Chevron Corp. v. Donziger

325 F. Supp. 3d 371
CourtDistrict Court, S.D. Illinois
DecidedJune 27, 2018
Docket11 Civ. 0691 (LAK)
StatusPublished
Cited by18 cases

This text of 325 F. Supp. 3d 371 (Chevron Corp. v. Donziger) is published on Counsel Stack Legal Research, covering District Court, S.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chevron Corp. v. Donziger, 325 F. Supp. 3d 371 (S.D. Ill. 2018).

Opinion

Lewis A. Kaplan, United States District Judge

This matter is before the Court in relation to Steven Donziger's motions for (1) a declaratory judgment and other relief [DI 2018], (2) a protective order [DI 2026], and (3) an "emergency administrative stay" [DI 2028]. On June 25, 2018, the Court decided the motions.1 This opinion sets forth the reasons for those rulings.

The crux of Donziger's applications in the three motions at issue here is a contention that Chevron Corporation ("Chevron")-which was attempting to enforce both a money judgment against Donziger and an injunction that restrains him from, among other things, "undertaking any acts *376to monetize or profit from the [Ecuadorian] Judgment" that this Court already has held was obtained by fraud, "including without limitation by selling, assigning, pledging, transferring or encumbering any interest therein"-was precluded by the First Amendment from discovering (a) the sources of his recent and present income and assets as well as (b) other information going to the question whether he has complied with the injunction and other provisions of this Court's judgment.

The Court assumes familiarity with its decision on the merits in this case and the Court of Appeals opinion affirmed that decision.2

The Facts

The Background

Steven Donziger has engaged in a pattern of racketeering activity that has included extortion, mail fraud, wire fraud, violations of the Travel Act and other predicate acts.

As this Court found after a lengthy trial, he and his cohorts have engaged for many years in a corrupt scheme, an object of which is to extort billions of dollars from Chevron. A lynch pin of that scheme was the fraudulent procurement of a multibillion dollar Ecuadorian judgment coupled with threats and attempts to enforce it in the United States and other countries around the world. Were that scheme to succeed, Donziger would be made a very wealthy man.

The evidence at trial of Donziger's corruption and extortionate purpose was devastating. The record showed that Donziger and his Ecuadorian lawyers, as well as others with whom he worked, produced and obtained the fraudulent judgment and thoroughly corrupted that case. Among other things:

"They submitted fraudulent evidence. They coerced one judge, first to use a court-appointed, supposedly impartial, "global expert" to make an overall damages assessment and, then, to appoint to that important role a man whom Donziger hand-picked and paid to "totally play ball" with the LAPs. They then paid a Colorado consulting firm secretly to write all or most of the global expert's report, falsely presented the report as the work of the court-appointed and supposedly impartial expert, and told half-truths or worse to U.S. courts in attempts to prevent exposure of that and other wrongdoing. Ultimately, the LAP team wrote the Lago Agrio court's Judgment themselves and promised $500,000 to the Ecuadorian judge to rule in their favor and sign their judgment."3

At the end of the trial, the Court found liability and granted equitable relief. It enjoined Donziger and the other defendants who appeared here from, among other things, seeking to enforce the Ecuadorian judgment in the United States, from profiting from it in any way, and "from undertaking any acts to monetize or profit from the [Ecuadorian] Judgment ..., including without limitation by selling, assigning, pledging, transferring or encumbering any interest therein."4 The proof at trial was sufficiently compelling that Donziger did not challenge any of this Court's factual findings on appeal.5 The Court of *377Appeals affirmed the judgment in full,6 and the Supreme Court denied certiorari.

There have been several developments since the affirmance of the judgment that set the stage for the present applications.

The Supplemental Judgment Awarding Costs

First, the Court entered a supplemental judgment against Donziger awarding to Chevron, the prevailing party, taxable costs in the aggregate amount of $811,602.71.7

Chevron's Contempt Motion and Application for Leave to Conduct Post-Judgment Discovery

Second, on March 19, 2018, Chevron sought an order to show cause bringing on a motion, inter alia, to hold Donziger in civil contempt for violating the terms of the judgment and for leave to conduct post-judgment discovery relevant its enforcement.8 It contended that Donziger was in violation both of (1) paragraph 3, which obliged him to execute a stock power transferring to Chevron all of his right, title and interest in shares of Amazonia, a Gibraltar entity formed to receive and distribute any funds collected with respect to the Ecuadorian judgment,9 and (2) paragraph 5, which enjoined him "from undertaking any acts to monetize or profit from the [Ecuadorian] Judgment ..., including without limitation by selling, assigning, pledging, transferring or encumbering any interest therein."10

Insofar as the motion alleges contempt of paragraph 5 of this Court's judgment, it contends principally that Donziger violated that provision by seeking to obtain funds from Elliott Management Corporation ("Elliott") in exchange for an interest in the Ecuadorian judgment or any proceeds of it. It supported that contention with a declaration of an Elliott official. But, Chevron suspects other possible violations and sought discovery to determine whether he had done so with respect to other funders or potential funders.

The Court signed the order to show cause. It observed in doing so that leave of Court was not required to conduct post-judgment discovery with respect to enforcement of the monetary portion of the judgment,11 i.e., the $811,602.71 costs award.

In an opinion dated May 16, 2018, the Court denied the contempt motion insofar as it relied on paragraph 3 of the judgment and ordered an evidentiary hearing, originally scheduled for May 22, 2018, with respect to the alleged violation of paragraph 5 involving Elliott.12 In addition, it ruled that Chevron was entitled to conduct post-judgment discovery with respect to its claim that Donziger had violated paragraph 5 of the judgment, relying on the Second Circuit's ruling to that effect in *378State of New York v. Shore Realty Corp. ,13 but temporarily delayed that discovery.14

The Post-Judgment Discovery

Third, Chevron propounded post-judgment discovery both to Donziger and to various non-party witnesses. As the foregoing suggests, some of that discovery is directed at locating property in which Donziger has an interest, property to which he is or may become entitled, or property that he may have transferred fraudulently, all so that Chevron by appropriate means may obtain that property or its proceeds in satisfaction of the money judgment.

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Bluebook (online)
325 F. Supp. 3d 371, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chevron-corp-v-donziger-ilsd-2018.