Chevron v. Donziger: The Lawyer Who Walked Away
(Editor's Note: The American Lawyer's Michael Goldhaber is filing regular dispatches from the Manhattan federal district court bench trial in Chevron Corp. v. Donziger. For background on the case, the parties, and what it's all about, see the Litigation Daily's preview here.)
On Day Nine of the Chevron v. Donziger trial, a lawyer who had auditioned for the role ultimately taken by Patton Boggs testified that he withdrew from the case for ethical reasons after discovering what had really happened in the Ecuadorian tort suit brought against Chevron by residents of the Amazon. "I wanted no part of it," said Jeffrey Shinder, who is the New York managing partner of Constantine Cannon.
In the fall of 2009 the Ecuadorians' U.S. lawyer Steven Donziger approached Constantine's Shinder—who has worked at the antitrust boutique since earning an LL.M. from NYU School of Law 20 years ago—to help enforce the jackpot judgment that he expected to soon issue in Ecuador. Shinder testified on Thursday that Donziger "brandished" the expected judgment as "an asset," and that the "primary underpinning" for his expectation was the so-called Cabrera Report, which called for $27 billion in damages against Chevron.
To be an enforcement counsel, Shinder said he needed to be satisfied that "the process had integrity." Donziger told him that Richard Cabrera was a neutral court appointee who had independently reviewed the evidence, and that Chevron was "trumping up" the charge that Donziger's scientists at Colorado's Stratus Consulting had ghostwritten the Cabrera Report under Donziger’s supervision. Indeed, Donziger told him that there was no relationship between Stratus and Cabrera and to the extent that the Cabrera Report overlapped with Stratus' memos, that was because they were duly submitted to Cabrera, and Cabrera relied on them independently.
On the Sunday morning after Chevron fleshed out its ghostwriting allegations in a January 2010 discovery filing, Shinder said that Donziger appeared "borderline panicked." Over breakfast at Gracie's Cafe on the Upper East Side of Manhattan, he continued to deny the ghostwriting, but began to fall back on the mantra: "You have to understand they do things differently in Ecuador."
Shinder had his doubts. But in March 2010 he signed up to defend Donziger in two discovery proceedings because, he said, he wanted to learn enough to judge whether he'd feel comfortable in an enforcement role. As Shinder put it several times, he wanted to "get under the hood."
A week later Shinder flew to Colorado to speak with the scientists. At the end of a full day of interviews, plaintiffs' chief scientist Douglas Beltman admitted to Shinder that he had, on his client's instructions, substantially ghostwritten the first iteration of the Cabrera Report, recommending $16 billion in damages. Beltman recalled watching the report being printed and boxed up in the plaintiffs' Ecuador law office a day before filing. Then, in a sort of shadow play, Beltman confessed that he had criticized his own report and substantially ghostwritten Cabrera's revision, calling for $27 billion in damages.
Shinder tried to "keep [a] poker face," but inside, he found the story "profoundly troubl[ing]" and "shocking." In his deposition he said he was "sickened."
He flew out of Colorado that evening. By 10 a.m. the next morning, he had contacted his firm's ethics counsel and a managing partner, and notified Donziger that he was withdrawing from the case. Later that day, Shinder told Donziger that the Ecuadorian case was "irretrievably wounded."
"It bothered me and it still bothers me that we'll never know whether there was [an environmental] case to be made against Chevron," Shinder said. "I communicated that to [Donziger]."
Then, with Donziger's permission, Shinder spoke with John McDermott of 216-lawyer Brownstein Hyatt Farber Schreck, who was serving as local Denver counsel. According to McDermott's notes, Shinder told him to "be careful" and "be leery about information you're getting." Shinder suggested to McDermott that a lawyer remaining in the case might find himself in a position similar to a criminal defense lawyer defending a guilty client on technicalities. Shinder felt "physically ill," according to McDermott's notes, and alluded to a "fraud on [the] foreign court." (When pressed at deposition, Shinder said: "I mean, what was done was dishonest. I will leave it to others to make the legal conclusion as to whether it was fraudulent.")
Brownstein's McDermott withdrew from the case within a week. A second local counsel in Denver, Rick Kornfeld of six-lawyer Recht Kornfeld, withdrew about a month later.
The international law firm Patton Boggs quietly entered the case in February 2010 as the Ecuadorians' global enforcement counsel. New York's Emery Celli Brinckerhoff & Abady began in 2009 to assist the Ecuadorians in defending Chevron's discovery actions, with occasional support from Patton Boggs and from the national plaintiffs firm Motley Rice, which joined as settlement counsel in spring 2010. None of those firms immediately withdrew when details of the Cabrera Report's authorship emerged in 2010 (although Emery Celli withdrew in March 2011 and Motley Rice several months later). Patton Boggs's James Tyrrell filed an appearance for the Ecuadorians in the Second Circuit only a month ago.
As a matter of legal ethics, The American Lawyer asked each of those firms whether it should have withdrawn from the case immediately upon discovering their client's role in authoring the Cabrera Report, as did Constantine Cannon.
Tyrrell replied in an interview: "When Patton Boggs became involved in the case and learned more about the involvement of Stratus in preparing what became the Cabrera report, we basically took the tack, 'Well, that may not seem appropriate in the prism of U.S. law, but this is Ecuador. What's the law in Ecuador?' We went to a former justice of the Ecuadorian supreme court and others. The answer we got back was that there was, at that time, no prohibition against any ex parte communication and there was no delimitation as to what a party could not do. That was the issue Chevron began to raise at the outset with the court. We concluded that this is the practice in Ecuador. I don't know if Mr. Shinder engaged experts to help with Ecuadorian law, as we did."
In fact, Shinder testified that his decision to withdraw had nothing to do with Ecuadorian law. "I was asked to oppose an application in the U.S. to a U.S. court," he said. "It was not consequential in any way to our decision to withdraw what the specifics of Ecuadorian law and procedure were."
Perhaps more fundamentally, Chevron and its legal experts argue that the Cabrera farce did violate Ecuadorian law. They say it was unlawful for a party to secretly discuss the merits with a court officer, let alone to secretly dictate his conclusions. Citing evidence that emerged later, they argue that the Ecuadorian plaintiffs broke the law when they pressured the court to appoint a partial expert; and then bribed the expert. In short, they say, Donziger aimed to rig the case. And no matter the rules on ex parte contacts, a party can't corrupt the integrity of the court process. To Shinder, who didn't bother with a comparative legal analysis, that much seemed blindingly obvious.
Motley Rice spokesperson Alicia Ward stated that "Motley Rice acted professionally and ethically throughout its representation of the [Ecuadorian plaintiffs]." Although Motley Rice entered the case shortly after Constantine withdrew, she added, "We were unaware until late in our engagement of the involvement of the Constantine Cannon firm."
Patton Boggs and Motley Rice also gave detailed rebuttals to Chevron's allegations that they participated in a cover-up of the alleged Cabrera fraud. Motley Rice calls the accusation "unequivocally false, offensive and libelous." Tyrrell said that the courts in Colorado and New Jersey, where Chevron accuses Patton Boggs of participating in a cover-up, have both concluded that Patton Boggs acted appropriately. He also argued that lumping together the actions of all the discovery lawyers is misleading.
Emery Celli founding partner Richard Emery stated: "My firm and its attorneys acted properly in all respects in this matter. Neither the firm nor any of its attorneys knowingly submitted false or misleading information to any court in connection with its representation of its Ecuador clients."
Donziger spokesman Chris Gowen stated: "We are very confident that when the evidence is submitted and all the witnesses have testified, it will be very clear that the only side whose conduct violated multiple ethical violations is that of Chevron."
Donziger himself was not present for the first time during the New York trial. He wrote the court that he would be attending the appellate oral argument in Canada, where the Ecuadorians are still attempting to enforce the $19 billion judgment against Chevron.
Of related interest:
Chevron v. Donziger: A Dickensian Cheat Sheet
Chevron v. Donziger: Day One
Chevron v. Donziger: The Money Man
Chevron v. Donziger: Looking for Miracles in Ecuador
Chevron v. Donziger: The Scientists
Chevron v. Donziger: The Miracle Maker
Chevron v. Donziger: Judge Guerra's Tale