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Supreme Court won't consider blocking $18B judgment against Chevron

By the CNN Wire Staff
October 24, 2012 -- Updated 1443 GMT (2243 HKT)
A Chevron gas station in San Rafael, California, is pictured on July 27.
A Chevron gas station in San Rafael, California, is pictured on July 27.
STORY HIGHLIGHTS
  • Chevron appealed to the Supreme Court to block an $18 billion judgment against it
  • The court will not consider the case
  • An Ecuadorian court levied the fine on Chevron in an oil pollution case
  • Chevron is appealing to Ecuador's National Court

(CNN) -- The U.S. Supreme Court has denied an appeal by Chevron to block an $18 billion judgment against it in an Ecuadorian court.

The high court gave no explanation behind its decision not to consider the appeal from the oil giant.

The case, Chevron Corp v. Naranjo et al, stems from a 2011 injunction against enforcement of any judgments against the company related to lawsuits in Ecuador. A judge initially granted the injunction, but in January of this year an appeals court reversed the lower court's finding, removing the injunction.

What the Supreme Court announced on Tuesday was that it would not consider Chevron's appeal to reinstate the injunction.

An Ecuadorian court had ruled that Chevron must pay $8.6 billion in damages relating to a pollution lawsuit, an amount that increased to $18 billion because Chevron did not apologize.

In Ecuador, Chevron has appealed to the country's National Court, and in the United States it sought to reinstate the injunction against enforcement of the Ecuadorian ruling.

Chevron noted the Supreme Court ruling was not based on the merits of the case, and does not undo findings by another court that "fraud and bias have tainted the Ecuadorian proceedings and judgment."

"While Chevron is disappointed that the court denied the petition, Chevron will continue to defend against the plaintiffs' lawyers' attempts to enforce the fraudulent Ecuadorian judgment," the company said on a blog it devotes to the case.

Chevron's legal fight in Ecuador involves litigation that goes back 19 years between residents of Ecuador's Amazon region and Texaco, which was later purchased by Chevron.

The pollution case stems from claims that the company had a detrimental impact on Amazonian communities where it operated.

The company alleges that reports and evidence against it were fraudulent, and that bribes and corruption led to the original decision against it.

That case, Aguinda v. ChevronTexaco, was originally filed in New York in 1993 on behalf of 30,000 inhabitants of Ecuador's Amazon region. The suit was eventually transferred to the Ecuadorian court and Ecuadorian jurisdiction.

The lawsuit alleges that Texaco used a variety of substandard production practices in Ecuador that resulted in pollution that decimated several indigenous groups in the area, according to a fact sheet provided by the Amazon Defense Coalition.

According to the group, Texaco dumped more than 18 billion gallons of toxic waste into Amazon waterways, abandoned more than 900 waste pits, burned millions of cubic meters of gases with no controls and spilled more than 17 million gallons of oil due to pipeline ruptures.

Cancer and other health problems were reported at higher rates in the area, the group says.

Chevron says Texaco was partnered with an Ecuadorian oil company when it operated in Ecuador, and that it spent $40 million on remediation efforts to clean up roughly one-third of the sites in which it worked -- an amount reflective of its 37% share of the oil-producing consortium with Petroecuador.

It says its cleanup efforts were certified and approved by the Ecuadorian government and blames Petroecuador for any ongoing pollution at sites where it was the sole operator, according to documents on the Chevron website regarding the lawsuit and its history of operations in the South American country.

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