Bangladesh Wal-Mart sup­pli­ers still hav­ing safety prob­lems

The Washington Times Daily - - Business -

NEW YORK | A news re­port says safety prob­lems have been found in nearly half of 75 au­dited fac­to­ries in Bangladesh that are Wal-Mart sup­pli­ers.

Ac­cord­ing to a re­port posted on The Wall Street Jour­nal’s web­site Sun­day night, Wal-Mart Stores Inc. said most of the fac­to­ries that failed the au­dit were able to cor­rect prob­lems or are do­ing so. Ac­cord­ing to the re­port, the com­pany said it has stopped do­ing busi­ness with two fac­to­ries, and one had to be closed.

Wal-Mart and other ma­jor re­tail­ers this year agreed to a pact aimed at bet­ter safety at Bangladeshi fac­to­ries af­ter deadly build­ing col­lapses and fires.

Chevron’s fraud case against Steven Donziger reaches a cli­max this week as the New York celebrity lawyer takes the stand for the first time to de­fend him­self against charges that he en­gi­neered a record­break­ing $19 bil­lion judg­ment against the oil com­pany for con­tam­i­na­tion of the Ama­zon rain for­est.

Even as the Donziger case reaches a crit­i­cal stage in a Man­hat­tan U.S. Dis­trict Court, a sep­a­rate court in Ecuador last week de­liv­ered a big break to Chevron Corp. by slash­ing in half the out­sized verdict against the com­pany for fail­ing to safe­guard its oil op­er­a­tions against lethal spills that sick­ened thou­sands of na­tives of the rain for­est.

The Ecuadorean Supreme Court threw out $9 bil­lion in puni­tive dam­ages pre­vi­ously awarded by lower courts for harm caused by the pol­lu­tion, but it left stand­ing the orig­i­nal $9.5 bil­lion judg­ment which found Chevron li­able for the en­vi­ron­men­tal harm caused by its sub­sidiary Tex­aco, which dumped bil­lions of gal­lons of un­treated toxic waste in the for­est and streams dur­ing decades of oil op­er­a­tions there.

The big re­duc­tion in the land­mark judg­ment did not sat­isfy Chevron, how­ever; it in­sists the case was ir­re­vo­ca­bly tainted by fraud and should be dis­missed al­to­gether. It vowed to keep pur­su­ing its prece­dent-set­ting New York rack­e­teer­ing suit against Mr. Donziger, who rep­re­sented the plain­tiffs in the Ama­zon case, to prove that the en­tire judg­ment was invalid.

“The judg­ment is just as il­le­git­i­mate and un­en­force­able to­day as it was when it was is­sued al­most three years ago,” said He­witt Pate, Chevron vice pres­i­dent and gen­eral coun­sel. “The gov­ern­ment of Ecuador should be in­ves­ti­gat­ing the lawyers who are us­ing its courts to com­mit fraud, rather than is­su­ing another court opin­ion in fur­ther­ance of that fraud.”

Chevron has not paid any of the mas­sive Ecuadorean judg­ment and its goal in the New York law­suit is to pro­duce ev­i­dence that the un­der­ly­ing case was ir­re­triev­ably flawed and to win a judg­ment from the U.S. court mak­ing it hard or im­pos­si­ble for the Ama­zon plain­tiffs to re­cover any dam­ages from Chevron in Brazil, Canada or Ar­gentina, where they have moved to seize Chevron as­sets.

Chevron be­came the de­fen­dant in the mas­sive Ama­zon law­suit by virtue of its ac­qui­si­tion of Tex­aco in 2001. It never owned or op­er­ated any drilling sites in Ecuador, and Tex­aco ceased drilling there in 1990, putting the com­pany’s as­sets out of reach of the Ecuadorean court.

In five weeks of trial in New York, Chevron has called in wit­nesses who tes­ti­fied that Mr. Donziger and other lawyers in the Ama­zon case ghost­wrote the court verdict giv­ing them a huge win, while engineering the out­come of sci­en­tific stud­ies find­ing gross en­vi­ron­men­tal vi­o­la­tions at the Tex­aco wells and waste dis­posal sites.

In one high­light from pre­vi­ous tes­ti­mony, the judge who signed the Ecuadorean verdict, Ni­co­las Zam­brano, ap­peared in flam­boy­ant dress in the court­room and fiercely de­nied he was paid off to use a ghost­writer. But he proved un­able to rec­ol­lect key de­tails of the verdict un­der cross-ex­am­in­ing by Chevron lawyers, and of­ten ap­peared to con­tra­dict him­self dur­ing three days of tes­ti­mony.

Mr. Donziger, who is sched­uled to ap­pear in his de­fense Mon­day, took the un­usual step of pre-re­leas­ing his writ­ten tes­ti­mony to re­porters at the end of last week, some of which could be dis­al­lowed by Dis­trict Judge Lewis A. Ka­plan. Mr. Donziger ac­cuses the judge of be­ing bi­ased against him and stack­ing the case in fa­vor of Chevron through rul­ings that, among other things, forced him to turn over per­sonal and con­fi­den­tial doc­u­ments that Chevron is now us­ing against him.

While ad­mit­ting to some “er­rors” in han­dling the Ecuadorean case, Mr. Donziger flatly de­nies hav­ing of­fered Judge Zam­brano a $500,000 bribe or hav­ing even seen or met with the judge. He said the only ev­i­dence Chevron has of the al­leged bribe is the tes­ti­mony of another Ecuadorean judge who dis­graced him­self and un­der­mined his tes­ti­mony by him­self so­lic­it­ing a bribe from Mr. Donziger.

Many of the juicy new de­tails about the lon­grun­ning le­gal saga in Mr. Donziger’s tes­ti­mony, in­clud­ing what he al­leges is Chevron’s col­lab­o­ra­tion with the Ecuadorean mil­i­tary to in­tim­i­date the Ama­zon plain­tiffs, are sure to fur­ther spice up the New York trial and put it on the list of top con­tenders for turn­ing into a Hol­ly­wood movie.

Mr. Donziger said he kept co­pi­ous notes on his ac­tiv­i­ties in the Ama­zon re­gion — notes which now are iron­i­cally be­ing cited by Chevron as ev­i­dence in the fraud case against him — with the goal of pos­si­bly writ­ing a book about it when it was over.

“I rec­og­nized the lit­i­ga­tion in Ecuador was un­prece­dented and could some day make for an in­ter­est­ing or ed­u­ca­tional book or mem­oir,” Mr. Donziger wrote.

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