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Chevron Case Highlights Difficulty of Making Oil Companies Pay for Spills

The biggest oil spill cases show that lengthy and expensive litigation works in favor of oil companies

By Michael Keller and Stacy Feldman

Mar 20, 2011
Oil contamination in the Ecuadorean Amazon rainforest.

"The companies don't often fight on when it is that they are required to do something, but on whether the proposed remedy is really necessary," he said. "The bigger the stakes are in terms of cost, the more likely the defendants will examine what's required and what's necessary.”

Kretzmann says oil giants are never liable for full public health and environmental costs, and he doesn't see that changing.

"They do their absolute best to get around reasonable regulations and then there's a ton of externalities that they don't even get charged with," he said. "There’s a huge cost to health and the environment that rarely gets linked to industry and written off as, 'Gosh, that's too bad.'

"Their lawyers look for holes in regulations, legal strategies they can use to get around them, or ways they can defund the regulations. Then they'll send the PR out that says they agree with us ... I've been around this industry as an environmentalist for two decades now. They always say they’ll make it better and they never do."

Chevron, Global Test Case, to Continue

In the long-running Ecuador case, Chevron both the court system in that country and the U.S. legal team representing the villagers of corruption and fraud. 

Immediately following the February judgment, the largest-ever environmental reward after BP's $20 billion compensation fund, which was set up after the Deepwater Horizon spill, Chevron declared it "illegitimate," saying it was "unenforceable in any court that observes the rule of law."

The dispute stems from Texaco oil operations that started in the 1970s, which locals say have caused widespread illness and death. They claim there are still hundreds of unlined waste pits dotting the countryside leaking toxic compounds into the county's water supplies, and have sought up to $27 billion in damages. Chevron bought Texaco in 2001 and assumed its liabilities.

"The petroleum companies were bulldozing indigenous villages. They were like Conquistadors on the hunt for black gold," said Plater. He said such scorched-earth tactics by the companies are part of the past, a time before regulation.

For the plaintiffs, their fight has a long history and a long future. They have said they will appeal the U.S. district court's decision on "multiple grounds" and have vowed not to stop fighting until full payment is made.

I think that any company

I think that any company whether it be oil, environmental, or otherwise be held completely responsible for the damage that they do. This include loss of life, in any form. Maybe this is just an impossible dream.


    Der einzige Nachteil beim Pokern in besteht darin, dass Sie nicht über die Mimik der Mitspieler auf deren Blatt schließen können, da deren Gesichter nicht sichtbar sind.

False equivalency.

Chevron in Ecuador is not properly classed with other spills. Ecuador itself is responsible for the spill. I'd love to hate Chevron on this one, but it isn't correct.

Also highlights the better behaviour of BP

when it comes to paying out and cleaning up... so much better than Exxon... and yes, I know it doesn't make them perfect; just a little better.

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