In one of the largest, most complex litigations in the world, we worked as part of a Chevron joint-defense team in representing our client, the chief in-house counsel for TexPet, a subsidiary of Chevron Corporation. Rodrigo Pérez Pallares came under criminal investigation in Ecuador because of a $100 billion environmental claim against the company.
We commenced a series of U.S. discovery proceedings under 28 U.S.C. § 1782 to collect evidence for Mr. Pérez’s criminal defense in Ecuador. Most importantly, we sought and obtained the outtakes of a film about the Ecuador litigation—Crude, directed by documentarian Joseph Berlinger, best known for Paradise Lost: The Child Murders at Robin Hood Hills. We persuaded Judge Lewis Kaplan of the Southern District of New York to order the production of more than 400 hours of outtakes, by far the largest volume of video outtakes ever ordered produced in the history of the United States. Click here to see the district court decision.
On appeal, we argued to a Second Circuit panel that included Judge Pierre N. Leval, author of the seminal case on videotaped outtakes, Gonzales v. Nat’l Broad. Co., 194 F.3d 29 (2d Cir. 1998). We prevailed on appeal by persuading the Second Circuit to affirm the trial court’s order, leading to the production of the outtakes. Click here to see the appellate decision.
Once we obtained the outtakes in the Berlinger proceeding, we sought discovery from lead plaintiffs’ lawyer, Steven Donziger. In this hard-fought 1782 action, we obtained hundreds of thousands of documents from plaintiffs’ lead counsel, an exceptional result, and used those documents to participate in the deposition of Donziger, which lasted a total of 16 days. Based on the discovery we obtained in the 1782 proceedings—which was pivotal in establishing Mr. Pérez’s defense—we prepared briefs and evidentiary submissions in Spanish for the Ecuadorian court.
The Ecuadorian criminal court ultimately held a preliminary hearing on whether the criminal case would proceed to trial. There, the U.S. discovery materials we had gathered were presented. Within the week, the trial court dismissed the criminal charges. The dismissal was subsequently affirmed on appeal.
Chevron then hired us to represent it in a project to obtain witness statements in Ecuador in support of its RICO action against the plaintiffs’ representatives. We obtained key witness statements for the litigation. As a result of that work, Chevron obtained testimony from former Ecuadorian Judge Alberto Guerra, who has testified that he ghost-wrote the judgment in improper collaboration with the sitting judge on the case and counsel for the plaintiffs. Click here to see the judgement on the RICO action.
STIPES V. CHARTIS, UNITED STATES DISTRICT COURT, DISTRICT OF PUERTO RICO
We represented the six principal former directors and officers (the “D&Os”) of Westernbank—once the second largest bank in Puerto Rico—in the third largest lawsuit (by loss amount) brought by the FDIC as result of the 2008 banking crisis. The FDIC sued our clients for $176 million, alleging self-dealing, fraudulent transfers and gross negligence.
To mount a defense, we were forced to litigate against the insurer when it denied D&O insurance coverage, citing an “Insured v. Insured” policy exclusion. We obtained the first favorable “Insured v. Insured” coverage ruling in this banking crisis, defended it on appeal to the First Circuit, and later obtained a favorable summary judgment ruling on a second policy based on their interrelatedness. In total, we won $100 million in coverage for our clients. Click below to hear Andres Rivero’s oral argument in the First Circuit:
Having obtained adequate coverage, we defended the lawsuit aggressively, reaching a settlement recently made public, in which our clients paid a tiny fraction of the claimed amount. Click here to see a representative pleading in FDIC v. Stipes.
HILDENBRAND V. W HOLDING CO., INC., UNITED STATES DISTRICT COURT, DISTRICT OF PUERTO RICO
We defended ten directors and officers of W Holding, Inc., in a shareholder derivative action seeking more than $130 million for alleged breach of fiduciary duty, waste of corporate assets, and unjust enrichment. The plaintiff alleged that Westernbank’s SEC filings did not conform with GAAP because loan impairments for loans originated by the bank were not properly classified in accordance with Statement of Financial Accounting Standards No. 114. The District Court granted our motion to dismiss against all ten directors and officers. Click here to see a representative pleading.
American Somax Ventures, et al. v. Mobil Land and Development Corp., et al.
When Rivero Mestre began its representation of ExxonMobil affiliates River Bridge Corporation and River Bridge Realty Corporation, the plaintiff had already obtained a final judgment of $1,248,817, and, what’s worse, a $3,553,376.09 prevailing-party attorneys’ fee judgment. As is often the case, we were brought in to clean up the mess—and did just that—by appealing the fee award. Because of our game-changing theories, Florida’s Fourth District Court of Appeal reversed the fee award and remanded for a new evidentiary hearing to reconsider the amount of the fee award. After the reversal, the case was favorably settled.
CEDEÑO V. INTECH GROUP, INC., UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF NEW YORK
We defended Juan Felipe Lara and Alhambra Investments Limited (“AIL”) against a lawsuit brought by Eligio Cedeño. Cedeño, represented by former United States Solicitor General Paul Clement, among others, alleged that Venezuelan government officials, businesses, and business people, including Mr. Lara and AIL, violated the RICO statute in connection with the Venezuelan government’s approval of a currency-exchange application and Cedeño’s sale of two Venezuelan banks.
On our motion, U.S. District Judge Jed Rakoff of the Southern District of New York dismissed the case, finding that RICO does not apply where the alleged enterprise and the impact of the alleged predicate activity are entirely foreign. Click here to see the district court decision.
Because Judge Rakoff’s ruling potentially limits the extraterritorial reach of criminal and civil RICO actions brought by the government, the U.S. Department of Justice intervened against our position on appeal. Nonetheless, the Second Circuit agreed with us, ruled in favor of Mr. Lara, AIL, and other defendants, and affirmed the district court’s dismissal of the lawsuit with prejudice. Click here to see the Second Circuit decision.
We conducted an internal investigation for the United Nations’ Office for Project Services of allegations of procurement and recruitment fraud in a nation in the Western Hemisphere in that country’s local language (not English, but we leave out the details because of the highly sensitive and confidential nature of the representation).
CONTROLADORA AMAZING TOYS, S.A. DE C.V. (“CAT”) V. MILLS CORP., UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF FLORIDA
Our client, CAT, was the owner and builder of a very successful theme park in Mexico City known as La Ciudad de los Niños, which featured an innovative edu-tainment theme for school-aged children. When Mills Corporation imitated the theme park, lock, stock, and barrel (relying on an expired North American license held by one of the original creators of the park), we brought suit against Mills for infringing CAT’s copyrights and trademarks. We obtained a favorable early settlement of the lawsuit.
We were hired by the Board of Directors of byebyenow.com to investigate potential self dealing of certain directors and officers in connection with their sale of the company’s securities. The sales of securities were allegedly in plain derogation of the directors’ and officers’ duties of loyalty and fair dealing to the company. We were subsequently hired by the court-appointed trustee for the company’s liquidating trust to sue the directors and officers for breach of fiduciary duty, breach of duty of loyalty, and breach of contract. We prosecuted the lawsuit to a favorable settlement.
MICROSOFT V. CEDEL, UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF FLORIDA
We represented Microsoft in a bench trial on the issue of domestication of a Venezuelan judgment against it. Based on expert testimony on Venezuelan law we were able to establish that the judgment in question was not final. The Court ruled for us and refused to domesticate the judgment in the United States.
RICA FOODS, INC. V. STONEFIELD JOSEPHSON, INC., UNITED STATES DISTRICT COURT, CENTRAL DISTRICT OF CALIFORNIA
We were initially hired to serve as counsel to Rica’s special-investigation subcommittee to conduct an internal investigation. Ultimately, our special investigation report formed the basis for Rica’s successful settlement with the SEC and for litigation against Rica’s outside auditors. We represented Rica—once traded on the NYSE—in an action against Stonefield Josephson, Inc., its former outside auditor, for a negligent re-audit of financial statements that RICA had filed with the SEC and the NYSE. Our lawsuit alleged that Stonefield’s negligence had, in part, caused the SEC and the NYSE to investigate and accuse Rica of securities violations. We prosecuted the lawsuit to a favorable settlement.