Have you got a piece of this lawsuit? by Roger Parloff @FortuneMagazine June 28, 2011, 6:14 PM EST E-mail Tweet Facebook Google Plus Linkedin Share icons The bitter environmental suit against Chevron in Ecuador opens a window on a troubling new business: speculating in court cases. Many readers will have already heard about the bitterly contested $18.2 billion environmental judgment handed down against Chevron in February by a judge in Sucumbíos province in northeastern Ecuador, an Amazon jungle region where Colombian narcoterrorists go for R&R. The judgment was entered in the rough-and-tumble oil outpost known as Lago Agrio on behalf of Ecuadorians who live in the area where Texaco, acquired by Chevron in 2001, drilled for oil from 1964 to 1990. What few readers may yet appreciate is that, for much of the past six months, this controversial case has been financed by a great many investors who don’t even realize they’ve been performing that service for the plaintiffs — maybe even you. We’ll explain how in a moment. Some unsuspecting investors will doubtless be delighted to learn of their participation. They may see the suit as a noble, groundbreaking effort by impoverished Ecuadorians to redress environmental crimes committed by a callous multinational whose drilling practices are said to have contaminated ground water and caused unusually high instances of cancer in the region. Others, though, will be chagrined to learn of their support for, and stake in, the case. They would include almost anyone who has read Manhattan federal judge Lewis Kaplan’s 131-page, 434-footnote opinion of March 7, handed down in a civil racketeering suit Chevron CVX filed in February against the lead plaintiffs’ lawyers bringing the Lago Agrio case. Judge Kaplan preliminarily enjoined those lawyers from enforcing the Lago Agrio judgment anywhere outside of Ecuador. Referring to e-mails, memos, depositions, and, most remarkably, video of the plaintiffs’ lawyers’ meetings — filmed by a documentary moviemaker at the lawyers’ own behest — Kaplan found “ample evidence” that they had fabricated evidence, intimidated judges, colluded with Ecuadorian officials to bring trumped-up criminal charges against Chevron in-house lawyers, and perpetrated an elaborate multi-year fraud. Specifically, he found that they had planned, executed, and ghostwritten “all or much of” a key evidentiary report that was passed off as the work of an independent court-appointed expert to Ecuadorian and U.S. courts, government officials, and media. Now, who are all these people we say have been investing in this malodorous case without even realizing it? Well, some are American or British high rollers who put their money into aggressive hedge funds like Reservoir Capital of New York or Eton Park of London; others, however, seem to be mainly British mums and dads who hold mutual funds managed by trusted names like Fidelity International, Invesco Perpetual, Baillie Gifford, or Scottish Widows. These six institutions together own about 80% of a publicly listed investment firm called Burford Capital, based on the British island of Guernsey. Burford, in turn, invested $4 million in the Ecuadorians’ case against Chevron last November in exchange for a 1.5% stake in any recovery, with the stated goal of increasing its outlay to $15 million, entitling it to a 5.5% share. At the time Burford invested, four U.S. courts had already issued rulings that found evidence of fraud by the plaintiffs’ lawyers. In fact, three months before Burford invested, a law firm for the plaintiffs advised the fund that the Ecuadorian judgment would be hard to enforce in the U.S. because of the “jaundiced eye” with which U.S. courts were viewing the case. Those lawyers were nevertheless optimistic that if the plaintiffs threatened to disrupt Chevron’s operations by peppering it with enforcement actions around the globe — trying to, say, seize Chevron’s tankers in the Philippines or Singapore and its wells and pipelines in Chad or Kazakhstan — they could still pressure it into settling. Though the identity of investments is usually kept confidential by Burford and companies like it, Burford’s involvement in the Lago Agrio case has been dribbling into public view since December, thanks to a series of wildly improbable events, which we’ll get to later. For anyone curious about the young, controversial, and highly opaque field of litigation finance, this fortuitous development provides a rare opportunity to see how it works in practice. So let’s have a look under the hood, shall we? According to Burford’s funding agreement, the deal goes like this: If Burford ponies up the full $15 million and the plaintiffs end up recovering $1 billion, Burford will get $55 million. If the plaintiffs recover $2 billion, Burford gets $111 million, and so on. But here’s the best part for investors: If the plaintiffs recover less than $1 billion — all the way down to a mathematical floor of about $69.5 million — Burford still gets the same payout it would have received if there had been a $1 billion recovery. In other words, if there were a $69.5 million recovery, Burford would still get $55 million, though that sum would, under the circumstances, constitute almost 80% of the pot. In that event, by the way, the remaining 20% would not go to the plaintiffs; rather, it would go to other investors, who are also supposed to get their returns on investment (not just their capital outlays) before the plaintiffs start seeing a dime. In fact, under the “distribution waterfall” set up by the 75-page contract, it is only after eight tiers of funders, attorneys, and “advisers” (including the plaintiffs’ e-discovery contractor) have fed at the trough that “the balance (if any) shall be paid to the claimants.” Did the plaintiffs sign off on this “distribution waterfall”? Well, the contract says they did, though the mechanics of their approvals are not described. The plaintiffs in the Lago Agrio case, remember, are 47 Ecuadorian peasants or rain-forest Indians, many of whom authorized their lawyers to sue by signing with a fingerprint. Wait a minute, I hear many readers protesting. Is any of this even legal? That’s a very fair question. Let’s take a big step back. This industry has sneaked up on most of us. Litigation funding goes legit For most of our country’s history — and going back to medieval times in England — investing in litigation was a crime. It and related practices were outlawed under common-law doctrines known as “champerty” and “maintenance.” Basically, financing someone else’s lawsuit was considered immoral because “intermeddling” in the disputes of others fomented discord for pecuniary gain. Though these practices may still carry a stigma with older lawyers, about half the 50 states have either repealed the laws or shredded them with exceptions. Meanwhile, England and Australia have embraced litigation financing even more enthusiastically than America has. The majority view in the U.S. today seems to be that bans on third-party funding are Puritanical archaisms. To be sure, special categories of third-party funding, like contingent-fee lawyers financing clients’ tort cases or insurance companies financing the defense of policyholders, have long been accepted in the U.S. And if it’s okay for contingent-fee lawyers to finance a case, the new industry’s champions argue, why give that small fraternity a monopoly on the market? Offering plaintiffs more sources of third-party funding — or alternative litigation financing (ALF), as it’s called — will, it is said, increase access to justice by enabling more poor and middle-class plaintiffs to pursue valid claims against deep-pocketed corporate defendants. In a scholarly law review article, Georgetown law school professor Jonathan Molot argues that ALF will also increase the “accuracy” of settlement valuations by equalizing the parties’ bargaining power. Molot is currently on leave from Georgetown so that he can spend more time wearing his other hat: Burford’s chief investment officer. Only the U.S. Chamber of Commerce seems to be trying to break up this party, and, frankly, few people seem to be taking the Chamber seriously. That group sees “access to justice” as a euphemism for the power to bring meritless suits against businesses, imposing nonrecoverable litigation defense costs and thereby forcing nuisance settlements. Yada, yada, yada. Most people dismiss the Chamber’s objections as self-serving. So there has arisen in recent years an array of litigation-finance businesses that serve a variety of niche markets. At least six companies, according to a 2010 Rand Institute for Civil Justice study, now specialize in making investments in “commercial disputes,” which Rand analyst Steven Garber defines as “business-against-business” cases. In addition to Burford, they are Juridica Capital (another Guernsey-based publicly traded hedge fund), Calunius Capital, Juris Capital, ARCA Capital, and IMF (an Australian-based publicly traded fund). Some diversified financial institutions, like Credit Suisse CS , Allianz , and Deutsche Bank DB , also have units that specialize in litigation financing. Litigation financers ordinarily keep the identities of the cases they’re involved in strictly confidential. Nondisclosure agreements bar revealing any aspect of the negotiations process (including their existence), while confidentiality clauses protect any agreement reached. And there are some good reasons for confidentiality. If the defendant finds out that the plaintiff has a finite amount of money left, for instance, he may try to deplete the plaintiff ’s funds through stalling tactics. In February, after a disgruntled client filed a federal suit against Juridica and appended a copy of the funding contract to his complaint, Juridica succeeded in having not only the contract sealed, but the whole complaint. In April it also won dismissal of the suit in favor of confidential arbitration, as had apparently been envisioned in the confidential funding agreement. The court also rejected the plaintiff’s contention that there was anything unconscionable about requiring the arbitration to take place in Guernsey — off the coast of France — notwithstanding that the plaintiff, his lawyers, the relevant Juridica principals, and the funded litigation were all in the U.S. Burford’s agreement with the Lago Agrio plaintiffs was subject to confidentiality restrictions at least as severe, which were supposed to last for seven years after the contract’s termination. But thanks to lead U.S. plaintiffs’ lawyer Steven Donziger, it’s now come to light. When Donziger invited that moviemaker into his strategy and bull sessions in 2006, he inadvertently waived the attorney-client privilege to everything that took place there and more. After viewing hair-raising outtakes from the documentary (subpoenaed by Chevron) along with other evidence, three U.S. judges found that privileges protecting other documents had also been waived under an exception that applies when lawyers might be involved in a fraud or crime. Finally, Judge Kaplan ruled that Donziger had waived privileges to still other information through gamesmanship in responding to Chevron’s subpoenas. For students of litigation finance, Donziger’s Keystone Kounsel act has been a godsend. It has lifted the veil on practices that are usually pondered only as sterile abstractions. Burford is, moreover, “the largest and most experienced international dispute funder in the world,” as its promotional materials state, so we’re not looking here at some aberrational outlier in the field. Since launching in 2009, Burford has raised $300 million in two public offerings on the London Stock Exchange’s AIM market for emerging companies. Burford’s investment advisory group boasts an all-star management team: Its CEO, Chris Bogart, is a former general counsel of Time Warner TWX (Fortune’s publisher’s parent); its nonexecutive chairman, Selvyn Seidel, founded the New York office of Latham & Watkins, a top-drawer U.S. law firm; and its “special ethics counsel” is Geoffrey Hazard Jr., a Sterling professor of law emeritus at Yale Law School and “perhaps the primary figure in legal ethics in the country today,” according to Burford’s website. For those reasons, we can be assured that Burford’s conduct probably represents the very best practices the young industry has to offer. More questions than answers As soon as the veil of secrecy lifts, though, John Q. Public is apt to have some questions about Burford’s investment. To begin with, the judgment that Burford is hoping to get a piece of here was entered in the Provincial Court of Sucumbíos — a court whose integrity is hardly unimpeachable. Investing in lawsuits being heard by dubious tribunals can take on overtones of extortion. In March, Judge Kaplan found that the Ecuadorian court system, at least when handling politicized cases, had been deeply compromised in recent years, devolving into little more than a tool of Ecuadorian President Rafael Correa, a strong champion of the plaintiffs’ cause. Kaplan noted that in December 2004 the country’s three highest courts were all purged through extra-constitutional means; that its Supreme Court was disbanded again in April 2005; that in 2007, after Correa became President, a majority of representatives in the Ecuadorian Congress were dismissed and then replaced; that the country’s highest constitutional court, when it sought to reverse that action, was also purged and replaced; that a new Correa-controlled constitutional assembly was then elected; and that the assembly then passed a mandate under which judges who rule against the assembly’s dictates face removal and criminal prosecution. A new constitution was adopted in 2008, and, since then, judges who have ruled against the government’s interests have been threatened with violence, fined, removed, and criminally investigated, according to experts and press accounts cited by Kaplan. The then-president of the Ecuadorian Supreme Court stated in 2008, “There is no rule of law in this country,” and in 2009 the World Bank’s Worldwide Governance Indicators for “Rule of Law” rated Ecuador lower than North Korea. Yet if not for Donziger’s cinematic aspirations, Burford investors would still have no idea that their money had been invested in a case pending in such a court system. “In the short term,” Burford told them in an October 2009 disclosure statement, “the Company intends to focus its activities on commercial disputes in the United States and on international arbitration matters; in the medium term, the Company may expand its focus to other attractive and suitable jurisdictions.” In March, I asked Burford if it had expanded its focus more rapidly than expected, since the Lago Agrio case wasn’t a U.S. case or an international arbitration. A Burford spokesman replied, “We don’t agree with your interpretation here. The Lago Agrio case was commenced in U.S. federal court against a U.S. corporate defendant, and there is obviously meaningful U.S. litigation and international arbitration under way here.” Burford is correct that in 1993 — 18 years ago — a version of this suit was filed as a prospective class action in federal court in Manhattan. But the U.S. courts dismissed that case in 2002, with instructions that it could be refiled in Ecuador. A new complaint was then lodged in Lago Agrio in 2003, and that’s the case Burford invested in last November. Yes, there have been ancillary proceedings in the U.S., and Chevron brought an arbitration against Ecuador in the Hague, but those have largely been efforts by Chevron to expose, halt, or punish what it regards as fraud by the plaintiffs’ lawyers, and the plaintiffs’ main response to these actions has been to try, unsuccessfully, to squelch them. Another set of questions provoked when we lift the veil of secrecy on the contract relates to two meaty recurring issues in litigation finance. They are, first, whether the funder should get actively involved in legal strategy and, second, whether lawyers and funders, because they are repeat players in the litigation arena, might form loyalties to one another that could conceivably entice them to serve their own best interests rather than those of the clients. (For instance, a working group of the ABA ethics committee is now studying — among a wide range of knotty issues raised by litigation finance — whether it is okay for funders to pay finder’s fees to lawyers who steer cases their way.) How much control a hedge fund should have over a case it is financing is no simple question. If a lender is going to invest millions in a suit, he has to have some say over how his money will be used, doesn’t he? Yet if he does have control, conflict-of-interest issues come roaring into the picture. The funder’s duty is to his investors. The lawyer’s duty is to the client. To the extent the lawyer cedes control to the funder, the sacrosanct attorney-client relationship gets diluted. To help me sort out these issues, I asked Burford to what degree it gets involved in legal strategy. “We don’t control litigation strategy or litigation decisions in any cases that we finance,” the Burford spokesman replied without further elaboration. That position echoed the one Burford took in February in a letter to the ABA working group. “Burford does not hire or fire the lawyers, direct strategy, or make settlement decisions,” it said. “Burford is a purely passive provider of nonrecourse financing to a corporate party. A car lease is not a bad comparison: The leasing firm simply provides finance — it does not tell the driver how to drive the car.” Yet the very terms of the Lago Agrio contract — penalizing the plaintiffs if they settle for less than $1 billion by forcing them to still pay Burford as if they had received $1 billion — will affect settlement decisions. In addition, Burford’s marketing pitches suggest that it does get involved in legal strategy. “We do not just write checks,” its website says. “Our goal is … to improve the odds of a favorable outcome.” In a PowerPoint presentation made to the Lago Agrio plaintiffs’ lawyers in June 2010 — five months before Burford and the plaintiffs signed the funding agreement — Burford stressed that it had been working with the plaintiffs’ team since October 2009; that it had already made for the team “countless introductions to respected professionals in the U.S. and internationally”; that it had “been active in case strategy”; and that it had “a special relationship with Patton Boggs and [had] introduced the firm, and Jim Tyrrell, to the case.” James Tyrrell Jr., a prominent New York litigator with the law firm Patton Boggs, became a lawyer for the Lago Agrio plaintiffs in 2010. Tyrrell is a former colleague of Burford chairman Seidel from the days when both were top partners at Latham & Watkins. During the period when Burford negotiated its Lago Agrio investment, Burford subleased its office space from Patton Boggs’s New York office, which Tyrrell heads. Moreover, Burford is a client of Tyrrell’s. Despite Tyrrell’s web of ties to Burford — or maybe because of them — Burford’s funding contract with the Lago Agrio plaintiffs specifies that Tyrrell will be the Lago Agrio plaintiffs’ lawyer designated to administer the Burford funds and contract, and that he can be replaced only with the “Funder’s approval (which shall not be unreasonably withheld).” (So, notwithstanding what Burford told the ABA, it does seem to have a hand in the hiring and firing of lawyers, doesn’t it?) The contract then specifies that it will be Tyrrell and his firm, acting as attorneys for the Lago Agrio plaintiffs, who will decide the delicate, risky question of whether attorney-client privileged materials must be disclosed to Burford — a question where Burford’s and the plaintiffs’ best interests could easily clash. Do Tyrrell’s multiple hats here create any conflict for him? Tyrrell declined to comment, while Burford said, “That is entirely a matter for longstanding and well-developed conflicts rules … There is nothing unique about [alternative litigation funding] in this regard.” The contract also gives Tyrrell considerable voice over the plaintiffs’ lawyers’ pocketbook, which he hadn’t had prior to Burford’s arrival. No Burford funds can be disbursed for any plaintiffs team expense unless they are approved by Tyrrell. Which makes perfect sense, in a way. If outsiders are going to be funding litigation, most are going to insist on having some assurances about how their money will be spent. But such provisions mean that the financers will get some control; they are not likely to be the “purely passive provider of nonrecourse financing,” analogous to a car-leasing firm, that Burford has assured the bar committee that it is. Though legal experts have been working to resolve some of the fine ethical conundrums posed by litigation finance, there are public policy questions that a broader swath of society really ought to be weighing in on too. A world in which individuals and hedge funds are investing secretly in litigation is a different one than we’re accustomed to, and one that yields frequent nasty surprises. Last December, when Donziger was first asked in a deposition to identify the hedge fund that was investing in the case, Donziger’s attorney objected that the question was irrelevant. Max Gitter, the special master appointed to preside over the deposition, ruled that Donziger should answer, if for no other reason than that the parties could be assured that all the U.S. judges around the country who were hearing aspects of the case had no relationship with the investor that might disqualify them from acting in those roles. When Donziger identified Burford, Gitter announced that, “as if to prove the wisdom of my ruling,” he now needed to make a disclosure himself. Burford’s chief investment adviser, Jon Molot, “was a co-counsel of mine, may still be”; another member of Burford’s board was a friend and longtime former colleague; and Molot had once invited Gitter to consider joining Burford’s board. Though Gitter did not think it necessary to recuse himself, he said, “I think it does prove that it is imperative for lawyers to insist that clients disclose who the investors are.” I asked Burford about Gitter’s comment. “You raise a common misconception about litigation funding,” the firm spokesman replied. “There is no suggestion in litigation that it … should be disclosed if a party is paying for its litigation expenses with a credit line from Citibank. Burford is simply another provider of corporate finance.” Hmm. It’s not just lawyers who need to come to grips with the new world we are living in. Consider the documentary filmmaker Joseph Berlinger, whose movie about the Lago Agrio case, Crude, caused so many unanticipated problems for Donziger. Berlinger’s producer for the movie was Internet poker entrepreneur Russ DeLeon. Not long after funding Berlinger’s movie, DeLeon sank more than $2.3 million into the Lago Agrio litigation itself in exchange for about a 1.75% stake in the recovery. In an interview Berlinger says that the first he knew about DeLeon’s for-profit investment in the case was when he read about it this January in a Forbes.com article by Daniel Fisher (who was also the first to report Burford’s investment). Though Berlinger stresses that he always had complete creative control over the movie, he acknowledges some “perceptional damage.” Maybe the Puritans were right The confidentiality — secrecy — that currently envelops investments in litigation is what’s so intolerable. Yes, there are some good reasons for confidentiality, but they’re just not good enough. Confidentiality prevents oversight from bar authorities, judges, and the public. It also seems to be a critical component of the business plan of companies like Burford. Would a publicly traded company have invested in the Lago Agrio case — after four U.S. courts had raised red flags of possible fraud — if it had to do so transparently? (Burford may have decided not to fork over the remaining $11 million of its $15 million commitment to the Lago Agrio plaintiffs, inasmuch as their lawyer, Tyrrell, has been telling courts since late April that his clients can no longer pay him. Burford declines to comment.) While the Lago Agrio case is an extreme example, every litigation is contentious. Many investors would get squeamish if they knew exactly which cases made up their portfolios. They’d begin worrying about messy questions like, Am I supporting the right side? Dress it up as you like, there’s something about all this secret meddling in other people’s bitterest disputes and profiting from them that doesn’t sit well. You begin to sense why those benighted Puritans of yore banned these practices. *************************************************************************** This article appeared in the June 13 issue of Fortune magazine. A shorter version of it originally appeared on Fortune.com on May 31, 2011. After it was published, a spokesperson for the Ecuadorians suing Chevron responded. Here is her letter to the editor, and Roger Parloff’s response: To the editor: Roger Parloff’s June 13th article about the $18 billion judgment against Chevron for massive oil contamination in the Ecuadorian rainforest failed to disclose Chevron’s long history of misconduct in the eco-disaster lawsuit and the overwhelming evidence presented to an Ecuador court against the company. It is this evidence that has attracted investors to the case, but it is the misconduct that forced the impoverished Ecuadorian indigenous tribes suing Chevron to seek investors in the first place. Desperate to distract attention away from the evidence, Chevron has undertaken a full frontal attack on the Ecuadorians in U.S. courts, filing over 30 lawsuits against the plaintiffs and their experts in over a dozen different court jurisdictions to try and stop enforcement of the $18 billion judgment. Unlike Chevron, the Ecuadorians do not have unlimited resources to finance a defense. They must raise the money. Parloff is outraged by the temerity of the Ecuadorians tribes and their supporters to seek financing against the third largest corporation in the United States, but is unmoved by the difficulty poor people face in defending themselves against powerful and profitable companies, such as Chevron. While Parloff spent several days in Ecuador’s rainforest viewing the contamination, he wrote not one word describing it. He viewed several of the 900 plus gigantic oil pits that Chevron built to store permanently the toxic oil and chemical-laced water left over from its drilling activity from 1964 to 1990. Today those unlined pits continue to contaminate the soil and water. Parloff saw the production stations that Chevron built and designed with huge pipes that intentionally pumped 16 to 18 billion gallons of untreated water tainted with carcinogens directly into streams and waterways that the residents then and now use for cooking, bathing and washing clothes. We took Parloff to one pit that Chevron claimed it cleaned before filling the pit with dirt. Even though Parloff witnessed the uncovering of oil after we shoveled soil from the pit, he failed to include this evidence against Chevron in his article. Parloff harps on the “ethics” of litigation financing, but writes nothing about Chevron’s repeated public defiance of any court in any country that tries to make them pay the judgment, promising to “never pay” and a “lifetime of litigation.” While professing to be concerned about full disclosure to investors on the risks associated with litigation, he writes nothing about Chevron’s misconduct that shareholders and Fortune readers are likely not aware of: evidence that the oil giant doctored sampling results to undercount contamination in the Ecuador trial; engaged in a sham remediation; paid a retired Ecuadorian military official to help delay the trial; lobbied the U.S. government to cancel Ecuador’s trade preferences in retaliation for the lawsuit; offered money to a U.S. journalist to spy on the plaintiffs; used a convicted American drug trafficker and a self-proclaimed “dirty tricks” operative to mount a sting operation against an Ecuadorian judge. Parloff also neglected to disclose that the Third Circuit Court of Appeals hearing an appeal of one of the 30 lawsuits filed against the Ecuadorians stated emphatically that the appeals court had seen no evidence of fraud related to the Ecuador trial only Chevron’s allegations of fraud — none of which has been proven in anyone’s court anywhere. The Third Circuit also cautioned the Roger Parloffs of the world who are quick to criticize other countries’ judiciary systems. They, the court wrote, should “understand that other countries may organize their judicial systems as they see fit.” The fact is Chevron is the only party in this lawsuit that has been found guilty. You wouldn’t know it, though, from reading Parloff’s article. –Karen Hinton, spokesperson for Ecuadorians suing Chevron Roger Parloff replies: I did visit Ecuador in March. Because the story ended up having a different focus—alternate litigation finance—I did not specifically refer in it to what either the plaintiffs’ representatives (Hinton herself was never present) or Chevron’s showed me while I was there. Had I mentioned Hinton’s claim that “overwhelming evidence” supports their case, I would have mentioned Chevron’s contention that the Ecuadorian court ruling which found it so shows signs of having been written with the clandestine assistance of the plaintiffs lawyers themselves. (See New fraud allegations in the Chevron Lago Agrio case) I would have also mentioned that, even putting aside the fraud that U.S. Judge Lewis Kaplan tentatively found the plaintiffs lawyers to have orchestrated, Chevron contends that 76 percent of the plaintiffs soil and water samples were analyzed by a lab that was not then certified or equipped to perform the tests it was purporting to perform, and that plaintiffs repeatedly prevented Chevron from inspecting that lab (including once on film) notwithstanding Chevron’s having obtained court orders permitting it to do so. Had I mentioned the waste pits Hinton refers to, I would have explained that they were mostly created by a joint venture between Texaco and the state petroleum company of Ecuador, now known as Petroecuador. Though Texaco was the operating partner until 1990, Ecuador was the majority partner through most of the venture’s revenue-producing life. Ecuador was also, of course, the on-site governmental authority throughout all of the venture’s life. Had I mentioned Hinton’s claim that Texaco created “900” such pits, I would have mentioned Chevron’s contention that her figure is greatly inflated and is based in part on aerial photographs that, Chevron alleges, the plaintiffs mislabeled to make appear as if they had been shot when Texaco still operated the concession, when in fact they were shot up to 15 years after Petroecuador assumed control of operations. I would also have mentioned that in 1995 Ecuador and Texaco reached an agreement to divvy up responsibility for remediating the former joint venture’s pits. Texaco’s remediations were performed by an outside U.S. contractor chosen from a list approved by Ecuador. The process did not occur in the dead of night, but rather during daylight hours over a three-year period, with Ecuadorian officials signing off on each site upon its completion. Chevron has produced photos that purport to document that the remediations were performed as contemplated and competently. The last Texaco pit remediation was completed in 1998, at which point Ecuadorian officials formally released Texaco from all further environmental liability to it. While it may be true, as Hinton says, that some pits “continue to contaminate the soil and water,” that is, Chevron maintains, because Ecuador has still never remediated many of the pits for which it took responsibility under the 1995 agreement. The demonstration that Hinton alludes to in her letter—in which a plaintiffs’ representative, drilling into the ground with an auger, found remnants of weathered crude about 8-10 feet beneath the surface of a remediated pit site—did not, on its face, prove any violation of the 1995 agreement, which did not require removal of every trace of hydrocarbons from any site but, rather, removal of most of them and stabilization of the remainder, so they could not pollute groundwater. If I had mentioned the 15.8 billion gallons of produced water that the joint venture released into rivers and streams during the period of Texaco’s involvement, I would also have mentioned Chevron’s contention, based on statistics kept by Petroecuador, that another 16.5 billion gallons of produced water were released into those same rivers and streams by Petroecuador after Texaco left—a practice that Petroecuador allegedly did not fully discontinue until about 2006, sixteen years after Texaco’s departure. Similarly, if I had addressed any of the alleged wrongdoing of which Hinton accuses Chevron, I would have tried to do so responsibly. For instance, I would have explained that what Hinton characterizes as “evidence that the oil giant doctored sampling results to undercount contamination in the Ecuador trial” consists, in reality, of unsworn claims by an individual who has, subsequently, at least twice recanted those claims under oath. I would have also mentioned that a lawyer whom Hinton’s team retained to assess this individual’s allegations described them as “bombast from a trash-talker,” and characterized the individual himself as “incredible,” “a grifter,” and “an all-around bad guy.” Hinton’s other relevant accusations suffer from comparable weaknesses, and some are actually disproven by a close reading of the very documents she purports to rely upon.