US court rules against Chevron in Ecuador oil case

Residents say pollution was widespread, while Chevron says money was spent on a clean-up

A US court has overturned a block on Ecuadoreans collecting damages totalling $18.2bn (£11.5bn) from Chevron over Amazon oil pollution.

The order reversed a previous judge's ruling that froze enforcement of the fine outside Ecuador.

But it is not the end of the legal saga, which is also going through the courts in Ecuador.

Texaco, which merged with Chevron in 2001, was accused of dumping toxic materials in the Ecuadorean Amazon.

In February, an Ecuadorean court ruled that Chevron should pay to clean up pollution, awarding damages of more than $9bn as well as punitive damages of more than $8bn.

But Chevron, which argues that this judgement was fraudulent, successfully appealed to a New York judge to have collection of the fine blocked.

That decision was overturned on Monday, when the Second US Circuit Court of Appeals in New York lifted the injunction.

'Toxic dumps'

"We can now at least dream there will be justice and compensation for the damage, the environmental crime, committed by Chevron in Ecuador," lead lawyer for the plaintiffs, Pablo Fajardo, told the Associated Press.

However, the plaintiffs have agreed not to attempt to collect the damages until the appeals process is completed in Ecuador.

Chevron has challenged the fine, arguing that lawyers and supporters of the indigenous groups who brought the case conspired to fabricate evidence.

"Chevron remains confident that once the full facts are examined, the fraudulent judgement will be found unenforceable and those who procured it will be required to answer for their misconduct," a company statement said.

The lawsuit was brought on behalf of 30,000 Ecuadoreans, in a case which has dragged on for years.

Ecuadorean indigenous groups said Texaco dumped more than 18bn gallons (68bn litres) of toxic materials into unlined pits and rivers between 1972 and 1992.

But Chevron says Texaco spent $40m cleaning up the area during the 1990s, and signed an agreement with Ecuador in 1998 absolving it of any further responsibility.

Last month, international arbitrators ordered the Ecuadorean government to pay $96m to Chevron because Ecuador's courts had violated international law as a result of delays in resolving commercial disputes involving Texaco.