Canadian Court Gives $9.5B Chevron Lawsuit Green Light

Canada's Supreme Court on Friday dismissed a bid by Chevron to block a $9.5 billion lawsuit brought by Ecuadoran villagers who say the oil giant caused extensive environmental damage.



The 7-0 ruling allows the lawsuit to proceed in the province of Ontario, CTV News reported.



Chevron argued that the villagers had no right to sue in Ontario for environmental damages in the Amazon jungle because the company had few assets in the province and therefore there was no jurisdiction connection between the dispute in Ecuador and Ontario in Canada.



But the court said there was every right for the suit, originally sanctioned by an Ecuadoran court, to proceed, since notice of the enforcement claim was served at Chevron's office in Mississauga, Ontario, the Financial Post reported.



"Canadian courts, like many others, have adopted a generous and liberal approach to the recognition and enforcement of foreign judgments," Justice Clement Gascon wrote for the court, Canadian media reported. "Traditional, presence-based jurisdiction is satisfied."



Humberto Piaguaje, a spokesman for the villagers, heralded the court's decision as "the beginning of the end of Chevron's abusive and obstructionist litigation strategy", the Post reported.



The decision upheld an earlier Ontario Court of Appeal ruling that said villagers could pursue the suit in Canada.



But the Supreme Court did not rule on another legal point. Chevron argued subsidiaries of a company are separate and should not be responsible for the action of the corporation "parents", CTV reported.



The villagers did not pursue Chevron in the United States because a New York judge ruled that the original judgment rendered by the Ecuadoran court that allowed the suit was flawed and obtained by fraudulent and corrupt means.



That judgment was not an issue tackled by the Supreme Court of Canada in its Friday ruling.



The Ecuadoran case is decades long. It states that Texaco Inc., a company bought by Chevron in 1993, polluted 1,500 square kilometers (900 square miles) of jungle between 1972 and 1990.



The villagers must now convince an Ontario judge that the Ecuador court ruling was sound. - Kanada