Lexpert Magazine

20 LEXPERT MAGAZINE | JULY 2019 and their rights," Kauffman noted. e Court of Appeal heard the appeal in April 2018 and released its decision up- holding Hainey's judgment in May. e decision was unanimous, although Justice Ian Nordheimer, in a separate concurring judgment, would have refused to recognize the corporate veil when the result was "too flagrantly opposed to justice" — some- thing, however, that had not been estab- lished here. Several months later, the Argentine Ap- peals Court upheld the decision rejecting the Ecuadorean's attempt to enforce their judgment in Argentina, citing a lack of ju- risdiction and connection to Argentina. By that time the Ecuadoreans had decided not to take the Brazilian case any further. But the most telling blow came from the international arbitral tribunal, which, in a scathing September 2018 decision, ruled that the judgment against Chev- ron's predecessor, Texaco, "violated inter- national public law policy" because it had been obtained through fraud, bribery and corruption and "should not be recognised or enforced by the courts of other States." For the first time, the notion that Chev- ron was not at fault for the Ecuadoreans' plight, had been validated in an adjudi- cated proceeding. "e BIT award was even more vindicat- ing than Kaplan's judgment because it re- futed the plaintiffs' claim that Texaco had le unremediated environmental problems in Ecuador," Hunter said. So when Chevron Corporation brought a motion seeking a dismissal of the action against it (the summary judgment motion dealt only with Chevron Canada), the plaintiffs had clearly had enough — and consented to the dismissal. e formal or- der issued in July 2018. "e gathering momentum from a cho- rus of tribunals which condemned the Ec- uadorean judgment represented a complete substantive victory for Chevron," Lowen- stein said. Which didn't mean that the story wasn't a good one. SUZY KAUFFMAN GOODMANS LLP "WE FELT VERY STRONGLY THAT THERE WAS NO LEGAL BASIS FOR THE CASE, ESPECIALLY INSOFAR AS IT AFFECTED CHEV- RON CANADA, GIVEN THAT THE COMPANY HAD NO CONNECTION WHATSOEVER TO THE ECUADOR JUDGMENT, WAS AN INNOCENT PARTY, AND THAT A RULING AGAINST US ON THE CORPORATE VEIL WOULD HAVE ENORMOUS IMPLICATIONS," "In response, the Goodmans team went about demonstrat- ing that Chevron Canada was truly a corporate entity in its own right, and the Chevron Corporation team took on the task of showing that the policies were part of a decentralized manage- ment system and implemented in a way that allowed Chevron Canada to make its own decisions," Hunter says. "e idea was not to underestimate the Ecuadoreans' argument, and to put forward all the reasons why corporate separateness was not only a principle of law, but a reality on the facts of this case." Justice Glenn Hainey of the Superior Court heard summary judgment motions from both sides. In January 2017, he allowed Chevron's motion and dismissed the plaintiffs' claim against Chevron Canada. Lenczner appealed, and a hearing date was eventually set for April 2018. Before the hearing, things turned ugly for the Ecuadoreans — in spades. In June 2017, the Supreme Court of the United States refused to hear an appeal from a 2016 federal court of appeal decision upholding Kaplan's ruling. Several months later, Argentinian and Brazilian courts separately held that the Ecuadorean judg- ment could not be enforced in their countries. Undaunted, Lenczner refocused. "Before the hearing of the appeal, the plaintiffs added Peter Grant, who had an aboriginal practice, to their team and shied the angle of argument to make it more about indigenous people Julius Melnitzer is a legal affairs writer in Toronto. FEATURES ART OF THE CASE

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