Rainforest Indians get new chance in Texaco suit
Date: 01-Feb-00
Country: USA
U.S. District Judge Jed Rakoff said that while he had tentatively been
leaning toward dismissing the suits so they could proceed in a foreign
court, he said he would consider arguments about whether an Ecuadorean
court could be impartial after Friday's military coup in which President
Jamil Mahuad was deposed.
Rakoff said Mahuad had appeared to be taking significant steps toward
improving the independence of the judiciary. He said that while Mahuad
was eventually replaced by the elected vice-president, Gustavo Noboa,
the events of the coup were reported as evidence of a resurgent military
involvement in civilian affairs.
He also said that one of the leaders of the coup was a former justice of
the Supreme Court of Ecuador.
The litigation stems from two suits filed in 1993 and 1994 by residents
of the Oriente region of Ecuador and residents of Peru who live
downstream from Ecuador's Oriente region. The plaintiffs alleged that a
Texaco subsidiary dumped an estimated 30 billion gallons of toxic waste
into their environment while extracting oil from the Ecuadorean Amazon
between 1964 and 1992.
The plaintiffs alleged that instead of pumping the substances back into
emptied wells, Texaco dumped them in local rivers, directly into
landfills or spread them on the local dirt roads.
They also allege that the Ecuadorean Pipeline, constructed by Texaco,
leaked large amounts of petroleum into the environment. The Indians
alleged that they and their families suffered various injuries,
including poisoning and development of precancerous growths.
The plaintiffs have estimated that clean-up costs, compensation for
devastation to the rainforest and alleged increased cancer risks for
thousands of people could exceed $1 billion.
The district court had dismissed the suits in 1996 and 1997 on grounds
that New York was not the proper place for the litigation and that
Ecuador would be a more convenient location.
However, in 1998, the U.S. Second Circuit Court of Appeals reversed the
ruling and sent it back to the trial court for reconsideration. Texaco
is headquartered in White Plains, N.Y., which is within the Second
Circuit's venue.
In reconsidering the cases, Rakoff said that the "voluminous record
before the court demonstrates that these cases...have everything to do
with Ecuador and very little to do with the United States."
"Moreover, the notion that a New York jury applying Ecuadorean law
(which likely governs the claims here made) could meaningfully assess
what occurred in the Amazonian rainforests...is problematic on its
face."
However, he said that the recent military coup and other circumstances
have led him to reopen the court record so that the parties can argue
whether the courts in Ecuador or in Peru might be expected to exercise a
"modicum of independence and impartiality" if the cases were dismissed
in the United States so that they could proceed in a foreign location.
