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Texaco on Trial | The Nation

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Texaco on Trial

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What's unique--and potentially precedent-setting--about the Texaco case, says Bonifaz, is that it is the first lawsuit to claim that a company's environmental practices so depart from acceptable international standards that they constitute a violation of the "law of nations." Until now, the ATCA has been confined to cases of torture, genocide and other more conventional human rights abuses. But in the Filártiga ruling, Bonifaz notes, the court emphasized that international law is not static but should be interpreted "as it has evolved and exists among the nations of the world today."

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In a motion to dismiss the suit, Texaco firmly denies that the law of nations applies to this case, arguing that, unlike torture and genocide, environmental misdeeds are defined differently from country to country. "Environmental debates rage today among developed and underdeveloped nations," Texaco contends. "What some nations prohibit, others encourage, and environmental priorities vary wildly."

Yet while nations do have a right to set their own environmental standards, a growing body of international accords--from the 1972 Stockholm Declaration, signed by more than 100 countries, including Ecuador and the United States, to the 1992 Rio Declaration--identifies the right to a clean and healthy environment as a fundamental and inalienable human right, and prohibits both state and private actors from recklessly endangering "the environmental needs of present and future generations," as Rio states. It's true that enforcement of these conventions has been rare--but not unprecedented. "After the Persian Gulf war," notes J. Martin Wagner of the Earth Justice Legal Defense Fund, which has filed a brief in support of the plaintiffs' claims, "the UN Security Council relied on customary international law to impose liability on Iraq for spilling into the Persian Gulf less than one-quarter of the amount of oil that Texaco is estimated to have spilled in the Oriente, and for having, like Texaco, polluted the air by burning oil."

In April 1994, in what appeared to be a historic ruling, Federal District Judge Vincent Broderick cited the Rio Declaration and other conventions in ruling that he would accept jurisdiction over the Texaco case. One year later, however, Judge Broderick died of cancer, and the case was passed along to Jed Rakoff. A former partner at a New York firm that has represented Texaco in patent litigation (though he did not personally handle those cases), Judge Rakoff, it seems safe to say, is unlikely to be as receptive to the environmental claims in the lawsuit. In a 1991 New York Law Journal essay titled "Moral Qualms About Environmental Prosecutions," he railed at US courts for prosecuting corporate officers for environmental violations carried out by their subordinates--violations that, according to Rakoff, they are often not aware of. "To imprison a morally blameless person in the name of social policy always appears in hindsight as an act of barbarity," Rakoff charged.

There can, however, be little doubt that Texaco was aware that its production methods in the Amazon departed from accepted standards. In a phone interview Texaco spokeswoman Faye Cox insisted that the company's methods, including its dumping of produced water, "adhered to prevailing industry standards.... How you manage produced water is done case by case." Yet in testimony before Congress in 1971--one year before Texaco began drilling in the Oriente--the oil industry's own leading spokesman, Richard Byrd, general counsel for the Interstate Oil Compact Commission, informed Congress that dumping tainted water "into unlined pits is not considered to be an acceptable practice." What's more, according to Bonifaz, "Texaco actually owned several patents on technology that made the reinjection of produced water cheaper. How can the company that owned these patents claim it did not know what it was doing?"

Texaco has justified its actions by noting that its operations were conducted "in compliance with Ecuadorean law" and indeed with the full approval of the Ecuadorean government. Yet Texaco's contract specifically required it to "adopt suitable measures to protect the flora, fauna, and other natural resources, and to prevent contamination of water, air, and soil," an obligation reaffirmed in Ecuador's civil code. And while there is no doubt that the Ecuadorean government, as Texaco's partner, shares responsibility for what happened in the Amazon, there is evidence that Texaco played the preponderant role. Manuel Navarro, a former high-level official at Petroecuador who later founded the country's Environmental Protection Unit, has stated in an affidavit that Texaco "designed, built, and managed all the installations and facilities required to extract and transport the crude oil" and also "trained national technicians and transferred its technology to the Ecuadorean state oil company."

"The fact that Texaco was in partnership with the government of Ecuador by no means releases the company from responsibility," says Arthur Berney, an expert on international law at Boston College. Indeed, in the recent case that was filed against Unocal, which is now proceeding to trial, a US court rejected Unocal's claim that as a mere partner of the Burmese government, the company could not be held accountable for violating international law.

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