Posted Feb 3, 2011 12:13 PM CDT
By Martha Neil

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Corrected: Upping the ante in a hard-fought legal battle over megabillions in environmental damage allegedly caused to a South American rain forest by a predecessor of Chevron Corp., the oil company has filed a civil racketeering lawsuit against the plaintiffs.

The suit accuses the plaintiffs, their lawyers and other members of their legal team of conspiring to manufacture evidence, intimidate Ecuadorian court officials and withhold evidence from U.S. courts, the Wall Street Journal Law Blog reports.

Attorney Steven Donziger, who served as lead plaintiffs attorney in Ecuador, is a named defendant along with 47 others and is accused of participating, reports the Law Blog and Philadelphia Inquirer in a story that has subsequently been corrected.

Donziger’s attorney, Gerald Lefcourt, calls the suit “a cynical bid to buy cover,” the Law Blog reports.

According to Chevron's complaint, Joseph Kohn and his law firm, Kohn Swift & Graf, financed a plaintiffs team in Ecuador that falsified expert reports and colluded with the country's government to achieve a favorable outcome. Kohn and his firm are called co-conspirators in Tuesday's complaint, but they are not named as defendants in the lawsuit.

The Racketeer Influenced and Corrupt Organizations Act case says Donziger, Kohn and others conspired to use improper tactics to pressure Chevron into what could have been a huge settlement, given the magnitude of the case.

However, a lawyer for Kohn's firm says the allegations are "totally unfounded and false" as far as KSG is concerned, and a spokeswoman for the plaintiffs says it is Chevron that is excessively pressuring its opponents, the newspaper reports. Kohn has said in the past, through his counsel, that he was unaware of any wrongdoing in Ecuador and withdrew from the suit against Chevron once he learned of potential problems.

"This outrageous action today is corporate bullying at its worst," spokeswoman Karen Hinton, who also is named in the suit, said yesterday. "Chevron is cornered by the overwhelming evidence of guilt in the intentional contamination of one of the most pristine rain forests in the world."

Chevron was not initially responsible for the alleged damage, which occurred at a Texaco facility, but the company bought into the lawsuit when it merged with Texaco in 2001.

Corrected Thursday to note that Kohn and his firm are identified in the complaint as non-defendant co-conspirators; and updated to add additional information from the WSJ Law Blog.

Earlier coverage:

ABAJournal.com: "Doc Film Helped Chevron Subpoena Plaintiffs’ US Legal Files in $113B Ecuador Enviro Case"

ABAJournal.com: "Lawyer in Megabucks Chevron Enviro Case Must Turn Over Hard Drive Mirror Images, Judge Rules"

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