On the morning of April 25th, Steven Donziger drove to a halfway house in Manhattan to finalize his release papers. Upon his arrival, corrections employees used heavy-duty scissors to cut off the bulky plastic tracking anklet from his blue-jean clad leg. For almost three years, this electronic monitoring device sent Donziger’s location to the United States Department of Justice, a condition of his house arrest.
Donziger, a lawyer and proud New Yorker, spent nearly 30 years working on behalf of indigenous communities in Ecuador in a suit against Chevron for the role the company played in polluting a large region in the Ecuadorian Amazon.
The United Nations and other human rights watchdogs say that Donziger’s prosecution—the one that led to his house arrest—was orchestrated by Chevron. The oil giant’s undue influence over various individuals, law firms, and proceedings culminated in the longest sentence ever given to a US lawyer for misdemeanor contempt of court.
Chevron’s motivation? Retaliation for Donziger’s hand in the company’s loss of a $9.5 Billion class action suit over intentional pollution in Ecuador.
Chevron and Yale, at first glance, exist in separate realms. But Donzinger’s story reveals their brotherhood of hypocrisy and malpractice, a compelling indictment of fossil fuel production and investment.
Undue Influence
In the United States federal judiciary, conflicts of interest are often displayed most clearly in the realm of climate litigation. What Montana Supreme Court Justice James C. Nelson called the “legal thuggery” of corporate law firms and fossil fuel companies like Chevron has crept into precedent as corporate standard operating procedure.
This corruption spills over into educational institutions, too. The fight for fossil fuel divestment at Yale grinds on, entering its second decade. Despite an ever-worsening scientific outlook on climate change and progressive rhetoric from Yale’s leadership, there have been few material concessions and little acknowledgment from the administration with regard to divestment. Yale has fallen far behind peer institutions in the arms race of ethical investing, a race Yale invented 50 years ago with the adoption of The Ethical Investor, a pamphlet outlining Yale’s responsibility to avoid investment in companies causing “grave social injury.”
In the case of fossil fuel divestment, Yale’s conflicts of interest and impropriety start with former Chief Investment Officer David Swenson’s seat on the board of Baupost, the secretive investment firm that carried distressed Puerto Rican debt on behalf of Yale despite student backlash.
Yale’s refusal to divest from fossil fuels, like Donziger’s prosecution, is the product of layers of conflicts of interest and is fundamentally tied to corporate practices that threaten environmental lawyers, communities, and the planet.
The separation of private interests from collective outcomes lies at the core of institutional integrity. When Chevron’s financial and political interests are structurally permitted to influence the outcome of a federal prosecution, or even to bring that prosecution about, individuals like Donziger become representative of a larger threat to the structural integrity of the US judicial system.
The stories of Chevron and Yale meet under the umbrella of impropriety, safe from the deluge of accountability. The hypocrisy and malpractice stand as compelling indictments of fossil fuel investment and the fossil fuel industry, and it starts with an environmental disaster in the Ecuadorian Amazon.
A Simple Pollution Case
In 1993, then-recent Harvard Law School graduate Steven Donziger began what he thought would be “a simple pollution case,” he said in an interview with The Politic. The suit, filed in the US Federal Court in New York by a group of lawyers from the United States and Ecuador, alleged that for more than two decades, Texaco (now Chevron) left behind open pits of toxic waste and crude oil in the Lago Agrio region of Ecuador to avoid paying for proper disposal. Donziger and a team of lawyers sued under the Alien Tort Statute, which allows US courts to hear cases brought by non-US citizens if a US company has allegedly violated international law.
The suit claimed that the company had cut cleanup costs by intentionally dumping 19 billion gallons of oil waste into a section of the Amazon rainforest. The ensuing contamination affected tens of thousands of indigenous Ecuadorians in the Lago Agrio region, causing a marked increase in cancer rates, earning it the designation of “Amazon’s Chernobyl.”
Chevron Playing Defense
When Chevron bought Texaco in 2001, it inherited Texaco’s liability for the Lago Agrio pollution and the associated lawsuit. The corporation requested that the suit be moved to the Ecuadorian court system and a federal judge agreed under the condition that Chevron complies with the verdict. Chevron hoped they would reach a more favorable outcome from the then oil industry-friendly Ecuadorian court system.
However, the 2006 election of pro-environment president Rafael Correa brought a new attitude to Ecuador’s courts. Correa’s attitude and the public rhetoric against foreign fossil fuel companies reinforced years of work by teams of Ecuadorian and American lawyers, including Donziger.
In 2011, an Ecuadorian judge ruled that Chevron would have to pay $18.2 billion for their “extensive polluting” of the Lago Agrio region and damages to agriculture, health, and the environment. The Ecuadorian Supreme Court upheld the ruling a year later but reduced the settlement to $9.5 billion. Still, Chevron refused to pay the fine as instructed, instead withdrawing its resources and operations from the country and claiming the plaintiffs and their lawyers used fraud and bribery to win the settlement.
Chevron Playing Offense
Soon after Ecuadorian courts ruled in favor of the indigenous Ecuadorians in the initial suit, Chevron filed a Racketeer Influenced and Corrupt Organization Act (RICO) lawsuit against Donziger in the United States. The suit claimed that Donziger had bribed Ecuadorian Judge Nicolas Zambrano and created false documentation of the extraction-related pollution, including the 2009 documentary “Crude.” Chevron sued Donziger for $60 billion. According to Donziger, this was “the largest amount of money an American individual ever had been sued for.” Later, to avoid a jury trial, Chevron dropped the financial damages portion of the suit. The RICO case was decided solely by Judge Lewis Kaplan, a former tobacco industry lawyer with undisclosed investments in Chevron.
In the RICO case, Kaplan decided that in the course of winning his court case in Ecuador, Donziger had committed bribery and fraud. When Donziger refused to heed Kaplan’s order to turn over his cellphone and computer, claiming it would violate attorney-client privilege, Kaplan held him in contempt of court.
After the prosecutor for the Southern District of New York declined to prosecute Donziger for contempt, Judge Kaplan appointed private prosecutor Rita Glavin to prosecute Donziger on behalf of the United States. Glavin and her law firm Seward and Kissel represented Chevron as recently as 2018, a conflict of interest that Guha Krishnamurthi, a law professor at the University of Oklahoma College of Law, described as “very dangerous” to due process.
Despite this obvious connection, in 2020, a spokesperson for Chevron told The Hill that Chevron was not involved in Donziger’s criminal prosecution.
Kaplan also hand-picked Judge Loretta Preska, a leader of the Chevron-funded Federalist Society, to preside over Donziger’s criminal contempt case. The Federalist Society is a conservative interest group that has been criticized by lawmakers and watchdog groups for working to undermine judicial procedure and integrity.
Kaplan’s apparent disdain for human rights lawyers and the Ecuadorian judicial system led him to disparage both in multiple public comments and legal decisions. Preska’s led her to say at Donzigers sentencing that “only the proverbial two-by-four between the eyes will instill in [Donzinger] any respect for the law.”
False Neutrality
Chevron’s sole witness to the alleged fraud for which Donzinger was originally on trial in the case decided by Judge Kaplan was former Ecuadorian judge Alberto Guerra Bastides. Guerra claimed that Donziger’s team ghost-wrote an environmental report that was crucial to the Ecuador trial’s outcome. However, in a 2015 cross-examination, Guerra admitted to accepting bribes throughout his career as a judge. He also admitted to attempting to leverage his position as Chevron’s witness to increase his payments from the company, which have so far totaled over $1 million. Chevron also sponsored the relocation of Guerra and his family to the U.S. and delivered briefcases filled with cash to him in Quito.
Payments that look suspiciously like bribery are standard operating procedure for the oil giant. While lawyers may pay material witnesses the fair replacement value of any evidence the witness may provide, “a lawyer who pays a testifying fact witness for physical evidence, beyond the reasonable value of such evidence, violates the rule against compensating witnesses,” wrote the University of California, Irvine School of Law Dean Erwin Chemerinsky. It is unlikely, then, that Chevron was only paying the fair value of the materials and their copying and handling fees when it paid Guerra $18,000 for a laptop, among other large payments for material evidence.
In a confusing contradiction in 2015, Kaplan himself questioned Guerra’s trustworthiness: “Guerra’s credibility is not impeccable.” Yet, Kaplan’s determination that the Ecuador case was affected by fraud rested almost entirely on evidence and testimony provided by Guerra.
Ted Folkman, an expert in international commercial litigation, put it more straightforwardly: “there seems to be little if any reason to believe anything [Guerra] says.”
Chevron’s employees did not pay Guerra directly. The briefcase filled with cash and other arrangements were facilitated by attorneys with New York law firm Gibson, Dunn, and Crutcher.
“I think it is a clear example of what goes on under the radar. I think this is an extreme case, both in terms of the tactics and the publicity, of fossil fuel companies, enabled by lawyers, targeting people who dare to challenge them,” Tim Hirschel-Burns YLS ’22 said in an interview with The Politic, “But at the same time, there are a lot of law firms who are considered prestigious, where this is their MO, like Gibson Dunn.”
Hirschel-Burns is a co-founder of Law Students for Climate Accountability (LS4CA), a group of law students applying pressure on corporate firms that represent clients harming the environment or targeting activists.
Their Climate Change Scorecard, first published in 2020, grades the top 100 corporate law firms on a scale from A to F. In 2020, just 4 firms earned an A, and Gibson Dunn scored an F. Gibson Dunn, along with Exxon Mobil’s go-to firm Paul Weiss, were ranked second and first respectively in total litigations that exacerbated the climate crisis. Neither Gibson Dunn nor Paul Weiss responded to requests for comment.
“Firms have a choice about what clients they take on, but they like to act like they don’t,” said Melissa Kay YLS ’24, also a member of LS4CA. In 2021, the group launched a boycott of Gibson Dunn, which has hosted recruitment events at Yale in the past, to convince graduates and students from top law schools to consider the environmental impact of firms where they might work.
“There’s really no reputational cost or prestige cost to actors in the legal field who are playing really disruptive roles in climate change,” said Hirschel-Burns. “They should have cost to their recruitment and the talent they’re able to attract.” Imposing these costs, LS4CA hopes, will lead to action.
Hirschel-Burns and Kay said that in response to Russia’s invasion of Ukraine in February 2022, “law firms are dropping their Russian clients after years of saying ‘we are neutral, we have a duty to represent our clients.’” They hope this will send the message that “it can be done, you can drop clients.”
Law firms’ conveniently profitable ‘neutrality’ is reflected in Yale’s divestment discourse. “There is this parallel in terms of what sort of investments you’re making financially, and what sort of investments you are making with your labor and the moral and ethical choices that go along with that,” Hirschel-Burns said.
Los Afectados
The lives of those in the Lago Agrio region, where Chevron’s pollution remains, have been shaped by the for-profit destruction. “I was born here, in the Ecuadorian Amazon, about 200 meters from the second well that Texaco drilled,” Donald Moncayo told The Politic in an interview. Moncayo is the president of the Union of People Affected by Texaco/Chevron (UDAPT), the organization of plaintiffs in the original Ecuador case. He remembers the dead and lifeless rivers that have only declined since his childhood. Moncayo called for shareholders to take responsibility for Chevron’s crime, and for Chevron to respect the judgment from the court where they requested the trial take place. “It was very intentional,” he said, contrasting Chevron’s actions with the British Petroleum’s accidental Deepwater Horizon oil spill in the Gulf of Mexico in 2010. Though Donziger faced time in prison and under house arrest, Moncayo reminds us that it “is the people here in the Amazon who really suffer the impact.” For Moncayo, the impact of the pollution is personal. His relatives, friends, and neighbors suffer higher cancer rates and other health effects related to the water contamination and open waste pits scattered through their land.
Dirty Hands
“We are going to show the world the lie of Chevron… We are going to show the world the dirty hand of this oil company,” president Raffael Correa shouted proudly, his hand held high above his head, thick black crude oil dripping through his fingers. In 2013, Correa began his campaign La Mano Sucio de Chevron (The Dirty Hand of Chevron) to build public support for the Ecuadorian judgment against Chevron and to pressure the oil giant to pay.
To Donald Moncayo, the first step toward accountability is the payment of the $9.5 billion settlement that Judge Kaplan blocked unilaterally. Kaplan’s injunction prevents the Ecuadorian court system, requested by Chevron and granted on the condition of their cooperation, from enforcing the judgment through any international litigious bodies.
It would appear as if achieving accountability is almost impossible because of the judicial corruption involved in the case. The ties between several of the parties to Donziger’s contempt prosecution are ethically dubious. The connection between Chevron, Exxon’s law firm Seward and Kissel, and private prosecutor Glavin, is one of “a few procedural oddities that either violate due process or jeopardize due process,” Krishnamurthi told The Politic.
The effort to “turn our federal judiciary as far to the pro-corporate right as possible,” Donziger said, has been largely carried out by the Federalist Society, part of what he sees as the “corporate capture of public processes” that has enabled Chevron’s retaliation against him.
America’s Corporate Prisoner
Days after Donziger’s sentencing, journalist and commentator Chris Hedges put it simply: “The Donziger case is an ominous warning that the American legal system is broken.”
At the time of sentencing, Donziger had already served over 750 days of pretrial detention, a punishment condemned by the United Nations Working Group on Arbitrary Detention in a 2021 report filed with the U.S. government. The report notes that Judge Kaplan “bypass[ed] the established rules and procedures” in order to select Judge Preska to preside over the contempt case, an oddity that represents Kaplan’s “staggering display of lack of objectivity and impartiality.”
Donziger was detained for refusing to submit personal documents, phone records, computers, and communications from the Ecuador case to the court. These are items Donziger’s legal team considered protected by attorney-client privilege, as they contained private information from the Ecuador case. He was placed on house arrest and denied bail when Judge Preska deemed him a flight risk. The next day, Donziger drove himself to prison to comply with the order. He claimed this “flight risk” designation was the result of Preska’s “pure malice.”
According to professor Krishnamurthi, pretrial detention for contempt of court is both legal and “not entirely unprecedented,” in cases where a defendant or witness refuses to turn over evidence to the court, as Donziger did. What was unprecedented, however, was the “erosion” of the impartiality of the prosecutor and apparent conflicts of interest of the two involved judges. Glavin, Krishnamurthi said, was incentivized to “vindicate the interests of the judge” that she was working for in order to gain favor. The interests of the judge, in this case, were muddied by undisclosed financial ties to Chevron.
All of these conflicts represent “a serious problem in our democracy and in our judiciary,” Donziger said, in which corporate interests steamroll those of the public at the cost of human rights and civil liberties. Donziger’s case as an established legal precedent is a standing threat to environmental and human rights lawyers.
But the problem of conflicting interests goes beyond the federal judiciary. Institutional investors, including educational institutions, face similar problems that erode public trust and accountability.
Endowment Injustice
The Yale Endowment Justice Coalition (EJC) has been organizing students to pressure Yale to change its endowment investment practices for nearly a decade. Founded as Fossil Free Yale in 2012, the group has sought divestment from the fossil fuel industry and from distressed Puerto Rican debt. Today, they focus primarily on Yale’s ties to the fossil fuel industry. To EJC member Josie Steuer Ingall, conflicts of interest are part of the problem for Yale, too. Members of the Yale Board of Trustees hold “board positions, director positions, or they’re upper-level executives at these [fossil fuel] companies. It’s egregious, and none of them have ever recused themselves from any decisions pertaining to divestment” said Steuer Ingall. None of them have recused themselves, she continued, that we know of. “And we’d never know, given that meeting minutes are sealed for 50 years.”
In a complaint filed with the Connecticut Attorney General’s office on February 16, 2022, the EJC alleged that conflicts of interest were also part of the problem for institutional investors, not just for the judicial system. The complaint, compiled by the EJC and Climate Defense Project (CDP) lawyer Ted Hamilton, details numerous members of the Yale administration who have been prominent figures in Yale’s investment decisions and who have financial or political ties to fossil fuel companies – from David Swensen’s ties to private equity and Jonathan Macey’s ties to the fossil fuel industry to four other Corporation members with current or recent ties to the fossil fuel industry. According to the complaint, these ties “suggest improper influence by the fossil fuel industry” and, along with Yale’s investment in firms contributing to intentional climate misinformation, violate the Connecticut Uniform Prudent Management of Institutional Funds Act (UPMIFA), which stipulates that as a non-profit, Yale must invest its funds “with consideration for the University’s charitable purposes.” In 2021, when Harvard indicated it would divest from fossil fuels, its fiduciary duty to consider the public interest was central to the decision.
Baby Steps
Amidst dozens of lawsuits and settlements against fossil fuel corporations for deliberate climate misinformation and profit-motivated pollution, Yale quietly added Chevron and ExxonMobil, two of the world’s largest fossil fuel producers, to the list of firms not eligible for endowment investment in January 2022. The Advisory Committee on Investor Responsibility (ACIR), the body responsible for determining the ethicality of Yale’s investments based on the 1972 Ethical Investor text, makes recommendations to the Corporation Committee on Investor Responsibility (CCIR), which coordinates with Yale’s investment office and financial managers to implement the recommendations. The ACIR, which is unable to access investment information and does not provide regular public information, has been criticized as ineffective. Josie Steuer Ingall said the ACIR isn’t accountable to anyone, and that the conversation about Chevron and Exxon is one that “we can’t engage in any meaningful way with [the] ACIR because they will not answer our questions about what ‘ineligible for investment’ means.”
Previously, ExxonMobil and Chevron seemed to Yale to be “no worse than any other fossil fuel company, with respect to their position on climate change,” ACIR spokesperson Jonathan Macey LAW ’82 told the Yale Daily News in 2017. “There doesn’t seem to be any basis for singling them out for divestment.” Five years later, Yale deemed the two corporations ineligible.
Yale Walks it Back
When confronted with his “no worse than any other fossil fuel company” remark, Macey reversed his opinion in a three-sentence email to The Politic: “I was wrong before.” He admitted that Chevron and Exxon have been “particularly problematic with respect to greenhouse gas emissions.”
Exxon and Chevron were excluded from divestment under Yale’s Fossil Fuel Investment Principle (FFIP) 3, which stipulated that companies “should not undermine but support sensible government regulation and industry self-regulation addressing climate change.” The FFIP was adopted by the ACIR in April of 2021 after years of student protest. Macey, who also chairs the ACIR, did not acknowledge the companies’ human rights track records, and greenhouse gas emissions are not mentioned in Principle 3.
Steuer Ingall finds Macey’s reversal disingenuous. “Perhaps he might have referred to the state of Connecticut’s lawsuit against Exxon to educate himself. I find his claim not to have known [that Exxon and Chevron were particularly harmful] utterly unconvincing.” But, she added, “even if he is telling the truth, that ignorance is negligent. especially given that he encouraged [EJC members] in 2016 to pursue a targeted divestment case against Exxon.”
Either the chairman of the ACIR hasn’t read his committee’s own principles, or Macey is avoiding an inconvenient truth: Exxon and Chevron really are “no worse,” but he and the rest of Yale’s administration refuse to consider full divestment.
Donziger, too, disagrees with the targeted divestment approach. “Chevron is off the charts bad,” he said. They “invented the playbook of corporate criminal prosecution,” but other companies use the playbook, too. Pipeline giant Enbridge infamously funded public police forces in Minnesota to target indigenous protesters on public land. Gibson Dunn, the law firm largely responsible for Chevron’s “legal thuggery,” has also targeted the Indian Child Welfare Act on behalf of Enbridge, an apparent push to undermine tribal sovereignty and quell indigenous protest to pipeline infrastructure projects. But, Donziger continued, “the issue is not Chevron. The issue is fossil fuels. I don’t think Yale should invest in fossil fuels, period.”
Little by Little
Yale’s piecemeal divestment strategy dates back to the 1980s, when students on campus and around the world protested South African apartheid and companies doing business in the legally segregated country. Yale never divested from companies doing business in apartheid South Africa. Instead, it implemented a series of principles governing permissible action by corporations profiting under the apartheid system. These norms, known as the Sullivan Principles, were later eschewed by their creator Leon H. Sullivan, who by 1987 called for complete divestment. Yale never answered Sullivan’s, or students’, calls for divestment.
With fossil fuels, Yale is once again “trying to parse things… the idea being that some aspects of the industry are acting more responsibly than others. It just doesn’t hold water,” said Ted Hamilton, co-founder of the CDP. Steven Donziger agrees. “Chevron is willing to cross the ethical line, commit illegal acts of fraud, and manipulate courts to falsely imprison lawyers to achieve its objectives,” Donziger said.
“Every fossil fuel Corporation is, and, and fully aware of the destruction that they’re causing, and none of them are paying the true cost for the commodity that they’re exploiting,” Paul Paz y Miño told The Politic in an interview. Paz y Miño is the associate director of Amazon Watch, a watchdog group that has spent decades tracking human rights violations, including those of Chevron, related to fossil fuel production in the Amazon. Paz y Miño, too, supports divestment. For him, as for Donald Moncayo, the issue is the original pollution.
Selective Sympathy
Steven Donziger has spent most of his detention on house arrest in his Manhattan apartment. His team of lawyers has filed appeals, injunctions, and motions that are still in process. Dozens of non-profit environmental advocacy groups, 68 Nobel Laureates, and more than 200 lawyers have signed an open letter calling for his release. Amnesty International has publicly called for President Biden to pardon Donziger and end his sentence. But for communities in Ecuador impacted by the waste dumping, accountability is dead in the polluted water. “Nothing is happening,” Donald Moncayo told The Politic. For the legal team and the thousands of plaintiffs who won the case in Ecuador, there is nothing they can do against Kaplan’s global injunction against enforcement, issued before the RICO case was tried in New York.
Yale’s ACIR made Exxon and Chevron ineligible for investment in response to events between 2017 to 2021, presumably related to Chevron’s retaliation against Steven Donziger and the United Nations’ report on Donziger’s arbitrary detention. However, Yale never showed this response to decades of devastating pollution and destruction of the Amazon and its indigenous people. This selectivity is an alarming show of Yale’s moral boundaries, and of who Yale considers worth saving from the “grave social injury” that The Ethical Investor prohibits.
Yale drew the line at Chevron’s due process violations and legal conflicts of interest after they, and the US federal judiciary, received criticism from the United Nations. This moral line signals to corporations and investors that Chevron’s actions before this point were permissible, a line that only exists to protect institutional and corporate interests. Yale, too, isn’t short on conflicts of its own. Divestment from individual companies for reasons of procedural impropriety, while retaining investments in companies that wreak destruction for profit, is as hypocritical as it was stealthy.
Yale’s investment earnings, like oil companies’ corporate profits, are a product of the environmental and procedural destruction by companies like Chevron. Because, EJC member Josie Steuer Ingall said, “it is legal to render the planet uninhabitable. It is illegal for random people to do anything to try to stop it.”