RosenbergCrude

Crude

The film // Crude //, released in 2009 and directed by Joe Berlinger, details the legal struggles of indigenous peoples in the Amazon Rain Forest in Ecuador to extract pecuniary reparations for the environmental damage caused by Texaco during its oil operations in the region. In juxtaposing scenes of local devastation and hardship with the dodgy arguments of executives and lawyers of Chevron (the current owners of Texaco), the piece suggests that Texaco deliberately polluted the rain forest in the name of profit maximization, and has wavered in its responsibility to clean up these damages as a result of deceitful practices.

With the enormity of this legal battle, the principal stakeholders have become significantly varied in both scale and purpose. In one end of the arena is the oil corporation Chevron, which through its acquisition of Texaco in 2001 has taken on the matter of defending against the litigation. Due in large part to its size and influence, Chevron is hoping to score not only a financial victory, but also to avoid a precedent setting legal decision which could have cascading effects in other countries in which they have operated. To accomplish this goal, they have dragged out the legal proceedings for over 17 years with the intent of starving the resources of the plaintiffs, and will likely continue to appeal the verdict that was recently rendered in the case.

At the other end of the spectrum, indigenous peoples in Ecuador have seen their quality of life eroded substantially in the absence of controls on pollution and other such safeguards. As a result of the dumping of toxic water in riverbeds and streams, it is believed that the locals have suffered such maladies as skin rashes and cancers. Although these individuals are seeking punitive damages for the purpose of continuing to clean up the environment, they are also hoping that there will be recompense for the substantial human toll inflicted upon them, such as the destruction of societies likew the Cofán. However, they are constrained by the cost of legal representation, and are being supported on a consulting basis by the Kohn, Swift, & Graft Law Firm.

Located in-between these interests are too additional groups: the national government of Ecuador and those subjected to oil operations in other countries. While the leaders of Ecuador would like to protect its people and preserve its natural resources, they must also balance this goal with the incentive of promoting foreign direct investment and partnerships between state owned and foreign oil companies. Additionally, they are likely aware that in the event of a decision against Chevron, PetroEcuador will be subject to related charges and penalties for its 15 years of continuing these practices. Similarly, citizens of other countries in which these corporations act have been keeping a close eye on the proceedings, as a decision against Chevron could open the door for potentially damaging lawsuits in other locations.

Although the piece did not focus significantly on the factors which contribute to our dependence on oil, it did at one point screen a film created by Texaco in the 1970’s which was representative of the motivation behind the exploitation of the resource. Through its depiction of automobiles filling up at a gasoline station, it declared that humans require access to cheap, abundant energy to promote their lifestyles. In this sense, it is also implied that the profit motive not only contributes to the behavior of the corporations with regards to exploitation of environments, but also to their perpetuation of the modern energy regime. If such gains are to be at stake in the process of providing this energy, then it is likely that there will be immense efforts made to combat attempts at weaning ourselves off of the product. As the 17 years of legal expenditures in the film have demonstrated, corporations will go to any length to protect their interests when it comes to such an essential feature of economic growth. With the beginnings of alternative energy sources coming to fruition in recent years, it seems that a major contributing factor to our dependence on oil is in fact the resistance to these potentially sweeping realignments of the industry.

On the other hand, the problems caused by our dependence on oil are depicted no more clearly than through the suffering of the Amazonian people. One of the major problems of the pressures of rapid extraction and production has been the lack of regard for environmental and local health concerns in the regions in which these operations occur. During its time in Ecuador, it is stated that Texaco has released enough pollutants into the environment to blanket 1,700 square miles, which has amounted to as much as thirty times the damage caused by the Exxon Valdez spill. As a result, local animals have been poisoned and died from drinking water from streams and rivers, and it is estimated that as many as 15 or 16 out of 20 babies have some kind of skin rash. These concerns are not limited to multinational corporations, as it is stated that 17 spills have occurred at one station in the 15 years since Ecuador’s national oil company reclaimed ownership of the facility.

With so much money at stake, it is obvious that there are notable incentives in place to skirt these issues in practice. From the design of local waste repositories, it is suggested that Texaco intended all along to channel these byproducts into the water, and also that cheaper technologies and profits were traded for the longer term damages which would not have to be borne by the corporation directly. Additionally, while Texaco was responsible for cleaning up the pits it had dug for pollution upon leaving the country, it was found that some were simply covered with dirt, and had seen the construction of homes upon them. Legal officials have not been immune to these pressures either, as numerous government officials and a Chevron attorney were indicted on corruption charges during the proceedings.

As a film focusing specifically on the costs of oil production, less is discussed regarding a shift away from oil. However, it is implied by what is presented that mobilizing such a cultural and economic shift would loosen the protections faced by oil companies in abstaining from environmental responsibility. In particular, they would likely face substantial litigation in response to the precedent set in the Ecuador trial, and may be forced to pay punitive damages by their home countries. While it is not clear whether a mobilization away from oil would ultimately prevent environmental harm in a more general sense, it is suggested that some of the local populations may bounce back in the event that these features are restored through the results of the litigation.

In watching the film, I was very compelled by the graphic scenes of the suffering of the Cofán villages in the rain forest, and how powerless they were to respond to such crises. One of the women and her 18 year old daughter both had cancer, and their treatments required them to travel 18 hours and pay $500 for each course. However, since the chickens they had purchased to make a living had died from drinking the local water, they were struggling to meet these obligations. It is also mentioned that the population on the native lands of the people had decreased from 15,000 to just a few hundred people since Texaco came, and that one of the drilling platforms had polluted a sacred site of the indigenous population. Through showing the horrifying skin rashes and cancers inflicted upon the children, it was easy for the film to vilify the oil corporations and executives who had permitted such practices to take place.

In contrast, I was less convinced that there was not corruption going both ways throughout this court case. At one point, Steven Donziger clashes directly with one of the Chevron attorneys while meeting in the judge’s office, which suggests that the matter had become a personal crusade in addition to a legal one. It is also difficult to see what has gone on behind the scenes, since it is likely that these kinds of underhanded dealings would not have taken place while the individual was on camera and filming was in progress. With how easy it seemed to sway the judge to suspend and implement new directives, I am immediately skeptical of whether he was knowledgeable enough to properly ensure an objective trial, and in particular to hire a court-appointed, independent expert to assess the degree of damages. As the figure that was recommended was $27 billion, which was over five times the largest ever rewarded, one has to wonder whether the official may have had biases. In considering that the newly elected President Correa was notably sympathetic to the cause of the class action lawsuit, one is skeptical as to whether there may have been additional pressures on the expert to provide a favorable result.

In terms of corrective action, the piece offers an intriguing example in which the quality of life of the natives was restored even without cleaning up the pollution directly. In one village, modern filtration systems had been installed to collect rainwater for the local residents with the assistance of Sting and Trudie Styler’s environmental organization. Perhaps through similar efforts, the health of these communities may be preserved until larger scale cleanup efforts can begin. In addition, it is proposed that garnering the appropriate level of media and celebrity attention may help to galvanize citizens in favor of these causes. As a demonstration of such, the article which was released in Vanity Fair about the case opened up new speaking opportunities in locations such as San Francisco and the 777 Live Earth Concert, and provided new opportunities for recognition such as through the 2008 Goldman Environmental Prize.

Beyond these humanitarian concerns, it is implied that leadership, and in particular government oversight, provides a crucial vehicle through which reformation of these damaging practices may take place. In this sense, an event which was cited as having especially aided the cause was the 2007 visit by President Correa to some of the villages in the rain forest, which attracted much media attention and represented a symbolic gain for the cause. Also, it is implied that through its profitable partnership with Texaco, the Ecuadorian government did not uphold its responsibility to regulate the industry substantially. Although the lure of royalties is likely immense for national governments, they inevitably have an important say in the practices of foreign corporations, since these institutions are the owners of natural resources within their borders. If these agencies were to take greater steps to preserve the well being of their people, whether through restrictions on pollution or a Pigovian tax to internalize the costs of extraction, perhaps the consequences of globalization would be less severe in these countries.

In seeing the film, I was motivated to seek out additional information regarding the recent verdict that had been rendered in the case, which came after the completion of the documentary. The following sources were found to prove useful in this task:

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The first of these sources details a racketeering suit that against the plaintiffs of the Ecuador case in the United States. Filed in the Southern District of New York, the claim alleges that collusion has occurred which has amounted to extortion, and cites as evidence a report submitted by an expert that Chevron claims to be “biased and false.” It is believed by legal experts such as Douglas Rees that this move has been made with the intent of gaining public relations leverage in the process of negotiating potential settlements, as well as to gain traction in United States courts, where the judgment made in Ecuador will ultimately be enforced.

The second of these sources outlines the context of the recent $8.6 Billion in punitive damages awarded in the case, and offers an outlook for the progression of the enforcement in the coming years. Although the case is stated to be second in magnitude behind only that concerning the BP oil spill, it is suggested that its circumstances more greatly mirror the protracted dealings in response to the Exxon Valdez incident. From this, it is believed that the difficulty in the case will mostly arise from enforcing the ruling in other countries, since Chevron does not have assets in Ecuador at present. As examples of this, a restraining order has been issued in New York temporarily preventing enforcement of the ruling, and an international arbitration panel based in the Netherlands has similarly asked Ecuador to not immediately enforce the judgment. In viewing these difficulties, it seems likely that it will be many years before the book is closed on this case, and one has to wonder whether Chevron will ever pay the full amount of the damages.