Canada’s Supreme Court lets Ecuador villagers sue Chevron for $9.5bn
Canada’s Supreme Court ruled on Friday that a group of Ecuadorian villagers can proceed with their US$9.5 billion pollution lawsuit against Chevron Corp. (NYSE:CVX) in the Canadian province of Ontario.
The court found simple reasons to let the suit be pursued in Canada, noting that the original lawsuit, a claim for environmental damages in the Amazon jungle, was properly brought in Ecuador. However, it also found the Ecuadoran plaintiffs had every right to bring the claim against Chevron, since it was able to serve notice of the enforcement claim at the company’s office in Ontario.
The main issue the court was supposed to decided on was whether there was a real and substantial connection between the villagers and the dispute on one hand and the province of Ontario on the other.
However, Canada’s top court said there was no need to prove such connection, as long as a foreign court assumed valid jurisdiction over a case.
“Canadian courts, like many others, have adopted a generous and liberal approach to the recognition and enforcement of foreign judgments,” Justice Clement Gascon wrote in the unanimous, seven-judge ruling.
While Chevron Corp. has no assets in the South American country, Ecuador’s Supreme Court has affirmed a $9.5 billion US judgment against the company, which allowed locals to pursue its subsidiary, Chevron Canada.
“In today’s globalized world and electronic age, to require that a judgment creditor wait until the foreign debtor is present or has assets in the province before a court can find that it has jurisdiction in recognition and enforcement proceedings would be to turn a blind eye to current economic reality,” Justice Gascon wrote.
Today’s decision could set a precedent for similar cases involving mining companies around the world.