Keker & Van Nest tries (again!) to intervene in Chevron trial

By Alison Frankel
August 12, 2011

We’re less than three months away from Manhattan federal judge Lewis Kaplan’s trial to determine whether an Ecuadorean court’s $18 billion judgment against Chevron for contaminating the Lago Agrio region of the rainforest is enforceable in the U.S. In the declaratory judgment proceeding, Chevron’s lawyers at Gibson, Dunn & Crutcher will argue, as they have for the last 18 months, that the Ecuadorean judgment was the result of political and public relations chicanery, much of it committed by the plaintiffs lawyer who spearheaded the Ecuadoreans’ case, Steven Donziger. But according to Donziger’s lawyers at Keker & Van Nest, Judge Kaplan won’t give them or their client a chance to be heard as the declaratory judgment case races to trial.

On Thursday, Keker filed its third motion asking Judge Kaplan to reconsider a May 31 ruling limiting Donziger’s participation in the case. “The exclusion of Donziger from full intervention in this ‘do-over’ trial has reached the point of absurdity,” Keker partner Elliot Peters wrote in the 11-page Donziger filing. “The trial will be about him, and he won’t be there to defend himself against Chevron calumny.”

“This is ironic, in the bitter sense,” Peters told me in an interview Friday. “The U.S. court is denying due process to a litigant in a case in which the U.S. gets to decide whether the court of a different sovereign nation denied due process.”

The controversy over Donziger’s participation arose in May, after Judge Kaplan split Chevron’s 2010 suit against Donziger and several other witnesses into two pieces — a declaratory judgment action to determine the enforceability of the Ecuadorean judgment and racketeering claims against Donziger and the other defendants for their allegedly fraudulent prosecution of the Ecuadorean case. Gibson Dunn then re-filed the declaratory judgment piece of the original case against Donziger as a separate suit, without naming Donziger as a defendant. Judge Kaplan subsequently concluded that Donziger couldn’t intervene in the declaratory judgment action because he wasn’t a party, didn’t have a financial interest in the outcome, and couldn’t repair any damage to his reputation in the separate racketeering case.

The judge granted Donziger’s lawyers the right to cross-examine deposition witnesses testifying directly about his conduct, but said that was all Keker & Van Nest could do. Though Kaplan said he might revisit the ruling, he denied two July reconsideration motions by Keker & Van Nest. The transcript of an August 2 phone conference shows that those two motions hadn’t swayed the judge at all. At the end of the conference, John Keker said, “Your honor, can I say something?” Kaplan replied: “No, Mr. Keker. You’re not in the case for this purpose.You’re being given the courtesy of being conferenced in but the scope of your intervention has been fixed.”

Nevertheless, Keker & Van Nest filed Thursday’s motion in yet another attempt to change Judge Kaplan’s mind. Keker partner Peters argued that Chevron’s latest witness lists and subpoenas, filed after the August 2 conference, made it clear that the oil company is trying to relitigate the Ecuadorean case, which necessarily means a re-examination of Donziger’s conduct in the declaratory judgment trial. “If what actually happened in Ecuador matters at all to the court’s decision, the court should let Donziger intervene, grant the Lago Agrio plaintiffs’ motion to continue, and let the parties conduct a real, not show, trial,” the Keker & Van Nest brief said.

“The judge’s [May 31] ruling gave us no rights, but prevents us from appealing,” said Peters, explaining why Keker & Van Nest keeps coming back to Kaplan. “What’s the harm of allowing Donziger in the litigation? Why are we engaged in this charade that he can’t participate in a trial about his conduct?”

The Lago Agrio plaintiffs, who are now represented by Smyser, Kaplan & Veselka in the declaratory judgment proceeding, support Donziger’s intervention. “Judge Kaplan encouraged Chevron to file the lawsuit against Steven Donziger and when Donziger demanded an immediate jury trial Judge Kaplan all but directed Chevron to drop him as a defendant,” said plaintiffs spokewoman Karen Hinton in an e-mail statement. “Now he won’t let Donziger anywhere near his courtroom. This is turning into a home-cooked judicial bailout for Chevron.”

Chevron counsel Randy Mastro of Gibson Dunn doesn’t seem too worried that Judge Kaplan will let Keker & Van Nest into the case. In addition to Judge Kaplan’s two rejections of Keker motions to reconsider his May ruling, the U.S. Court of Appeals for the Second Circuit has already turned down two Donziger bids to review Kaplan’s order. “Donziger’s lawyers have taken so many bites of the apple that they’ve bitten through the core,” Mastro quipped. He said there’s no reason for Donziger to participate in the declaratory judgment trial, any more than Gibson Dunn should be a party to the case. “It’s ludicrous to suggest that Donziger has independent status to appear as a party in a proceeding to determine the enforceability of the judgement,” Mastro said. “We’re merely the lawyers.”

I’d say the odds of Judge Kaplan reversing course are slim, but the judge did offer a rare (though tiny) win to the Ecuadorian plaintiffs Thursday. In a one-paragraph order, Kaplan quashed Chevron’s most recent subpoena to the “Donziger entity” as “overly broad and perhaps ambiguous.”

 

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