Will Chevron Case Take Down Trade Pact `Investor-State´ Enforcement System?

Unprecedented Ruling Today by International Investor Tribunal Orders Ecuadorian Government to Violate Its Constitution, Interfere in Its Independent Court System to Help Chevron Evade Liability for Amazonian Contamination

Eyes on Trade- Public Citizen's Blog on Trade and Globalization February 17, 2012
Public Citizen statement on ruling in favor of Chevron

Speaking of the Chevron case, there was just a major development.
Here's the ruling, and here's our statement:

Will Chevron Case Take Down Trade Pact `Investor-State´ Enforcement
System?

WASHINGTON, D.C. - An unprecedented ruling, in which an investor-
state international arbitral tribunal initiated by Chevron ordered
the Ecuadorian government to interfere in the operations of Ecuador´s
independent court system on behalf of the oil giant, provides a chilling
glimpse of how corporations are trying to use international investor
tribunals to evade justice, said Public Citizen.

After having lost on the merits in Ecuador and U.S. courts and after 18
years of trying to stall judgment, Chevron turned to an ad hoc
"investor-state" tribunal of three private lawyers as the last chance to
help the company avoid paying to clean up contamination in the Amazonian
rainforest. Chevron is trying to get this private tribunal to suspend
enforcement of or alter an $18 billion judgment against Chevron rendered
by a sovereign country´s court system.

The tribunal issued a ruling yesterday even though it has not even
determined that it has jurisdiction over the case. Past such
international investor cases in which tribunals have ordered
governments to pay cash damages to corporations have led to growing
controversy.

"The Ecuadorian government should not violate its own constitution
and interfere with its independent courts´ order for Chevron to clean up
its horrific contamination in the Amazon, because some unelected ad hoc
tribunal of three private sector lawyers called together by Chevron to
meet in a rented room in Washington, D.C., pretends to have the authority
to second-guess 18 years of U.S. and Ecuadorian court rulings," said Lori
Wallach, director of Public Citizen´s Global Trade Watch.

"Consider the broader implications of this star chamber `investor-
state´ system: How can a panel of three unelected private sector
lawyers order a sovereign government to violate its own
constitution´s separation of powers and interfere in its court
system, all to help Chevron (a company whose severe contamination of the
Ecuadorian Amazon has been repeatedly proven), and how can that tribunal
do this all before it has even decided that it has jurisdiction over this
case," Wallach said.

Meanwhile, the three private-sector lawyers serving as tribunalists
on this kangaroo court will continue to rack up large hourly fees
even as they order Ecuador´s government to help Chevron deny justice to
the 30,000 Amazonian indigenous people who have won a historic $18 billion
clean-up of deadly environmental contamination. Tribunalists in this
system, who alternate between serving as "judges" and representing
corporations in cases before panels of their colleagues, are paid on an
hourly basis.

"The only silver lining of this obscene ruling is that having one of these
shady investor-state tribunals presume to attack a country´s constitution,
justice system and 30,000 people whose futures rely on Chevron cleaning up
its mess could lead to the implosion of the entire investor-state system,
which international companies are increasingly using to try to evade
justice worldwide," said Wallach.

These unaccountable investor-state tribunals have issued perverse
rulings in the past on behalf of corporate claimants. Recent U.S.
trade agreements empower foreign corporations to use this system to
skirt our domestic courts and directly use our government before
these corporate tribunals to obtain payment of unlimited taxpayer
funds when they claim domestic environmental, land use, health and
other laws undermine their "expected future profits."  More than $350
million has been paid by government to corporations in attacks on toxics
bans, environmental issues and zoning permits under the North American
Free Trade Agreement (NAFTA.) Billions in additional claims are pending.
Possible inclusion of the investor-state private enforcement system for
corporations to sue governments is becoming one of the most controversial
issues in the first "trade" deal the Obama administration is negotiating -
a new Trans-Pacific Partnership trade deal.