Ecuador plaintiffs to file lawsuit against Chevron in Argentina

QUITO Wed Oct 31, 2012 1:16pm EDT

QUITO (Reuters) - Ecuadorean plaintiffs plan to file a lawsuit against Chevron in Argentina, their third legal attempt outside the Andean country to enforce a $19 billion ruling against the U.S. oil company for pollution in the Amazon, a source with direct knowledge of the case said.

The 2011 judgment against Chevron is one of the biggest rulings for environmental damage and is being tracked closely by the global oil industry.

The source told Reuters that the plaintiffs' legal team would file a lawsuit against Chevron in an Argentine court.

Other sources said the legal team is due to hold a news conference in Buenos Aires on Wednesday afternoon to announce the suit.

Since Chevron has barely any assets in Ecuador, the claimants are trying to get the ruling enforced outside the OPEC-member country. The plaintiffs' lawyers filed a similar lawsuit in Brazil in June and another one in Canada in May.

Chevron says the original ruling is unenforceable and illegitimate and that it is the product of "bribery and fraud."

"If the plaintiffs' lawyers believed they had a legitimate judgment they would seek to enforce it in the United States. It's precisely because of the plaintiffs' lawyers' fraud that they are now in Argentina instead of the United States," Chevron spokesman Kent Robertson told Reuters.

In early October, Chevron, the No. 2 U.S. oil company, lost a bid to have the U.S. Supreme Court block enforcement of the ruling. [ID:nL1E8LGMYO] The plaintiffs won an order from an Ecuadorean court two weeks ago that they said lets them seize some $200 million worth of assets in Ecuador belonging to Chevron. [ID:nnL1E8LGMYO]

The plaintiffs from villages in the oil-rich Amazon won an $18.2 billion case against the oil giant over claims that Texaco, bought by Chevron in 2001, contaminated the area from 1964 to 1992.

The ruling was issued by a court in the town of Lago Agrio, in the Ecuadorean Amazon, and ratified by an appeals court in January 2012. Damages were increased to $19 billion in July.

The plaintiffs accused Texaco of causing illnesses among the local population by dumping drilling waste in unlined pits.

Chevron denies the accusations and says Texaco properly cleaned up all the pits for which it was responsible.

Filled with intrigue, accusations of corruption, bribery and dirty tricks, the complicated case has been fought for nearly two decades, mainly in courts in Ecuador and the United States.

Anticipating such a global legal battle, Chevron filed for arbitration in September 2009.

The arbitration panel has to rule whether Ecuador violated a treaty with the United States requiring it to guarantee Chevron a fair trial.

The company has also accused the plaintiffs, their legal team and their advisers of fraud in a U.S. court and the trial is scheduled to begin on October 15, 2013.

The plaintiffs' legal team argues that Texaco's remediation efforts were insufficient. Their long-term legal adviser Steven Donziger has also filed counter claims in a U.S. court accusing Chevron of fraud. (Editing by Mohammad Zargham)

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