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Chevron shareholders meeting: Amazonians, investors, lawyers

Lawyers will be driving tomorrow's media coverage of Chevron annual shareholders meeting in San Ramon, Calif., Wednesday, but we bet they spend very little time in front of the camera. Instead, we expect to see Amazonian Indians, the predictable celebrity or two, and many enraged activists as the campaign against Chevron for past environmental damage in Ecuador reaches an even higher pitch. Driving this PR explosion is the $27 billion lawsuit filed in the United States, Aguinda v. Chevron-Texaco.

It's a well-organized (or orchestrated) alliance, a combine of trial lawyers, activists and the Ecuadorian government. The combine has certainly been successful getting sympathetic, incomplete media coverage from places like "60 Minutes" -- "Amazon Crude" -- and the New York Times.

As Chevron's general counsel and executive vice president, Charles James, commented on a bloggers' conference call today:

I think that everything you are seeing now that is transpiring here is really aimed at pressuring a settlement, and not having to confront the reality of trying to enforce this case. ...I've asked people to ask themselves a very simple question: If these plaintiffs thought for just one second that they were going to get an enforceable judgment out of the courts of Ecuador for some multibillion dollar amount, why this show? Why is all of this going on? Why are they attempting to pressure the investors? Why all this media stuff?

This is, you know, Plaintiff's Lawyers 101, which is to try to settle it. In virtually every case of this type that I have been involved with since I have been at Chevron, at some point when we got discovery, we got an e-mail that said, "Don't worry, they'll never take this case to court. We're going to settle it."

But instead, Chevron has aggressively fought back against the lawyer-activist combine in the PR battles, starting with its document-rich website, www.chevron.com/ecuador/. Along with the bloggers (see disclosure below) Chevron's PR outreach has also included the use of Twitter, and video reports to counter pieces like 60 Minutes' segment. (One senses from "On the Media" and other journalists the sentiment, "How dare they use a former journalist to respond?")

The other interesting angle is the use of shareholders meeting by Trillium Asset Management, part of the "social investment industry," to push a resolution that serves the PR purposes of the trial lawyers. In a May 20 letter to Chevron shareholders, Chevron's corporate secretary, Lydia I. Beebe, reports an e-mail that describes a November 2003 meeting with "one of the American trial lawyers and others to plan a campaign to 'pressure' Chevron. The email memorializing that meeting reports that Trillium Asset Management agreed to take the lead with regard to stockholder proposals."

In his blogger call today, Chevron's Charles James explained the company's PR outreach as necessary to shed light on what he called "extra-judicial" activity designed to force a settlement: "This is how the game is going to be played in these types of cases unless, and here is the big 'unless,' unless someone ...starts to look at this behavior on behalf of the trial lawyers and asks some meaningful questions about why it's happening."

Disclosure: Chevron has invited several bloggers, me included, to travel to Ecuador at company expense in the near future to visit the sites in the Amazon that are at issue. There have been no demands, requests or hints to write anything in support of Chevron's side.

I did write two posts at the NAM's blog, Shopfloor.org, today based on the blogger call.


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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.