## Facts

- Texaco operated oil fields in Ecuador’s Lago Agrio region beginning in the 1960s; residents later asserted environmental-injury claims.
- Earlier U.S. litigation over the alleged harms was dismissed on forum non conveniens grounds, after which litigation proceeded in Ecuador; Chevron later acquired Texaco.
- In 2003, Ecuadorian plaintiffs sued Chevron in provincial court; in February 2011 that court entered a multibillion-dollar judgment against Chevron.
- Chevron filed suit in the Southern District of New York asserting RICO, fraud, and related claims, alleging the Ecuadorian judgment was procured through fraud, collusion, and corruption directed by Steven Donziger and others.
- Chevron alleged, among other things, that key expert materials were ghostwritten by plaintiffs’ agents, evidence was falsified, and political and coercive pressure was used to influence the Ecuadorian process.
- Chevron sought a temporary restraining order and preliminary injunction to bar Donziger and the Ecuadorian plaintiffs from pursuing recognition or enforcement of the Ecuadorian judgment outside Ecuador while the U.S. case proceeded.

## Issues

1. Whether Chevron showed a likelihood of success (or sufficiently serious questions) that the Ecuadorian judgment was not recognizable/enforceable under New York’s Uniform Foreign Country Money-Judgments Recognition Act due to fraud and lack of impartial tribunals or due-process-compatible procedures.
2. Whether Chevron would suffer immediate and irreparable harm absent an injunction because of imminent, multi-jurisdiction enforcement actions and potential non-recoverable asset seizures.
3. Whether the district court could issue a worldwide anti-enforcement injunction restraining the parties from seeking recognition or enforcement of the foreign judgment outside Ecuador.

## Decision

- The court granted a preliminary injunction barring Donziger, the Ecuadorian plaintiffs, and related defendants from commencing, prosecuting, advancing, or benefiting from any proceeding outside Ecuador to recognize or enforce the Ecuadorian judgment.
- The court found Chevron demonstrated at least serious questions (and a substantial showing) on the merits that the judgment was obtained by fraud and rendered in a system lacking required impartiality/due process for recognition.
- The court found Chevron faced immediate, irreparable harm from threatened worldwide enforcement efforts, including extraordinary pressure to post bonds or pay and the risk of unrecoverable losses if assets were seized abroad.
- The court concluded the balance of hardships and public interest favored maintaining the status quo pending adjudication, and that equitable relief could run against the parties without directing foreign courts.

## Legal Principles

- Under New York’s Uniform Foreign Country Money-Judgments Recognition Act, recognition may be denied if the judgment was rendered under a system lacking impartial tribunals or procedures compatible with due process, or if the judgment was obtained by fraud.
- Preliminary injunctive relief may issue where the movant shows irreparable harm and either likelihood of success on the merits or sufficiently serious questions on the merits plus a balance of hardships tipping in the movant’s favor.
- A federal court may, in appropriate circumstances, restrain litigants from pursuing foreign proceedings when necessary to prevent irreparable harm and protect the court’s ability to afford effective relief; such orders act on parties, not foreign tribunals.
- When imminent enforcement activity threatens asset restraints or seizures across jurisdictions before a meaningful merits determination, the risk of non-recoupable loss and coercive settlement pressure can support irreparable-harm findings.

## Conclusion

The court preliminarily barred Donziger and the Ecuadorian plaintiffs from pursuing recognition or enforcement of the Ecuadorian judgment outside Ecuador, holding that Chevron made a strong showing of fraud-related and due-process-based nonrecognition defenses and faced irreparable harm from imminent global collection efforts, and that a worldwide party-directed injunction was an available interim remedy.


Chevron Corp. v. Donziger, 768 F. Supp. 2d 581 (S.D.N.Y. 2011)