Bob McCarty Writes

Loyal readers of this blog will remember the name of Richard Cabrera as one that has appeared in a half-dozen posts on this blog, including one in which I asked the question, What Will Be The Outcome of the Amazon Defense Coalition’s Lawsuit Against Chevron in Ecuador? Thanks to news that broke today out of Ecuador, it appears the world might be one step closer to learning what that outcome might be.

In a court filing in Lago Agrio, Ecuador, Chevron provided newly-discovered information (a.k.a., “dirt”) showing that Cabrera is the majority owner of an oilfield remediation company that stands to gain financially from a potential $27 billion judgment against Chevron.  Due to the remediation company’s relationship with Ecuador’s state-owned oil company, Petroecuador, Chevron called upon the court to immediately reject the work of Cabrera on the grounds that he knowingly hid his relationship and stands to gain from what was supposed to be unbiased work for the court.

“For three years, Mr. Cabrera has concealed clear financial conflicts of interest that disqualify him from acting as an independent and objective evaluator of the evidence in the case,” said Chevron Vice President and General Counsel Hewitt Pate in a company news release. “While Mr. Cabrera’s financial interests alone are sufficient grounds for his report to be rejected, his intentional concealment of those interests further demonstrates that the entirety of his work lacks honesty, integrity, or credibility.”

To read Chevron’s “dirt” on Cabrera, click here or on the graphic above.

Recently uncovered records — dated 2003 through 2008 — show Cabrera is co-founder, general manager, majority stockholder and legal representative of an oilfield remediation company, Compañía Ambiental Minera-Petrolera S.A. (“CAMPET”), which is registered to perform oilfield remediation and other services for Petroecuador. Cabrera failed to disclose these business interests as required by law.

After knowingly omitting to disclose his financial interest in CAMPET, as well as CAMPET’s status as a registered Petroecuador contractor, Cabrera affirmatively misrepresented in court filings that he did not have any impediment or conflict that would affect his performance as an “independent” court-appointed witness. Cabrera violated the law by accepting his appointment, which required an explicit acknowledgment of public duties as an impartial analyst—an acknowledgment Cabrera could not truthfully have made given his financial interests.

The work Cabrera did as an “independent expert” was dubbed the Cabrera Report (pdf) and was very one-sided — against Chevron — in its recommendations.

In his report, Cabrera absolves Petroecuador of any responsibility or remediation obligations associated with past or present oil operations despite its majority ownership of the Petroecuador-Texaco Petroleum consortium, which operated until mid-1992, and Petroecuador’s sole ownership and operation of the former consortium fields for the past 18 years. Disregarding Ecuadorian media reports and other evidence showing that Petroecuador has spilled millions of gallons of oil since taking over exclusive ownership and operations in 1992, Cabrera exclusively attributes pollution in the Amazon region of Ecuador to Texaco Petroleum, now a fifth-tier subsidiary of Chevron.

Cabrera’s report also says that Chevron, because it acquired Texaco Inc. in 2001, is solely liable for damages, citing grossly inflated remediation costs while ignoring Petroecuador’s role in oil operations and its well-documented poor environmental performance. Cabrera’s report also calls on Chevron to pay $375 million to update Petroecuador’s oilfield equipment, which Petroecuador has for decades failed to properly maintain or replace. These findings make no sense as a matter of Ecuadorian law or common sense, but are consistent with furthering Petroecuador’s interests, as well as Cabrera’s own.

Chevron previously challenged Cabrera’s lack of qualifications as well as the biased and baseless substance of his report. But Judge Juan Nuñez, who subsequently was disqualified for his involvement in a scheme to solicit bribes in connection with letting remediation contracts that were supposed to be funded with the proceeds of the judgment Cabrera recommended, inexplicably ignored those challenges, thus shielding Cabrera’s work from scrutiny. Now that Cabrera’s clear conflicts of interest are revealed, Chevron has demanded that the court strike his entire involvement in the case.

“Mr. Cabrera has placed his own financial interests, as well as the interests of Petroecuador and the Amazon Defense Coalition, ahead of the interest of justice,” Chevron’s Pate added. “Today’s disclosure further illustrates the illegitimacy of Mr. Cabrera’s fictitious $27 billion recommendation. Taken into account with Mr. Cabrera’s collusion with the plaintiffs’ lawyers and representatives, it is clear that his report should have no bearing in the outcome of this trial.”

EDITOR’S NOTE: To read six BMW posts about Richard Cabrera, click here.  To read some 30 lawsuit-related posts, click here.