Starting with General Motors, last week, it was reported that for a decade, GM (and the National Highway Traffic Safety Administration) failed to do anything about a faulty ignition switch in 1.4 million cars, like the Chevy Cobalt, which “shut off a car’s engine and electrical system, and disable[d] its air bags.”
NHTSA has now ordered the company to "answer 107 specific questions under oath by April 3, starting with why the automaker didn't fix the switches in 2004 when it first noticed a problem.… Federal rules give automakers five business days to report a safety defect to the agency or face up to a $35 million fine, as well as a possible criminal investigation." And let’s be clear: there were lethal consequences. Writes USA Today:
Beyond the initial discovery of the problem in 2004, GM in 2005 got other reports of the issue. The most dramatic evidence was a 2006 crash in Wisconsin that killed two teenage girls after the driver, who survived, veered off the road at 71 mph, flew across a driveway and slammed into trees in a 2005 Chevy Cobalt, one of the models now recalled.…
"While the time-frame suggests this issue occurred before GM's (2009 bankruptcy) restructuring, it's clear the government will hold current management responsible if it finds a lack of urgency and transparency," says Karl Brauer, senior analyst for Kelley Blue Book.
Remember that "2009 bankruptcy"? The original bankruptcy deal between GM and the Obama Administration would have completely immunized the company for any injuries or deaths caused by these 1.4 million cars. (See some of our coverage here.) The company was fully aware of this lethal safety problem when it cut this deal. Fortunately, as a result of outside pressure they changed their mind as to post-bankruptcy crashes, but as for any crash that occurred before the bankruptcy? Still immune.
Moving on to BP. We’ve been covering BP’s recent legal and PR antics, all aimed at trying to get out of compensating the businesses it ruined as a result of the 2010 Deepwater Horizon rig explosion in the Gulf of Mexico. Seems like once the company switched lawyers and hired the aggressive corporate firm, Gibson, Dunn & Crutcher, it began a disgraceful campaign to attack its own settlement, businesses making claims, and the attorneys representing these businesses. (See our recent post.)
But in a blistering decision by the U.S. Court of Appeals in New Orleans late Monday, the Court told BP to stop it. Writes Michael Hiltzik of the LA Times, the Court,
[R]ejected BP's motion to block payments to victims of the massive Deepwater Horizon oil spill under a settlement the oil company itself had agreed to in 2012.
If you're keeping track, that makes one U.S. District judge and two separate three-judge panels of the 5th Circuit Court of Appeals that have rejected BP's effort to rewrite its own negotiated settlement. The appeals decisions were both 2-1.
"There is nothing fundamentally unreasonable about what BP accepted but now wishes it had not," wrote the latest appeals panel, acidly. Payments to victims of the spill, which had been halted by an injunction obtained by BP, can now flow again.
But unfortunately, the good guys don’t always win. Speaking of Gibson, Dunn & Crutcher, this firm has been behind a truly frightening legal effort by Chevron (and, it boasts on its website, other detested industries) to go after plaintiff attorneys alleging Racketeer Influenced and Corrupt Organizations Act (RICO) violations. In its newest successful effort, Chevron went after human rights attorney is Steven Donziger, who represented indigenous peoples and farmers of Ecuador against Chevron.
Trudy Styler, who with her husband Sting “founded the Rainforest Fund 25 years ago,” explained better than we could what this case was really about:
You may be familiar with the tragic story of oil drilling in northern Ecuador: Chevron (formerly Texaco) deliberately dumped billions of gallons of toxic wastewater and spilled roughly 17 million gallons of oil ("cost-cutting measures") in the rivers and streams of the once-pristine forest. The consequence: a severe public health crisis amongst the indigenous people and farmers of the region. Cancer, birth defects, disease, and poverty for those unlucky enough to live above an American oil company's underground rivers of liquid gold.
A lawsuit was filed 20 years ago to hold the American oil company accountable, and in February 2011 Chevron was found guilty of environmental crimes in Ecuador, and was fined $19 billion by Ecuadorian courts. Ecuador's Supreme Court recently upheld the verdict, but cut the damages to $9.5 billion, a figure which would allow for environmental remediation, provision of health care and clean water, and cultural restoration, but removed the punitive damages ordered by the lower courts.
And we hoped that was the end of it. That Chevron would recognize its historical wrongs, pay the fine, and pledge to repair the damages that it caused. But instead, it has fought with alarming intensity to evade responsibility. Unfortunately, it seems, corporate impunity is the theme of our days.
Chevron has spent hundreds of millions of dollars on lawyers, public relations firms, private investigators in order to impugn the verdict in Ecuador, assault the entire Ecuadorian judicial system, discredit the human rights lawyers, and humiliate the indigenous people and farmers, who are guilty of nothing more than living in the forest and drinking the water poisoned by oil and the byproducts of its excavation.
Sting and I had the unfortunate opportunity to spend several days over the many weeks in October and November attending a trial in U.S. federal court in New York, where Chevron accused Steven Donziger, a human rights lawyer and friend of mine, along with the indigenous peoples and farmers of Ecuador, of having a waged a multi-decade racketeering conspiracy against the company. Filed under the RICO statute -- designed originally to prosecute organized crime syndicates -- Chevron's racketeering lawsuit is the oil giant's alarming and cynical attempt to destroy a two decades-long effort to hold the company accountable. And tragically, they have succeeded.
Instead of owning up to its grave responsibility in Ecuador, Chevron instead has spent millions of dollars creating what appeared to me a modern Kafkaesque drama in the courtroom, where suddenly the victims of Chevron's contamination in Ecuador have become the accused, and the polluter has become the victim; an absurd theatre where justice has been turned on its head.
We can only imagine what’s next.