Judge rules in Chevron's favor in case against Ecuador, MCSquared

US District Court Judge Lewis Kaplan has allowed Chevron to conduct discovery, or obtain information and facts from MCSquared.

SAN RAMON, CA: Chevron was granted a petition by a US District Court Judge to seek discovery from MCSquared regarding its work with Ecuador on a campaign against the energy company.

US District Court Judge Lewis Kaplan has allowed Chevron to conduct discovery, or obtain information and facts from Brooklyn, New York-based agency MCSquared, about a lawsuit from 2011 that was ruled unenforceable this March by the US District Court for the Southern District of New York.

In February 2011, Chevron was sued for $18 billion – an amount later reduced to $9.5 billion – by a court in Lago Agrio, Ecuador, for allegedly causing social and environmental harm in the Amazon areas of the country. However, the judgment was ruled this March to be a product of "fraud and racketeering activity," according to court documents.

At the time, Kaplan ruled that New York lawyer Steven Donziger and his litigation team fabricated evidence, promised $500,000 to an Ecuadorean judge to rule in their favor, and ghostwrote much of the case's final verdict during a six-week trial last November.

This summer, it was reported that Ecuador had worked with MCSquared and FitzGibbon Media on a $6.4 million contract that ended in April with the goal of improving the country’s reputation. According to Bloomberg Businessweek, filings under the Foreign Agents Registration Act by the agencies "reveal extensive support the government of Ecuador is providing the plaintiffs’ side in a long-running legal campaign to hold Chevron liable for pollution in the Amazon."

MCSquared told PRWeek in May that it was not responsible for a number of protests against Chevron this year or environmental activist group Toxic Effect’s #AskChevron Twitter campaign.

"The Republic of Ecuador entered into an unprecedented $6.4 million contract with MCSquared to design and implement a media campaign against Chevron and to promote enforcement of a fraudulent Ecuadorian judgment against the company," said Chevron, in a statement. "MCSquared likely possesses evidence relating to the coordination between the Republic of Ecuador and the plaintiffs behind the fraudulent lawsuit."

Representatives from MCSquared did not respond to inquiries seeking comment.

The conflict between Ecuador and Chevron dates back to the 1960s, when Texaco began drilling for oil in the country. After it ended operations there 30 years later, residents sued the energy company over oil pollution, resulting in a $19 billion judgment that was later affirmed by an Ecuadorean court but scaled back to $9.5 billion. Chevron, which inherited the lawsuit after acquiring Texaco in 2001, had denied liability for environmental damage.

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