The US Supreme Court on Monday rejected Ecuador's appeal against a $96 million award it has been ordered to pay Chevron in a dispute over the development of oil fields in exchange for cheap domestic crude.
The eight justices sitting on the short-handed bench allowed a lower court ruling denying the South American country's challenge to a 2011 award by an international arbitration panel based in The Hague.
At issue were seven breach-of-contract cases that Texaco — which Chevron bought in 2001 — filed against Ecuador, saying the country had "overstated its domestic oil-consumption needs, and appropriated more crude oil than it was entitled to acquire at the reduced price," a court petition read.
Chevron claimed that Ecuador had violated the 1993 US-Ecuador Bilateral Investment Treaty, which entered into force in 1997, because it was allowing the case to languish in courts for too long.
The US Court of Appeals in Washington's decision in favor of Chevron upheld a previous ruling from a federal district judge and validated the findings of the three-member arbitration tribunal in The Hague.
In a separate case, brought by the indigenous people of Ecuador's Lago Agrio region to win compensation for the mass dumping of oilfield waste between the 1970s and 1990s, an Ecuadoran court has ordered Chevron to pay $9.5 billion in damages.
The environmental destruction allegedly was perpetrated by Texaco, which Chevron bought in 2001.
But a US court found that the plaintiffs' legal team, led by American lawyer Steven Donziger, conspired to win the case by "egregious fraud," including bribing a judge, writing the court's verdict themselves and secretly paying the authors of an ostensibly independent report.
