The Rising Influence of Rising Affluence

[DewDiligence]

CVX continues to make headway fighting Ecuador environmental suit:

http://www.nytimes.com/2014/05/08/business/energy-environment/patton-boggs-settles-dispute-with-chevron-over-pollution-case.html

The powerful Washington law firm Patton Boggs dropped out of an effort to force Chevron to pay a $9.5 billion Ecuadorean pollution judgment on Wednesday, expressing regrets for its involvement in the case and agreeing to pay the oil company $15 million in settlement payments.

…Patton Boggs had served as a leading firm in a global effort to enforce the 2011 Ecuadorean judgment against Chevron in Argentina, Brazil, Canada and potentially in other countries where Chevron has assets [because CVX owns no assets in Ecuador itself].

Chevron has long asserted that Patton Boggs was involved in a vast fraud and cover-up that led to the Ecuadorean judgment… Patton Boggs’s surrender should help Chevron in its efforts to block enforcement in foreign courts.

…In the agreement, Patton Boggs agreed to assign to Chevron all rights and claims to any future payments received by the firm in the case and to remove itself as a representative in any future proceedings. The firm had a 5 percent stake in any future judgments against Chevron, potentially worth hundreds of millions of dollars. Perhaps most significantly, the firm also agreed to allow Chevron’s lawyers to take depositions from Patton Boggs’s lawyers.

The investment community never took this lawsuit seriously by modeling a sizable judgment; now, it’s likely that most analysts will discount the suit altogether if they weren’t doing so already.