Ecuador Plaintiffs Sue Chevron in Brazil

Lawyers representing residents of Ecuador's Amazon rain forest said Wednesday they filed a lawsuit to seize Brazilian assets belonging to Chevron Corp., a new step in an international campaign to collect multibillion dollar award they won in a pollution case last year.

The claim, filed Wednesday in the Superior Tribunal of Justice in Brasilia, Brazil, is part a long-running legal battle. The plaintiffs have argued their land was contaminated by oil operations in the Ecuadorian Amazon dating back to the 1970s involving Texaco Inc., which Chevron bought in 2001. Last year, a court in Ecuador found Chevron liable and levied an $18.2 billion judgment.

Chevron doesn't have any assets in Ecuador. But the plaintiffs have said they will try to seize Chevron's assets in countries where it operates to force it to pay the judgment. The Brazilian lawsuit is the second filed by the plaintiffs, who last May filed an action in Canada to seize assets belonging to Chevron in that country.

"We believe that the judgment is enforceable and we believe both Canada and Brazil will enforce our judgment," said Karen Hinton, a spokeswoman for the plaintiffs.

Chevron, which is fighting the Ecuadorian decision both in Ecuador and in international courts, on Wednesday repeated its criticism of the court judgment and predicted the latest legal maneuver by plaintiffs' attorneys wouldn't succeed. "The Ecuador judgment is a product of bribery, fraud and it is illegitimate," Chevron said in a statement. "The company does not believe that the Ecuador judgment is enforceable in any court that observes the rule of law."

The plaintiffs "categorically deny" Chevron's accusations of fraud, Ms. Hinton said. The legal action in Brazil was "made necessary by Chevron's refusal to comply with an $18 billion court judgment in Ecuador that was affirmed on appeal," the plaintiffs said in a statement. The group said they were targeting Chevron operations in Brazil they said produce 33,000 barrels of crude oil and 13 million cubic feet of natural gas a day. Chevron already faces legal challenges in Brazil, where a small spill in its offshore operations caused an uproar and has brought criminal charges which the company is fighting.

Chevron is the second-largest U.S. oil company after Exxon Mobil Corp.

Copyright (c) 2013 Dow Jones & Company, Inc.

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