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The Supreme Court of Canada has granted Chevron’s application for leave to appeal the Ontario Court of Appeal decision allowing Ecuadorian plaintiffs to sue here to try to collect their $18 billion Ecuador pollution judgment. According to a US court, that award was based on fraud.

Our Supreme Court will now decide whether the Ecuador award against Chevron can be, in principle, collected from Chevron’s indirect Canadian subsidiary, which had nothing to do with the pollution and health damage left after four decades of oil extraction in Ecuador by Texaco and others. Chevron inherited the case when it purchased Texaco in 2001. Texaco says it had honoured a $40 million cleanup and settlement agreement signed with the Ecuadorian government, but much pollution remains. The villagers say Texaco had caused this pollution; Texaco says it was the Ecuador state oil company.

Highly respected Ontario Superior Court Judge David Brown had dismissed the Ontario claim, on the ground that the assets of the Canadian subsidiaries do not belong to Chevron, and cannot be seized for its debts. The Ontario Court of Appeal overturned his decision, shortly before the U.S. District Court for the Southern District of New York  ruled that the $9.5 billion judgment against Chevron Corporation in Ecuador was obtained by fraud and racketeering.

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