By way of update on a case we have previously written about (in
January 2014, and
December 2014), on March 12, 2015, the International Court of
Justice (the "ICJ") upheld the controversial USD $9.5
billion Ecuadorian judgment against Chevron Corporation for harm
caused to 30,000 Ecuadorian residents by environmental pollution
from 1972 to 1990 (the "Ecuadorian Judgment").
The recent ICJ ruling is the result of Chevron's appeal of
the Ecuadorian Judgment. Chevron argued Ecuador violated a
bilateral investment treaty signed with the United States and a
1995 settlement agreement reached with the Ecuadorean government
prevented the Ecuadorian plaintiffs from advancing their class
action lawsuit. However, the ICJ stated that because the case
involved the individual rights of the Ecuadorian plaintiffs, the
1995 settlement agreement – executed between the then
government of Ecuador and oil company Texaco, which Chevron
acquired in 2001 – did not bind the plaintiffs.
The Supreme Court of Canada recently heard arguments on an
appeal related to the enforcement of the Ecuadorian Judgment in
Canada. The decision, which has not been released, is expected to
provide guidance on foreign plaintiffs' ability to enforce
foreign judgments against the assets of Canadian subsidiaries.
While the ICJ ruling may not directly affect the decision of the
Supreme Court of Canada, it serves to buttress the Ecuadorian
Judgment underlying the enforcement proceedings in Ontario
(although the same judgment was found by a New York court to have
been fraudulently obtained).
We will provide a further update when the Supreme Court of
Canada releases its decision.
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