Chevron Looks Beyond Lawyer for Corrupt Suit

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March 25, 2014

After a judge ruled that a $9.5 billion verdict against Chevron in Ecuador was secured through “corrupt means,” the company is going after the lead lawyer in the case, a law firm that tried to enforce the judgment, and, now, a funder that backed the litigation.

Under litigation funding arrangements, investment firms provide capital to lawyers to conduct litigation. The funders say the practice only supports well-founded cases, but, as we’ve seen in Ecuador, it helped keep alive a case that, rather than being about justice, was a means to pressure Chevron into a payout. In fact, the funder that Chevron is pursuing helped produce a documentary that was supposed to bolster their case but actually captured some of the corrupt practices by the plaintiffs.

One funder dropped out, claiming the plaintiffs’ lawyers made “false and misleading representations” about the case.

“Chevron's case against [the funder] is now gaining traction,” writes Michael D. Goldhaber, who has been following the case closely for the American Lawyer. “Any funder or lawyer involved in the business of enforcing foreign judgments would be wise to pay attention.”